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Notes on mobile broadband

March 26, 2012  »  Broadband & Business & MobileNo Comment

In most African nations, broadband is synonymous with mobile broadband. However, as mobile customers shift from voice and SMS to data, telecoms operators are more likely to face tight profits. What factors cause this trend?

  • the majority of broadband revenue often comes from corporate customers
  • high churn rate among customers who can only afford short-term contracts or short pay-as-go periods
  • the introduction of 3G usually impedes the mobile revenue growth rate in the short-term since average revenue per user is inherently lower
  • increased operator competition lowers revenue as companies lower prices to attract customers
  • fortunately for rural areas, tight urban margins can shift operators’ focus to under-served areas
  • growth rates could take off in a few years as a strong mobile base shifts to mobile broadband – social media is a driving factor as well

Regardless, the shift to mobile broadband is a slow one. Although mobile user growth rates are high and competition is increasing, the user-base is still relatively low.