Data new cash cow for African cellular players

A TELECOMS content battle is brewing across Africa as mobile networks seek new revenue opportunities on top of the mobile data explosion sweeping the continent.

Vodacom this week announced a 100% increase in revenue from data traffic in its African networks outside South Africa, while the comparatively mature South African market had 20% growth.

At the same time, voice revenue rose 27% outside South Africa, and for the first time fell — by 2.6% — in South Africa. However, total revenue growth was flat in the face of falling interconnect revenues and plummeting data costs.

Nevertheless, during the opening session of the AfricaCom conference in Cape Town this week, Romeo Khumalo, chief operating officer of international business for Vodacom, stressed that mobile data represented the biggest opportunity for operators across the continent.

He also reiterated CEO Shameel Joosub’s previous comments that Vodacom intended investing more heavily in building infrastructure.

Most speakers concurred that the answer would be provided by OTT — Over The Top services — which are essentially applications and services that depend on mobile data networks for their use. The most obvious of these, video, is still too demanding on network capacity to be viable, representing a massive missed opportunity, said Brett St Clair, Google’s head of new products for sub-Saharan Africa.

“The opportunity is guys with smart devices that want to consume video, but just can’t use the service at the moment,” he said. “Let’s get the service and the access right and open up the access speeds.”

Khumalo acknowledged that operators were prepared to accelerate investment but wanted regulatory certainty.

In particular, licensing of Long Term Evolution spectrum, which will lead to 4G high-speed data networks, was being held up by regulators.