Africa’s Broadband Tariffs Decline in Q4 2013

London 1st April 2014– According to Quantum-Web’s Africa Broadband Tariffs Analysis the broadband pricing in the African continent in Q4 2013 shows a slight decline compared to the previous quarter.

The average monthly price of fixed broadband tariffs stood at €42 (Figure 1)

Figure 1- Average fixed broadband tariffs in Africa, Q4 2013 (€)

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The average monthly price of wireless broadband tariffs was €25 during the same period (Figure 2).

Figure 2- Average wireless broadband tariffs in Africa, Q4 2013 (€)

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The report further reveals that in terms of cost per GB the average fixed broadband price in Q4 2013 was €3.21 per GB while that of wireless broadband was €12.25.

The gap between fixed and wireless monthly broadband prices in Africa exhibits an inverse trend compared to the rest of the world where the fixed broadband prices are cheaper than wireless broadband.  This phenomenon can be explained by the lack of fixed broadband infrastructure in Africa.

The adoption of fixed broadband is very slow but some operators such as Algerie Telecom, Ringo in Cameroon, Wananchi in Kenya, Tunesiana and Tunisie Telecom in Tunisia launched superfast fibre optic technology in the region.

LTE services are available in Algeria, Namibia and South Africa and the introduction of LTE had an impact on the reduction of wireless broadband prices in those countries.

According to the report it appears that the operators in the region set their price structure through trial and error based on the demand for bandwidth and in line with retail price regulation. This implies the lower capacity entry levels for most users to ensure affordability of broadband services for the population, allowing operators to experiment with their retail pricing.

In countries such as Cote d’Ivoire and Mali operators are providing a more affordable wireless broadband service while in countries such as Rwanda and Algeria prices are still very high for the majority of the population and there are no signs of price reduction in the short term period (Figure 3).

Figure 3- Wireless penetration and effective €/GB excluding VAT in Africa, Q4 2013

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In the fixed wireless segment there is an inverse correlation between the cost of 1GB data and fixed broadband penetration. In countries such as Benin and Cameron, with a low broadband penetration, prices are the highest in the whole region, whereas in countries such as Egypt and Tunisia, among the highest fixed broadband penetration countries in the region, the cost of 1GB data is relatively cheap (Figure 4).

Figure 4- Fixed broadband penetration and effective €/GB excluding VAT in Africa, Q4 2013

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This report includes both wireless and wireline broadband tariffs of 68 major operators in the following countries:

  • Algeria
  • Angola
  • Benin
  • Cameroon
  • Congo, Dem. Rep.
  • Côte d’Ivoire
  • Egypt
  • Ghana
  • Kenya
  • Libya
  • Mali
  • Morocco
  • Mozambique
  • Namibia
  • Niger
  • Nigeria
  • Rwanda
  • Senegal
  • South Africa
  • Sudan
  • Tunisia
  • Zambia
  • Zimbabwe

The tariffs are analysed according to the following parameters:
• Download and upload speed
• Recurring and non recurring costs
• Throttling or overage details
• Type of device
• Bundling characteristics

The report analyses broadband pricing strategies of each operator included in the research on the basis of the following perspectives:
• Fixed broadband tariffs by speed
• Fixed broadband tariffs analysis by access technology
• Fixed broadband tariffs analysis for stand-alone vs. bundled services
• Wireless broadband tariffs analysis of 3G and 4G
• Wireless broadband tariffs analysis of 3G and 4G for cost per GB