Omdia View: July 2024

In the Middle East and Africa, a key highlight in the month of July was Nokia and Telecom Egypt partnering for a planned launch of Egypt's first 5G service.

Tanzania reported significant progress in 5G deployment, achieving a population coverage of 15% since the country's first commercial 5G launch in September 2022.

Meanwhile, in Senegal, the telecoms regulatory authority (ARPT) published revised interconnection rates for mobile virtual network operators (MVNOs) and value-added service (VAS) providers aimed at promoting growth in the country's MVNO and wholesale market.

Here are Omdia's top telecoms highlights for July 2024 across the Middle East and Africa.

Nokia and Telecom Egypt to introduce 5G to Egypt

— by Walaa Ibrahim, Omdia senior research analyst, Middle East and North Africa.

Nokia and Telecom Egypt announced a partnership to introduce 5G technology to Egypt for the first time.

This initiative will involve upgrading Telecom Egypt's radio access network in key cities, including Alexandria, Aswan, Cairo, Giza and Luxor.

As part of the agreement, Nokia will deploy 5G radio access network (RAN) equipment from its AirScale portfolio, which uses energy-efficient ReefShark system-on-chip technology to enhance network performance and connectivity.

Omdia sees this partnership as a significant step forward in Egypt's telecom sector. The introduction of 5G is expected to address the increasing demand for high-speed Internet and improved connectivity in densely populated areas of Egypt.

This technology will enable faster data speeds, more reliable network performance and support for a wider range of applications, from enhanced mobile broadband to advanced enterprise solutions.

Telecom Egypt, having secured the country's first 5G license earlier this year, is well positioned to lead this transformation.

The deployment of 5G infrastructure will likely bolster Egypt's digital economy, providing the necessary foundation for innovations in various sectors such as healthcare, education and smart city initiatives.

Furthermore, this advance will enable Telecom Egypt to expand its digital portfolio significantly and offer a broader range of services to both consumer and enterprise customers.

Omdia forecasts that Telecom Egypt will have 1.32 million 5G subscriptions at the end of 2025 and will have 13.41 million 5G subscriptions by 2029.

Nokia's energy-efficient technology is particularly relevant for Egypt, where there is a need to develop infrastructure that is both high-performing and sustainable.

This is crucial in a country with growing urbanization and increasing energy demands. Implementing energy-efficient solutions can help manage operational costs and reduce the environmental impact of expanding telecom networks.

Tanzania records 15% population coverage for 5G service

— by Danson Njue, Omdia senior research analyst, Middle East and Africa.

Tanzania has recorded 15% population coverage for 5G technology since the first commercial launch in September 2022.

According to the Tanzania Communications Regulatory Authority (TCRA), 5G population coverage increased from 13% in the first quarter of 2024 to 15% in the second quarter of 2024 on the back of increased investment in network infrastructure deployment by the operators.

However, the geographical coverage of 5G stood at 2% at end-June 2024. Tanzania has made significant progress in 3G and 4G network deployment with population coverage reaching 89% and 83%, respectively.

The regulator reported a 6.8% quarter-on-quarter growth in the number of Internet subscriptions to 39.3 million at end-June 2024.

Vodacom Tanzania launched the country's first commercial 5G service in September 2022, followed by Tigo in February 2023 and Airtel in August 2023.

Tanzania has recorded 15% population coverage for 5G technology since the first commercial launch in September 2022.(Source: Image by freepik)

According to Omdia market data, Tanzania had 497,800 5G subscriptions, representing 0.7% of the total mobile subscriptions by the end of the second quarter of 2024.

5G technology was Tanzania's fastest growing mobile service, with subscriptions increasing by 127% year-on-year in the second quarter of 2024.

Despite the strong growth, Omdia notes that the rate of 5G uptake will remain low with only 12.1% of the total mobile subscriptions using the service by the end of 2029, compared to 59.8% for 4G.

Lack of affordable 5G devices remains the key challenge for the increased adoption of the service in Tanzania.

Senegal revises MVNO interconnect rates

— by Thecla Mbongue, Omdia research manager for the Middle East and Africa.

In July 2024, the Senegalese telecoms regulation authority (ARPT) published revised interconnection rates for MVNOs and VAS providers. The previous tariffs were issued in 2022.

Under the new rules, interconnection rates for MVNOs to terminate calls on mobile network operator (MNO) networks dropped by 59% from XOF3.4 (US$0.0057) to XOF1.395 (US$0.0023) per minute.

SMS interconnection charges declined by 9% and mobile data charges declined by 64% per MB.

The regulator wants to stimulate growth within the MVNO and wholesale segments.

As of June 2024, the country had licensed three MVNOs. However, only one, Promobile, was active. No update is available about the launch of the remaining two licensees, You Mobile, and Origines SA, despite the fact that they have had licenses since 2017.

Promobile's subscription base has grown steadily, recording a 49% growth over the year to March 2024.

In the meantime, beverage distributor Kirene has been successfully running an MVNO-type network for over 15 years in partnership with Orange. Kirene is however not considered as an MVNO and only holds a reseller agreement with Orange.

ADNOC partners with e& to develop the largest private 5G wireless network in the energy industry

— by Walaa Ibrahim, Omdia senior research analyst, Middle East and North Africa.

Abu Dhabi National Oil Company (ADNOC) and e& have announced their strategic collaboration, planning to build the world's largest private 5G wireless network in the energy sector, which will cover 11,000 square kilometers of ADNOC's onshore and offshore operations.

This initiative is set to enhance connectivity, integrate advanced AI solutions, while improving operational efficiency, cost-effectiveness and safety.

Omdia sees this partnership as a significant advance in ADNOC's digitalization efforts.

The 5G network will facilitate high-speed data transmission, enabling real-time monitoring and control of operations through sensors in over 12,000 wells and pipelines. This connectivity will support autonomous decision-making in control rooms, optimizing asset lifespan and ensuring field safety.

The project, slated for completion in 2025, is anticipated to generate substantial economic value, with projected benefits of US$1.5 billion over its first five years.

The integration of 5G technology will allow ADNOC to further automate its processes, enhancing efficiency and reducing emissions, aligning with the company's sustainability goals.

You can find Omdia's full Middle East & Africa News Digest here.

For more information about Omdia's consulting capabilities, contact them directly at [email protected] or reach out to the Omdia analysts by emailing [email protected].