The telecommunications industry of South Africa is one of the most advanced on the continent, offering high levels of mobile penetration, growing Internet connections, and an advancing infrastructure which has all come about since 2008. The industry has gone from an introduction of free social media usage to the launch of localized streaming platforms that will eventually help the country catch up with the United States, the UK, and others who are already benefitting from high levels of broadband access.
The issue which faces the South African telecommunications industry is cost. The price to access data is excessively high for the average person here, with mobile data ranked as the most expensive out of Africa’s six leading economies. It currently ranks 94th in the world out of 197 countries in terms of total competitiveness.
Although the cost of data has not seen a drop in recent years, there are some efforts in place attempting to address the issue. That includes new regulations that protect consumers from expiring data access, improved 4G access, and reduced charges for out-of-bundle services.
Monetary figures quoted in these statistics are all for the South African Rand.
Important South African Telecommunications Industry Statistics
#1. The exchange rate for one South African to the U.S. dollar on January 21, 2019, was 0.072. This low value against the benchmark greenback is one of the reasons why there is a struggle within the South African telecommunications industry to expand coverage and access. (Google)
#2. The total net income for the South African telecommunications industry in 2013 was 276.3 billion. Only 5% of the value generated by the industry comes from post and associated courier activities, which are valued at 14.2 billion. Total goods and services represented a 4.4% increase over the figures reported in 2010. (Statistics South Africa)
#3. There are about 107,000 workers currently maintaining their employment with the telecommunications industry of South Africa. 66% of the workers are employed in the distribution of telecommunication products or services. (Statistics South Africa)
#4. Employment in the telecommunications sector in South Africa grew at 6% in 2013 when compared to 2010 employment figures. (Statistics South Africa)
#5. Casual employments recorded their highest ever increase, at 74.4%, according to 2013 data. There were 8,766 workers classified under this designation in 2013 compared to only 1,653 working in 2010. (Statistics South Africa)
#6. Although employment figures are up for the industry, the number of permanent workers decreased by 0.6% in 2013 when compared to 2010 figures. (Statistics South Africa)
#7. The number of women working in the South African telecommunications industry dropped from 41% in 2010 to 39% in 2013. (Statistics South Africa)
#8. Total income levels from Internet services provided by the industry reached 35.1 billion in 2013, which was an increase of 8.6% over the figures released during a 2010 survey of financial health. Data revenue from wireless services contributed 56% of that figure. (Statistics South Africa)
#9. SIM card penetration in South Africa approached 143% for the first time thanks to the popularity of multiple card use by consumers. The use of mobile broadband services led to this high rate of growth as well. (BuddeComm)
#10. Mobile internet accounts in South Africa are responsible for 95% of the connections which occur. About 94% of the overall population is able to access (or will in the near future) LTE services that will help the Internet sector continue to see robust levels of growth. (BuddeComm)
#11. Only 9.4% of households in South Africa had a cell and landline connection. 3.5% of homes have no telecommunication services whatsoever. (ICASA)
#12. Households in the Western Cape are the most likely to have a landline and a cellular connection, with 22% of homes reporting this setup. (ICASA)
#13. The Northern Cape household is the most likely to have zero connections with the South African telecommunications industry, with 9.7% of homes reporting this condition. (ICASA)
#14. About 60% of the households in South Africa have access to the Internet in some way, but only 9.5% say that they can get online when they are at home. Almost 60% of the connections are based on “anywhere” connections. (ICASA)
#15. The telecommunications sector contributes almost 3% to the GDP each year, with a slight increase (0.2%) occurring between 2013-2014. (ICASA)
#16. Total mobile services revenue grew by 10.4% in 2017, while revenues from other mobile services increased by 158%. Revenue from outbound roaming decreased, however, by almost 17% during the year. (ICASA)
#17. Prepaid mobile data CAGR over the past 3 years has increased by over 34%, while prepaid voice and prepaid messaging saw increases of 0.7% and 8.6% respectively. (ICASA)
#18. The annual investment in fixed-telephone services increased by more than 11% for the South African telecommunications industry in 2017, with annual investments in broadband services increasing by 61%. (ICASA)
#19. Procurement spending from all suppliers based on the B-BBEE for the 12 months ending in September 2017 reaches 95.8 billion, compared to 86.4 billion the year before. (ICASA)
#20. Blacks filled over 27% of the top management positions in the South African telecommunications industry in 2017, while 11% of the upper-level positions were filled by black women. (ICASA)
South African Telecommunications Industry Trends and Analysis
The South African telecommunications industry is seeing high levels of demand for data access as the economy begins to modernize. It has only been 25 years since the stop of apartheid, and although the local value of the currency is still quite low when compared to highly developed economies, the population is continuing to demand modernization.
As the rest of the world contemplates how to integrate 5G technology into their telecommunications services, the South African segment of the industry is wondering how to increase their 4G coverage. Most of the country is still operating on 3G or less, so there are no plans in place at this current time to upgrade to the latest technology options.
When the price of data is figured into the struggles this industry faces as well, then it is clear there is trouble brewing. People want access to data, but they cannot always afford it. Price control mechanisms and consumer protections are being developed, but they are not always fully implemented.
Until formal structures can help consumers gain the access they want at a price they need, the South African telecommunications industry will continue to experience starts and stops of growth. Unless foreign direct investment occurs or government regulations change this dynamic, what we see from the industry today will likely be what we continue to experience in the years to come.
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