Tanzania Telecommunications Report Q4 2012 - New Study Released

Fast Market Research recommends "Tanzania Telecommunications Report Q4 2012" from Business Monitor International, now available

by Bill Thompson

(WireNews+Co) - Boston, MA - 26 October 2012

BMI View: The Tanzanian telecoms market has strong growth potential, most notably in traditional mobile and wireless data services with mobile penetration reaching 56.1% in Q112. The VAS market is also showing great potential, with Vodacom's M-PESA service reaching 3.6mn users in Q212. However, set against this potential is the legacy of the price war that followed Airtel's entry, with the lowest ARPUs in the region. There are large numbers of inactive subscriptions, although the precise figure was not clear at the time of writing. If Vodacom's discounting of inactive subscriptions in Q212 is an indicator for the reality of the market as a whole, the contraction could be over 25% of subscriptions in Q112.

Key Data:

View Full Report Details and Table of Contents (http://www.fastmr.com/prod/464572_tanzania_telecommunications_report_q4_2012.aspx) (http://www.fastmr.com/prod/464572_tanzania_telecommunications_report_q4_2012.aspx)

- The latest TCRA data show strong mobile growth to Q112, with the market expanding 22.5% yo- y to reach 26.806mn subscriptions and penetration of 56.1%.
- However, Vodacom discounted subscriptions in Q212 (only operator with results available for Q212) when switching from the 215-day to 90-day active subscription definition, resulting in a net loss of 3.569mn subscriptions - a q-o-q contraction of 28.2%.
- M-commerce users have continued expand, with M-PESA users reaching 3.6mn in Q212.

Key Trends And Developments

Operators are increasingly looking to rural areas for expansion. In June 2012 Vodacom announced plans to expand coverage of its money transfer service M-PESA by upgrading its network, to allow residents in the most remote parts of the country to access the service. Vodacom Managing Director Rene Meza stated that mobile penetration reached 80% in urban areas, but was below 25% in rural areas, justifying expansion to tap growth opportunities. In July 2012 Zantel followed suit, announcing plans to expand its network into rural areas.

Operators are also increasingly targeting wireless data growth. In June 2012 Tanzanian alternative operator Smile Communications, owned by Smile Telecom Holdings, announced the launch of a 4G LTE network in the capital city Dar es Salaam over 800MHz spectrum. Meanwhile, in February 2012 Vodacom Tanzania announced plans to invest US$94mn (TZS120bn) in expanding wireless data services to improve coverage and network capacity over 2012 and H113. Vodacom is hoping mobile internet penetration can rise from 3-4% in 2012 to the 15% reached in its neighbour Kenya.

In late June 2012 the government announced new taxes for telecoms operators in its 2012/13 budget. Excise duty on mobile airtime is to increase to 12% from 10% while a tax exemption on telecoms towers is to be abolished. BMI believes operators in Tanzania already face a significant tax burden and additional taxes may curtail investment and industry development.

Fast Market Research (http://www.fastmr.com) is an online aggregator and distributor of market research and business information. Representing the world's top research publishers and analysts, we provide quick and easy access to the best competitive intelligence available. Our unbiased, expert staff will help you find the right research to fit your requirements and your budget. For more information about these or related research reports, please visit our website at http://www.fastmr.com or call us at 1.800.844.8156.