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Infrastructure sharing boosts African telcos

By , Journalist
Africa , 26 Feb 2015

Infrastructure sharing boosts African telcos

Infrastructure sharing across Africa provides telecoms operators the opportunity to focus on their core business, says an expert.

According to Lehlohonolo Mokenela, ICT industry research analyst at Frost and Sullivan the return on investment on deployment of infrastructure in remote areas is too low

Regulators in markets such as Zimbabwe are increasingly encouraging and setting parameters for infrastructure sharing by operators.

Tower management companies are also increasingly foraying into the area, boosting the rapid spread out of infrastructure, says Mokenela.

Various infrastructure sharing deals have been signed across the region with Helios Towers, American Tower Corporation and Eaton ramping up the number of towers they are managing on behalf of operators in the Africa region.

"Firstly, it requires extensive investment on the part of the operators to deploy infrastructure in rural areas. The addressable market in rural areas may not justify the required investment (return on investment may be too low) to serve those areas," Mokonela told ITWeb Africa.

Earlier this year fixed phone telco, Telecom Egypt, and mobile operators Mobinil and Vodafone in the north African country inked a $2 billion deal to provide infrastructure and international calling services.

Under this arrangement, the two mobile operators will have their operations riding on Telecom Egypt's infrastructure.

"This lowers the infrastructure capital and operational cost, leaving operators to focus on their core business," Mokonela said.

According to Frost and Sullivan "infrastructure sharing (for the telecommunications industry in Africa) assist in spreading the cost between multiple operators," a development that is "becoming quite prevalent" in less monopolistic markets such as Tanzania.

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