The evolving telco sector, the gap for emerging providers

The African telecommunications landscape is undergoing a shift, with consolidation among larger players creating space for emerging operators.

This trend coincides with the booming mobile financial services market, presenting exciting prospects for smaller telcos.

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Shifting focus for established telcos

Robert van Breukelen, CEO of Itemate Solutions, observes a strategic shift among established telecom companies.

As mobile money accounts in Africa surpassed 435 million by the end of 2023, these larger players are increasingly focusing on financial services like banking, loans, and insurance.

This diversification allows them to tap into a lucrative market while neglecting underserved segments.

Emerging telcos: Filling the gap

This presents a golden opportunity for emerging telcos. With larger companies prioritizing urban, digitally-savvy customers, emerging players can target the underbanked population in rural areas.

Sub-Saharan Africa boasts a large prepaid user base with many still relying on feature phones. By catering to these segments, emerging telcos can contribute to digital inclusion and local economic growth.

Challenges and advantages

Building brand loyalty and overcoming infrastructure costs remain hurdles for emerging players.

Established brands like MTN and Safaricom/Mpesa enjoy strong customer loyalty, making it difficult for newcomers to gain a foothold. Additionally, the high cost of deploying advanced 5G networks presents a significant barrier.

However, emerging telcos have advantages too. Government support is increasingly playing a crucial role. Governments might hold stakes in telcos or offer preferential pricing and regulations to promote digital inclusion. This fosters a more level playing field and allows smaller players to grow their market share.

Understanding diverse needs

Africa, particularly smaller emerging markets, has a diverse customer base. From 5G-enabled metropolitan areas to remote rural villages, customer needs vary greatly.

Collecting and analyzing customer data is crucial for emerging telcos to personalize their services and cater to this diverse population.

Agility and customer focus

Emerging telcos are uniquely positioned to understand and cater to their diverse customer bases.

Their agility and customer-centric approach allow them to adapt to changing market demands and deliver tailored solutions.

As they embrace cutting-edge technologies, emerging telcos have the potential to not only meet but exceed customer expectations, driving growth and fostering a more connected and inclusive future for Africa.

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