Feature Story
Commentary on
EMEA’s Emerging Markets
by Andy
Hicks,
Senior Research Analyst, Communications, IDC CEMA
In Africa, motivated seller has finally met motivated buyer: Bharti
should soon officially take control of most of Zain’s
Sub-Saharan assets. Last year, Bharti made a run at MTN, but the South
African government’s desire to maintain control over the
combined entity resulted in such a complicated ownership structure that
the deal collapsed under its own weight.
In Africa, motivated seller has finally met motivated buyer: Bharti
should soon officially take control of most of Zain’s
Sub-Saharan assets. Last year, Bharti made a run at MTN, but the South
African government’s desire to maintain control over the
combined entity resulted in such a complicated ownership structure that
the deal collapsed under its own weight.
Now MTN seems slowly to be moving its operations to Dubai, a possible
prelude to moving its headquarters out of South Africa as well. The
most obvious motivation is finally to sell off part of its operations
as
well, but since the economic crisis potential buyers are evaluating
acquisitions in emerging markets much more closely. In the Middle East,
Qtel
and Du are on record that African telecoms markets are too expensive;
will MTN’s other Indian suitor Reliance reappear?
Reliance, Bharti, and other Indian telco groups have been angling for
significant African stakes for a while, under the theory that their
expertise in India’s low-penetration, low-ARPU markets will
transfer well to Africa. At IDC we will be watching this experiment
closely, since Sub-Saharan Africa’s regulatory patchwork,
lower population density, sparser technological talent, and leadership
in some mobile services differentiate it from the Indian market. The
Indian telco model relies more on network outsourcing and
infrastructure sharing more than is common in Africa; it may take a
while to implement this model fully in Africa.
We
will also be watching closely to see if Bharti retains the One Network
roaming model that was originally introduced by Celtel. It has
always been difficult to determine if the stickiness benefits of One
Network outweighed the foregone roaming revenue; Bharti's decision on
the strategy will give us a good indication.
_____________
Several of us recently returned from the Mobile World Congress in
Barcelona. It is always interesting to get together with colleagues
from mature markets, if for no other reason than that sooner or later
you find yourself talking at cross purposes, and that in turn can
illustrate important differences between the markets. One example: from
an OSS/BSS point of view, the evolution of mobile payments in our
markets basically transformed the charging platform into a transaction
platform. Once this happened, support of the retail agent network had
to be integrated much more closely with core BSS components. This is
not a common pattern in developed markets.
_____________
Several IDC analysts were judges for the GSMA Awards announced at the
MWC. We were glad to see the number of winners from our markets:
- Best Mobile Money Service: M-Pesa, Kenya
- Best Billing or Customer Care Solution: Mobile
TeleSystems (MTS), Russia
- Best Use of Mobile for Social and Economic
Development: Grameen Foundation, MTN Uganda, and Google, Uganda
- Best Mobile Money for the Unbanked Service,
Zain Bahrain, Bahrain
- Green Network Award: mcel, Mozambique
- Best Mobile Game: Iricom, Russia
Taking into account additional winners from China and India, emerging
markets dominated the awards, underlining their status as a source of
innovation in mobile technology and services. It’s a good
time to be in the field.
There was a plethora of interesting contestants in the awards. If
you’d like to discuss a particular category (full list here: http://www.globalmobileawards.com/awards/winners.shtml),
drop us a line and we’ll let you know if we provided a judge
for that category.
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