Trends & Forecasts

Growth in African tower market underlines viability of leasing model

Growth in African tower market underlines viability of leasing model

The market for tower services in the Sub-Saharan Africa region was worth an estimated $991.7 million in 2016, according to Research & Markets.

It is expected to grow at a compounded annual growth rate (CAGR) of 8.8%, to reach $1,508.4 million in 2021. MNOs are becoming open to selling off or outsourcing the management of their infrastructure to third-party providers in order focus on their core operations.

With MNOs still looking to increase their network coverage, towercos will need to secure prime sites in urban areas and strategic locations in rural areas that can offer a long-term Average Revenue Per User (ARPU) from value-added services.

With their high base of towers, coupled with the low penetration of towerco-owned towers, South Africa and Kenya offer the greatest potential for future tower sales. However, the leading operators have not demonstrated a willingness to sell their towers in the short to medium-term.

There is a growing opportunity for towercos to boost tenancy ratios from leasing capacity to emerging, relatively small providers of wireless broadband services such as WiFi and Long Term Evolution (LTE).



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