Zamtel bidders eye 19% mobile market share

Competition set to intensify in Zambia's mobile sector as plan to privatise incumbent Zamtel gathers pace.

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Zamtel bidders eye 19% mobile market share Competition is set to increase in Zambia's mobile sector after the privatisation of Zamtel.
By  Roger Field Published  November 24, 2009

The privatisation of Zambia's incumbent operator Zamtel could lead to a rapid improvement at the company and put pressure on the country's existing private mobile operators, Zain and MTN, according to a report from a UK-based research organisation.

With companies including MTNL, Telecel Globe, Telkom SA and Vimpelcom all carrying out due diligence on Zamtel, a report from research organisation Onda Analytics estimates that the new owner could revitalise the company, gaining a 19% share of the mobile market by 2015, up from its current 4% share.

However, the report stresses that Zamtel's new owner will need to follow a strategy "along the lines of a new entrant" to achieve this level of growth.

 "The new investor will have to turn around an operator in crisis. A strategy along the lines of a new entrant will be needed, as Zamtel has fallen further and further behind in the mobile market," said Daniel Jones, partner, Onda Analytics.

"High mobile tariffs and low penetration in Zambia present an opportunity for the buyer. Aggressive price competition and going after subscribers new to the market will help Zamtel grow its market share and challenge its competitors."

Under the right strategy, Onda Analytics forecasts Zamtel to grow its mobile market share from 4% in 2009 to 19% by 2015, increasing its subscriber base from 160,000 to 1.8 million. The report also analyses the strategic importance of Zamtel's other assets, including its fixed line network and the WiMAX network currently in deployment.

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