MTN Announces Increase in Subscriber Base

South Africa-based telcoms group MTN has announced that its consolidated subscriber base increased to 134.47 million as at 30 September 2010, up 4% from the 129.21 million reported at the end of June. A company statement credited the increase to ‘high quality networks, attractive value propositions and efficient distribution’.

The South and East African region, which contributes 22% of the group’s customers, increased its subscriber base by 4.9% to 30.08 million for the quarter - mainly driven by growth in its domestic market. In South Africa, the customer base rose 3.9% to 17.77 million, helped by the addition of 616,000 pre-paid users and its MTN Zone offer, which allows MTN subscribers access to a discounted call rate if they are in an area experiencing a low volume of MTN traffic. ARPU in South Africa remained stable at ZAR152 (USD21.6).

The West and Central African region, which contributes 46% of the group’s subscribers increased its customer base by 3.4% in the three month period to 61.38 million. Nigeria – MTN’s largest single market and that which contributes 60% of the region’s subscriber base - grew its base 5.1% to 36.84 million. MTN credits the increase to ‘superior network quality and a successful distribution framework’. Elsewhere in the region, Ghana’s customer base declined from 8.72 million to 8.46 million due to the introduction of mandatory SIM registration on 1 July 2010.

The Middle East and North African region, which accounts for the remaining 32% of MTN’s consolidated subscriber base, increased its numbers by 4.1% to 43.01 million. MTN says that the growth within the region was mainly due to its Iranian operation, which contributes 66% of the region’s subscribers. MTN Irancell increased its users by 5.6% to 28.49 million. Elsewhere in the region, Syria benefited from improved brand awareness, increasing its subscriber base to 4.72 million, a rise of 6.8%.

Zain Could Be Planning Syria Investment

­Kuwait's Zain is reported to be interested in investing in the Syrian mobile market, either through an acquisition of an operator license, or a stake in an existing operator. The country currently has two networks, locally owned Syriatel and South African owned, MTN Syria.

During 2008, the U.S. Department of the Treasury blacklisted Syriatel due to its links with Rami Makhluf, which the US government has blacklisted due to his connections with the government. Any investment by Zain in the company would have to overcome that political hurdle.

Kuwait's Al Anbaa newspaper reported that officials from Zain have met with the Syrian telecoms ministry to work out a suitable manner for the company to enter the market. However, Zain denied being interested in the market when rumours first emerged early last year.

The Syrian government has also been considering offering a 3rd mobile license for well over a year.

Figures from the Mobile World analysts note that the country ended the first half of this year with an estimated 8.6 million mobile phone users - representing a population penetration level of around 42%.

MTN Attributes Fall In SA Growth To Sim Registration

­South Africa's MTN Group has announced that it had a shade under 108.5 million subscribers at the end of September. This is a 5% increase for the quarter from 103.2 million subscribers recorded at the end of  June 2009 and a 19.6% increase for the year to date.

The South and East Africa (SEA) region increased its subscriber base by a very modest 0.5% for the quarter. This was primarily due to the disappointing negative movement of the South Africa subscriber base which contributes 64% to the region. South Africa's subscriber base declined from 17.23 million at the end of June 2009 to 16.42 million at the end of September. The main reason for the movement is the significantly lower number of gross connections following the implementation of RICA in August, which requires PrePay SIM cards to be registered with the operators. Given the current market uncertainty following the RICA implementation there are challenges with South Africa achieving its revised target of zero net additions for the full year.

Uganda increased its subscriber base by 11% in the quarter following the continued success of MTN Zone which now constitutes 95% of the total prepaid base.

The West and Central Africa (WECA) region increased its subscriber base by 5% for the quarter driven mainly by Nigeria which accounts for 58% of the region's subscribers. Nigeria recorded a 5% increase in its subscriber base to 28.76 million mainly due to continued network rollout, innovative product offerings and the effectiveness of the distribution channels implemented earlier in 2009. Ghana maintained its market share and increased its subscriber base by 2,6% despite aggressive competitor activity. Both Cameroon and Cote d'Ivoire increased their subscriber bases by 4% and 5% to 4.19 million and 4.21 million, respectively.

The Middle East and North Africa (MENA) region recorded a 9% increase in subscribers for the quarter. This was largely due to continued growth from the Iran operation, which contributes 62% to the region's subscribers and increased its base by 8% to 20.7 million. Iran's growth was attributable mainly to expanded network coverage and continued promotional activity. Syria increased its subscriber base by 13% to 4 million, well above expectations. Afghanistan, although a relatively smaller operation, has been steadily contributing positively to the region's growth and has gained No. 1 position in the market from No 3 at the beginning of 2009.

MTN has revised its subscriber net addition guidance for the year for South Africa to zero and for Syria to 550,000 while other individually disclosed country guidance remains the same. MTN expects to achieve the total group subscriber net addition guidance for 2009 of 22.6 million.

MTN Reports Growth In Subscriber Numbers

­South Africa based MTN Group has published an update of its global subscriber based and recorded 98.2 million customers at 31 March 2009. This is an 8% increase for the quarter from 90.65 million subscribers recorded at the end of last year. The company noted that while strong subscriber growth continues to be a feature in almost all countries in which it operates in, currency volatility has generally had a more negative impact on ARPU reported in US$. Changes to spending patterns have been varied as economies respond to the global economic situation.

South and East Africa (SEA) region contributed 26% (December 2008: 27%) of the Group's total subscribers while West and Central Africa (WECA) and Middle East and North Africa (MENA) contributed 45% (December 2008: 44%) and 29% (December 2008: 29%), respectively.

The SEA region increased its subscriber base by 4% for the quarter. The South African operation contributes 69% to the region's subscribers, increasing 2% to 17.43 million for the quarter ended 31 March 2009. The modest increase in subscribers was due to the mix of seasonal trends, weakening economic conditions and aggressive competition. Uganda increased its subscriber base by 13% due to the continued success of MTN Zone.

The WECA region increased its subscriber base by 10% for the quarter. The strong growth in the region was primarily due to growth in Nigeria which contributes 59% to the region's subscribers and recorded a 12% increase in its subscriber base to 25.9 million. This was mainly due to continued improvements in network quality and capacity with 173 BTS's added in the quarter. Ghana increased its subscriber base by 5% despite fierce competition. Both Cameroon and Cote d'Ivoire increased their subscriber bases by 7% to 3.82 million and 3.81 million respectively.

The MENA region recorded a 9% increase in subscribers for the quarter. This was due to continued growth from the Iran operation, which contributes 63% to the region's subscribers and increased its subscribers by 14% to 18,252,000. The disappointing slowdown of subscriber acquisitions in Sudan and Syria is mainly attributed to the economic downturn in the respective countries. Sudan increased its subscriber base to 2.66 million while Syria saw its base drop by 3% to 3.43 million subscribers.

MTN South Africa's blended ARPU decreased by 6%. This is as a result of increased penetration into lower market segments, seasonal trends and a slowdown in consumer spending. Iran's ARPU remain relatively stable notwithstanding seasonal trends and increased penetration. The decline of many local currencies against the US$ has negatively affected ARPU trends. Larger operations including Nigeria, Cote d'Ivoire, Syria and Sudan experienced significantly more resilience in local currency ARPU than reflected in the reported US$ number.

China Mobile Denies MTN Takeover Claim

­Reports in the media that China Mobile Communications Corp. (CMCC) is seeking a partner for a takeover of South Africa's MTN Group have been denied by the firm. The reports, which first emerged in the South China Morning Post, citing unnamed sources said that the company was seeking to be a junior partner in a takeover attempt.

The Chinese carrier is “not aware” of the investment plans reported by the newspaper, Rainie Lei, a spokeswoman for Hong Kong-listed China Mobile Ltd. told Bloomberg News.

The original news report had said that China Mobile had approached or plans to approach companies with a strong African and Middle Eastern presence such as France Telecom; Zain, Orascom Telecom and Etisalat.

It is possible that CMCC is looking at a purchase without using its Hong Kong listed subsidiary, and while this would be highly unusual, it would resolve a key reason given for MTN wishing to sell some of its overseas operations. MTN has subsidiaries in Iran, Syria and Sudan - all countries which the US has trade sanctions against and MTN's involvement in those countries could be causing difficulties in securing US investors. While the listed arm, China Mobile Hong Kong would face the same problems with the US government, the state-controlled parent group, China Mobile Communications would usually have no such qualms.

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China Mobile Seeks Partner for MTN Stake

China Mobile is reportedly seeking a junior partner to buy the assets of South African mobile operator MTN in Iran, Syria and Sudan, valued at about USD 2 billion, the South China Morning Post reported, citing unnamed informed sources.

The company has approached or plans to approach companies with a strong African and Middle Eastern presence such as France Telecom, Kuwait's Zain, Orascom of Egypt and Etisalat. The paper's sources said that China Mobile's attempt to buy a minority stake in the MTN units on its own was rebuffed.

China Mobile is looking overseas as its domestic urban markets become saturated and amid forecasts much of the future growth in the sector is destined to come from poorer rural areas.