Telecoms Contribution To GDP Rises N1.6trn Q2 | Independent Newspapers Limited
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Telecoms Contribution To GDP Rises N1.6trn Q2

MTN, Shares; telecoms
Posted: Sep 5, 2016 at 5:58 am   /   by   /   comments (0)

The telecommunications sector contributed N1.58 trillion to the gross domestic product (GDP) in the second quarter of 2016, or 9.8 percent, according to data released by the National Bureau of Statistics (NBS).

The NBS made the revelation in its second quarter Nigerian Telecommunications (Services) Sector Report released over the weekend.

The rise, NBS says, represents an increase of one percentage point relative to the previous quarter. It is also the largest contribution to GDP made from this sector in the rebased period, which emphasises that growth in telecommunications has remained robust when compared to total GDP.

The share of telecommunications in total real GDP had declined throughout 2010 to 2014, but for the last five quarters growth in telecommunications has been higher, meaning the trend has reversed.

The NBS report also reveals a rise in the number of telecom subscribers over the years with GSM subscription leading the growth. While MTN, Etisalat and Airtel had chequered growth in the review period, Glo had a steady growth.

“The total number of subscribers has increased rapidly over the past decade. At the end of 2005 there were 19.5 million subscribers, but by the end of 2015 it had risen to 151.01 million, which is equivalent to an increase of 13.1 million every year.

However, growth has been declining more recently, possibly as a result of high market penetration leaving less room for large expansion,” NBS said.

In June 2016, which is the end of the second quarter, NBS said there were 149.8 million subscribers compared with 148.9 million in June 2015, which represents an increase of 0.69 percent. The yearly increase in total subscriber numbers has been decreasing steadily for the past year; in June 2015, the year on year increase was 12.05 percent. However, after falling between January and April 2016, the number of subscribers began to increase again, and in June the number was 0.71 percent higher than at the end of the first quarter in March.

This increase, NBS further reveals, is despite a sharp drop in CDMA subscribers; between June 2015 and June 2016, the number fell from 2,105,981 to 454,092, a decrease of 78.44 percent.

Although CDMA remains the second most popular technology type, this decrease has meant that the GSM technology type has entrenched its position as the dominant provider of mobile phone services.

According to the statistics bureau, in June 2016, the total number of GSM subscribers was 149.1 million, an increase of 2.7 million, or 1.84 percent relative to June 2015.

The second quarter of 2016 saw a partial reversal of trends that had been recorded since August 2015. After declining between then and March 2016, the number of MTN and Etisalat subscribers began to increase again; the number of MTN subscribers rose from 57.04 million to 58.40 million between March and June 2016, and Etisalat subscriber numbers rose from 21.87 million to 22.46 million over the same period.

These changes represent quarter on quarter growth rates of 2.39 percent and 2.71 percent, respectively, although year on year growth rates were still negative, at -7.01 percent for MTN and -1.67 percent for Etisalat.

Airtel also witnessed a reverse in trend. In the second quarter of 2016 the service provider recorded growth of -5.57 percent, following consistent positive growth since August 2014. Nevertheless, the year on year growth was positive at 8.17 percent, and there was a slight increase between May and June of 0.44 percent. Airtel ended the quarter with 31.97 million subscribers.

By contrast, Globacom continued its uninterrupted growth in subscriber numbers. With the highest quarter on quarter growth and year on year growth rates of 4.95 percent and 16.20 percent, respectively. Globacom also recorded the largest increase in absolute terms by both measures. At the end of the second quarter Globacom had 36.32 million subscribers.

As a result of these trends, Globacom increased its share of total subscriptions to 24.35 percent, from 23.48 percent at the end of the previous quarter and 21.34 percent a year previous.

Both MTN and Etisalat also increased their percentage share of subscribers relative to the previous quarter; MTN’s share increased from 38.70 percent to 39.15 percent and Etisalat’s share increased from 14.84 percent to 15.06 percent.

However, both providers nevertheless recorded a decrease in their share relative to June 2015, when the shares for MTN and Etisalat were 42.88 percent and 15.60 percent, respectively.

Airtel was the only provider to record a decrease in its share relative to the previous quarter. In June 2016, its share was 21.44 percent compared to 22.98 percent in March.