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Omdia View: January 2024

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In January 2024 highlights from the telecoms industry in the Middle East and Africa included a $200 million fintech deal between MTN and Mastercard as well as 5G network trials by Telecom Egypt.

Meanwhile, Etisalat by e& launched new fiber plans supporting gigabit speeds to enhance its Internet connectivity for fiber-to-the-home (FTTH) customers in the UAE and Aramco Digital announced a collaboration with Intel to establish Saudi Arabia's first open RAN development center.

Here are Omdia's latest Middle East and Africa highlights.

Mastercard finalizes MTN Fintech $200M shares acquisition

by Thecla Mbongue, Omdia research manager for the Middle East and Africa.

MTN and Mastercard signed definitive agreements for a minority investment of up to US$200 million in MTN Group Fintech unit at a valuation of $5.2 billion on a cash and debt-free basis.

The transaction was originally announced in August 2023 and complements the larger commercial relationship between MTN and Mastercard.

Back in 2021, Mastercard and MTN Group sealed an e-commerce partnership whereby Mastercard virtual payment solutions were linked to MTN Mobile Money (MoMo) wallets.

MTN Fintech services include mobile money services, insurance, airtime lending and e-commerce. The group had 63.5 million mobile money users in the third quarter of 2023, with Ghana and Uganda combining 40% of this user base.

MTN's fintech half-year revenue was R10 billion ($533 million) in the first half of 2023, up by 22% annually.

This financial influx will support MTN's fintech strategy. The group intends to reinforce its fintech offering, notably MTN's involvement in e-commerce.

The operator has, for instance, launched its MoMo card in Uganda and Nigeria. The card is a virtual Mastercard debit card, which enables online payments for MTN's Mobile Money users.

Facilitating global online payments to customers is crucial to all fintech players in Africa, where credit/debit card penetration is still low.

MTN is on par with competitor Airtel, which also partnered with Mastercard for virtual debit cards. Orange, on the other hand, has favored physical Orange Money cards in partnership with Visa. Orange Madagascar, however, also offers a virtual card option branded "Visa Akory."

The percentage of shares bought is yet to be announced, but the stake is reportedly a minority one.

MTN stated it planned to seal more fintech-related strategic partnerships and targeted to attract long-term investors for up to 30% of MTN Group Fintech.

In January 2024, MTN also extended its partnership with its wallet platform provider Ericsson.

Orange Madagascar renews operating license, plans network expansion

by Danson Njue, Omdia senior research analyst, Africa markets.

Orange Group announced that it had renewed its operating license in Madagascar for a period of 15 years, with plans to expand its network coverage to achieve a population coverage of about 90% by end of 2024.

According to Orange Madagascar, the operator was the first to be awarded a global license after paying 30 million ($32.4 million).

The global license is a technology-neutral license introduced by the government in April 2023 to enable operators to offer all telecommunication services to the retail and wholesale market segments of mobile and fixed technologies.

In January 2023, Orange signed a ten-year agreement with Canadian wireless infrastructure provider NuRAN Wireless to expand its network coverage in rural and unserved areas through the deployment of 500 2G and 3G sites.

Orange has been operating in Madagascar for the last 20 years and is currently the third largest operator by subscriptions market share, with 3.3 million subscriptions by the end of 2023, according to Omdia research.

The operator offers 2G, 3G and 4G services, and plans to introduce 5G services by the end of the year in line with the group's plans to deploy 5G across its African operations by the end of 2024.

Omdia believes that the new global license framework by the Malagasy government will promote growth in the country's telecoms market by enabling operators to expand service offerings by deploying new services in the market.

Orange Madagascar plans to expand its network to achieve a population coverage of about 90% by end of 2024.   (Source: Orange media center)
Orange Madagascar plans to expand its network to achieve a population coverage of about 90% by end of 2024.
(Source: Orange media center)

Telecom Egypt begins 5G trial operations in five locations across Egypt

by Walaa Ibrahim, Omdia senior analyst for the Middle East and Africa.

Telecom Egypt (TE) has announced the initiation of experimental operations for 5G services across five locations in Egypt.

This move aims to evaluate service quality while anticipating the financial impact of 5G services, which is expected to be reflected in TE's financial results by the end of 2024.

In January, the National Telecommunications Regulatory Authority (NTRA) finalized a $150 million agreement with Telecom Egypt, granting a 15-year license for the provision of 5G services.

The introduction of 5G services in Egypt is intended to accelerate the nation's digital transformation efforts. It promises enhanced download speeds, increased network capacity and seamless connectivity for numerous devices, marking a significant step forward in Egypt's telecommunications landscape.

Etisalat by e& launches high-speed fiber plans, introducing 5G and 10G speeds

by Walaa Ibrahim, Omdia senior analyst for the Middle East and Africa.

Etisalat by e& has introduced two new FTTH plans – 5G and 10G packages – aimed at significantly enhancing Internet connectivity for consumers in the UAE.

With the rollout of these plans, Etisalat by e& asserts itself as the first provider in the UAE to offer speeds exceeding 1 gigabit per second.

The eLife 5G plan, priced at AED1,799 ($490) per month excluding VAT on a 24-month plan, offers download speeds of 5 Gbit/s. Meanwhile, the eLife 10G plan, priced at AED2,699 per month excluding VAT on a 24-month plan, delivers connections at 10 Gbit/s.

Both plans include unlimited calls to local and national fixed lines, along with full home Wi-Fi for comprehensive coverage throughout customers' homes.

Subscribers to these plans will also gain access to a diverse range of entertainment options, including over 300 TV channels comprising free-to-air channels, 4K channels and premium content such as OSN CricLife, GolfLife, Starzplay Sports and Abu Dhabi Sports Premium Channels.

Aramco Digital and Intel to establish Saudi Arabia's first Open RAN development center

by Walaa Ibrahim, Omdia senior analyst for the Middle East and Africa.

Aramco Digital, a subsidiary focusing on digital and technology solutions within Saudi Aramco, has announced a collaboration with technology company Intel to establish Saudi Arabia's inaugural Open RAN Development Center.

The center aims to foster innovation, advance technological capabilities, and contribute to the digital transformation landscape in the kingdom.

The joint effort between Aramco Digital and Intel seeks to expedite the development and implementation of open RAN technologies.

This initiative aims to support the kingdom in building resilient and adaptable telecommunication infrastructure to drive digitization across various industries, aligning with the goals outlined in Saudi Arabia's Vision 2030 for technological progress and economic diversification.

Open RAN, a dynamic approach to wireless network architecture, offers enhanced flexibility, interoperability and innovation. Leveraging Aramco Digital's insights into Saudi Arabia's developmental needs and Intel's expertise in open RAN technologies, this collaboration is poised to make significant strides in this field.

A key component of this partnership includes the establishment of an innovation hub – the Open RAN Development Center – where Aramco Digital and Intel engineers, researchers and industry experts will collaborate.

Additionally, the center aims to contribute to the growth of local talent by providing training and hands-on experience in open RAN and edge computing technology.

Furthermore, this collaboration is expected to have a positive economic impact by fostering technology-driven initiatives and support Vision 2030 objectives. It also aims to facilitate global collaboration by integrating Saudi Arabia into the broader landscape of open RAN and edge development and deployment.

Follow Connecting Africa on our new X account @connect__africa to get the latest telecoms and tech news across Africa.

You can find Omdia's full Middle East & Africa News Digest here.

For more information about Omdia's consulting capabilities, contact them directly at [email protected] or reach out to the Omdia analysts by emailing [email protected].

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