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Higher Data Penetration Creates New Opportunities in South Africa

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Cloud services, mobile advertising and mobile apps will be some of the highest growth segments in the South African market, contributing half a billion dollars in new revenue from 2012 2017, according to a new report from Pyramid Research.

"South Africa is a key market in the AME region not only because of its size, level of income and maturity, but also because it is the home for key players in the market, MTN and Vodacom in particular," says Pyramid Research Analyst at Large, Jan ten Sythoff.

It is also the landing place of many submarine data cables connecting Africa internationally, which is lowering the cost of broadband and increasing the bandwidth both locally and across much of the continent. Data is the key driver for telecom operators in South Africa, and it underpins three major areas of growth: mobile apps, cloud services, and mobile advertising.

Each of these three areas is relatively small, but demonstrate attractive growth rates; furthermore, oftentimes operators see these areas as strategic, having additional benefits such as as enhancing the brand and supporting growth in other areas and improving their competitive positioning, he notes.

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Tags: South Africa