Connecting the country: Rising investment in telecommunications

Jul 11, 2024 4:26:21 PM

How has is SA's telecommunications sector fairing?

By Koketso Mamabolo

Innovation and developments in the tech industry can have far reaching impacts on all other industries. The products and services which emanate from the sector have the power to change how businesses operate and how consumers live their lives. We all use technology, whether directly or indirectly, and in the last decade the pace of change has created a host of opportunities for investors to get involved and for businesses to take their operations to the next level.

The digital landscape

With much of the focus in the last year being on the incredible developments in artificial intelligence, the progress in other sub-sectors has gone under the radar. The world is changing before our eyes. E-commerce has come to the fore; digital payments are democratising access to financial services and over 70% of South Africans were using the internet in some form at the beginning of 2023.

72.3% - Percentage of SA population using the internet
42.9% - Percentage of SA population using social media
27.7% - Percentage of SA population not using the internet

(Source: Data Portal Digital Report 2023)

Telecommunications

The International Mobile Telecommunications (IMT) spectrum auction, which was concluded in March last year, raised almost R15-billion and will decrease communication costs, enhance competition in the telecommunications sector and ultimately open the opportunities for greater connectivity. The telecommunications industry is a perfect example of the growth the technology sector is experiencing and it could be argued that connectivity underpins much of the economic activity in, similar to primary sectors such as mining.

In 2022, the telecommunications industry saw its total revenue rise by 3.94% from the previous year. Despite a decline in 2021 the last five years has seen consistent growth in the sub-sector, exceeding the R200-billion mark in three of the last five years. Mobile services contributed more than 50% of the revenue in 2022.

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