Friday, 31 August 2012

Is CAPCOM big enough to make it in Nigeria?


In a logical, and perhaps not unexpected, move three Nigerian Code Division Multiple Access (CDMA) operators plan to merge their operations to form a unit with greater mass and momentum, and so better able to take on the dominant GSM players.

Multilinks, Starcomms and MTS First Wireless are to form a single CDMA network branded CAPCOM.  

Will CAPCOM will have sufficient muscle to reverse the long-term decline in CDMA subscribers? Or is it doomed from the outset to be smaller than its remaining CDMA-rival Visafone – and both will still lack the muscle needed to give the established GSM operators a run for their money? Indeed, CAPCOM’s starting position with around 1.4 million subscribers still leaves it well short of rival Starcomms with around 2.5 million.

Even if one could merge all the extant CDMA operators, the combined outfit with nearly 4 million subscribers would still be a long way short of the smallest GSM operator Etisalat which at the end of Q1 2012 had some 11.9 million subscribers, and was busy eyeing greater things.

Nigerian mobile operators showing CAPCOM market share as at Q1 2012
Source: NCC

There’s a chapter discussing the merits of GSM v. cdma in the ‘Africa Mobile Factbook 2012 – click here to download a copy. I know its a tad tangential, but somewhere in all this could the potential for an MVNO - see MVNOs in the Middle East & Africa - also a free download.

The only operators with smaller bases, according to the NCC, are Nitel's M-Tel (GSM) and ZoomMobile (cdma), both of which are notionally defunct.

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