Cran hit by declining subscriptions

Namibia’s telecommunications sector took a significant hit in the final quarter of 2022, with total investment declining and subscriptions for both mobile and terrestrial services dropping.

Investment in the telecommunications sector declined from N$397 million in September to N$88 million at the end of December last year.

Communications Regulatory Authority of Namibia (Cran) boss Emilia Nghikembua said this is a cause for concern, as it might lead to a deterioration in service quality and ultimately affect consumers.

“Total investment in the telecommunications sector declined during the fourth quarter of 2022, which in the long run will result in poorer service quality due to congestion in some areas,” says Nghikembua.

Latest data from the regulator show a significant decline in digital mobile subscriptions of 22% and that of terrestrial subscriptions 33%, compared to the same period in 2021.

In contrast, DSTV subscriptions saw a minimal decline of only 1%. This decrease is concerning as it might indicate a shift in consumer behaviour and a preference for alternative forms of media consumption.

Despite this decline, the broadcasting sector experienced a 6% (over N$238 million) growth in revenue during the fourth quarter of 2022 compared to the same quarter in the previous year, with total revenue for advertisements increasing significantly at 35% to N$22,8 million. However, this accounted for only 6% of the total revenue generated by broadcasters.

A survey conducted by Vision Africa Research Services last year revealed that radio was the preferred medium for receiving news among consumers, followed by the internet and television.

WhatsApp was the preferred instant messaging application for 97% of respondents, while 89% said they preferred to abstain from online purchases.

The traffic data for the fourth quarter show a slight overall increase in mobile minutes, with growth rates ranging from 4% to 29% compared to the same period in the previous year.

However, Cran data show a decline in international mobile minutes, potentially driven by the use of over-the-top services for voice communication.

Mobile data usage increased by 8%, while the number of SMSes sent remained constant during the review period. Fixed-line outgoing minutes declined by 8%, consistent with the trend of decreased demand for fixed-line subscriptions for voice communication and a preference for data-driven services.

Meanwhile, the postal sector experienced a notable drop in the rental of letterboxes in the fourth quarter of 2022, with only 38% currently rented, representing a substantial decline of 29% from the third quarter of 2022.

“This is due to more customers changing to digital mail,” said Nghikembua.

Additionally, there was a decrease of 8% in the number of occupied private bags during the same period.