Morocco’s telecoms sector has long been rec-ognised as one of the most advanced in the MEA region. And with the country’s three main operators having launched LTE services this year, the sector is showing no signs of slowing the pace of its development.
Much of the success of Morocco’s telecoms sector can be attributed to its independent regulator, the ANRT (Agence Nationale de Réglementation des Télécommunications), which took an early lead in helping to liberalise the sector and, more recently, played a key role in offering 4G licences to the operators.
The regulator awarded three 20-year LTE licences to Morocco’s operators, Maroc Telecom, Meditel and Wana Corporate, in March and they have already launched services in specific areas of the country: Meditel launched the country’s first LTE service in Casablanca in June 2015, with the 4G service subsequently extended to Rabat and Sale. Wana followed shortly after, with a nationwide LTE launch announced in mid-June. Maroc Telecom launched 4G in July 2015 in all main cities of the country and it is planning to offer maximum download speeds of up to 225Mbps.
For Azdine El Mountassir Billah, general manager at the ANRT (Agence Nationale de Régle-mentation des Télécommunications) of Morocco, 4G will bring better services to the consum-ers and a brighter future for the country.
Billah told CommsMEA that the transition to 4G technology is necessary to harness growing demand for data services and increase the sector's revenues. “Specifically, 4G will allow the mobile user to enjoy low latency, they [users] will be able to stream in high definition and the call quality will be better. Besides these benefits, 4G will contribute to develop new services. According to certain analysts, 4G will increase the private use of new services such as the e-shopping, e-government, media, education, health,” he says.
In March 2014, a report from the Directorate for Studies and Financial Forecasting of Morocco (Direction des Études et des Prévisions Financières, DEPF) observed that mobile providers in more developed telecoms markets were able to achieve an average revenue per user seven to 20 times higher with 4G than with 3G. The 4G transition stands to have a notable impact on the economy as a whole, as a study by Cisco and Deloitte indicated that each doubling of the volume of mobile data usage adds approximately 0.5% to GDP.
“The 4G mobile technology should essentially guarantee an improved browsing experience. It will also guarantee better quality of service and will contribute to the modernisation of the existing mobile networks, and it will avoid saturation in the networks,” he says.
Mobile subscriber numbers in Morocco increased by 4% in 2014, while usage jumped 11% year-on-year in 2014 to an average of 92 minutes per customer. According to data from the sector regulator, total outgoing calls increased 20.4% year on year to 48.3 billion minutes, and the number of SMS messages sent increased 74.2% year on year to reach about 19.7 billion last year.
Analysts say that the market is nearing saturation, as mobile subscriber numbers topped 44.1 million at the end of 2014, indicating a mobile penetration rate of nearly 133%, one of the highest rates in North Africa. Morocco’s average revenue from mobile telephony has declined in recent years, falling 22% y-o-y in 2014 to Dh0.32 ($0.03) per minute.
In order to guarantee that telcos meet the quality requirements set by the regulator, Billah says that the agency is ready to measure the performance of the networks after the operators launch their marketing campaigns. “If we observe any problem, we will bring and request the necessary corrections. The result of this campaign will be published to the public by the ANTR,” he adds.
After investing heavily in their 4G networks, the operators may now need to look at ways of operating more efficiently in order to make a sound return on investment, according to Billah. “The telecommunications sector is very capital-intensive, as it requires constant investment. The deployment of new infrastructures is essential to offer quality services to the whole population. Currently, this deployment is expensive. The sector is confronting the following problem: The industry needs to find a balance between the need to reduce the rates, the level of competition, and the need for investment,” he explains.
Thankfully, the DEPF sets out some measures that the operators can make. Indeed, according to the DEPF’s 2014 study, Moroccan mobile operators will need to share their transmission infrastructure to reduce costs and ensure nationwide coverage.
These challenges are made more acute by so-called Over the Top players (OTTs), which continue to dent traditional operator revenues while creating vast amounts of network traffic. “The OTT services offered free of charge via Internet impact more and more on the telecoms sector at an international level, pulling a reduction in the income of the operators generated by standard services,” he says.
Billah thinks that this topic requires a “deep consideration and debate” from the regulator side and the private sector. “The explosion of digital services [demands] a new framework that guarantees the right quality terms for the users, while allowing the market players to make profitable investments,” he adds.
“This trend will require a permanent and attentive follow-up to estimate the risks, to propose and implement, at the appropriate time, actions to maintain an ecosystem favouring the private investment,” Billah said.
He sets this matter as one of the core issues that the regulator faces and adds more to the list of challenges. “The main challenges that the regulator finds are the conservation of the rules to promote healthy completion, strengthening and implementing the division of infrastructures between the operators in a fair, objective and not discriminatory way; the definition and the implementation of projects of extension and generalisation of the broadband in the whole country; and the deployment of optical infrastructures on the national territory to contribute to the reduction of the digital dividend.”
MOBILE MONEY REMAINS MODEST
When looking forward to the future investments, Billah foresees an opportunity in the mobile money sector for the operators. “Several initiatives were launched by the telecoms operators and banks. Nevertheless, the use of these applications remains relatively modest compared the potential offered by this market,” he says.
“The success that other African countries achieved with these services cannot be compared with Morocco where the rate of people with bank services exceeds 60% and the use of bank cards is more democratic with more than 10 million holders,” he adds.
According to the latest data published by the GSMA, mobile money services are now available in 61% of the world’s developing countries. In the past five years, mobile money services have spread across much of Africa. As of December 2014, there were 255 live mobile money services in 89 markets compared with 233 live services across 83 markets at the end of 2013.
Juniper Research sees Africa as the leading market that will benefit from mobile money transfer services, as several African mobile operators are now generating more than 10% of their revenues from mobile money. The research company forecasts $2b in revenues for this year and $4b annually 2018, globally.
Billah remains positive and sees Morocco as a country where these services will continue the growth forecasted by the GSMA.