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4G to remain primary source of mobile phone connectivity by 2033 despite emergence of 5G – Fitch Solutions

Source The Ghana Report

4G platforms will remain the primary source of connectivity in Ghana by 2033, owing to greater smartphone affordability.

This is despite the emergence of the 5G platforms.

According to Fitch Solutions, only 21.2% of connections will be 5G by 2033, with 4G expected to remain dominant due to handset costs, as 4G handsets are currently the most commercially accessible to consumers.

The establishment of a wholesale 5G national network in Ghana is aimed at negating the risk of over-investment through asset duplication, which would likely have resulted from the traditional approach of allocating licences to multiple operators.

The Minister of Communications and Digitalisation, Ursula Owusu-Ekuful, has confirmed plans to build a wholesale 5G national network, rather than allocating individual 5G concessions to existing or new operators.

The new open access network will be constructed by a consortium of local entities and two players from India, alongside Nokia and Microsoft. The project aims to enhance digital inclusion through the provision of low-cost network infrastructure services in the sectors of education, healthcare, machine-to-machine (M2M) communication and payment services.

However, Fitch Solutions said the wholesale open access network model has met with little success in other markets, most notably in Mexico where the state-owned Altan Redes 5G network has consistently operated at a loss and is technically bankrupt.

“We are also watching similar developments in Malaysia, where the Digital Nasional Berhad (DNB) project has fallen behind schedule. Established in March 2021, the project is being led by a special-purpose vehicle company owned by the government, which is collaborating with six mobile operators and service providers that have proved reluctant to participate. A change in government, issues with the vendor selection process and a decision to establish a second wholesale 5G network have further clouded the long-term sustainability outlook for the project”, it pointed out.

In Ghana, Telecel Ghana and AT Ghana are both participating in the project as the Next-Gen Infrastructure Company (NGIC), which has been granted a licence to deploy and operate the shared 5G infrastructure.

India-based Radisys (owned by market disruptor Reliance Jio) and Tech Mahindra are involved in the project. Additionally, Ghana-based Ascend Digital and K-Nat are also part of the consortium. The combined entities are reportedly planning to invest $145 million in capital expenditures over the next three years.

Fitch Solutions said there is limited information available on the vendor selection process from the government, adding, MTN’s involvement has not been clearly outlined.

“It appears most likely that MTN will be required to use the shared infrastructure once there is no spectrum available for individual allocation”, it stressed.

MTN remains the dominant market player in Ghana with 74.5% of the mobile market share at the end of March 2024.

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