Malawi: Malawi Communication Profile

Malawi is one of the world’s least developed nations, but next a poor economic performance during the last two years GDP is expected to grow at above 5% for 2013. Telcos have been affected by the currency devaluation imposed in mid-2013, which has delayed their ability to fund network upgrades. In addition, the government in mid-2013 instituted a tax on internet services, the additional cost of services being passed on to consumers.

Mobile penetration remains very low in comparison to the African average, which allows for considerable opportunities for further increase. The market remains a duopoly between Bharti Airtel (formerly Zain) and Telecom Networks Malawi (TNM) given the failure of the potential third mobile operator, G-Mobile, to launch services. The operator’s continuing delays encouraged the telecom regulator to revoke the company’s licence in 2013.

To encourage additional market competition, the government has followed in the footsteps of several of its neighbours and introduce a converged licensing regime which presently allows the two fixed-line operators, Malawi Telecommunications (MTL) and Access Communications (ACL) to enter the mobile market as well. Both are by presently operating CDMA-based fixed-wireless networks which support full mobility and broadband access using EV-DO technology.

The internet sector is reasonably competitive with 15 licensed ISPs, but the limited availability and high cost of international bandwidth has held back increase and kept broadband prices high. DSL services are available, and several ISPs are extending their WiMAX wireless broadband footprints. The two incumbent mobile networks have launched third generation (3G) mobile services based on UMTS/HSPA technology.

A national fibre backbone is being implemented, and the country recently gained access to international submarine fibre optic cables for the initial time at the same time as a transit link via neighbouring nations was completed. Provided a suitable regulatory regime is put in place, this will bring down the cost of international bandwidth and deliver a boost to the broadband market.

Estimated market penetration rates in Malawi’s telecoms sector – end 2013

(Source: BuddeComm based on various sources)