Connectivity Is The New P&L, Says South Africa

South Africa’s ICT sector grew just 0.8 per cent in 2025 and every rand of that growth came from connectivity. On the surface, that is a story about a mature market running out of room. However, upon closer examination, it is something far more useful: an early-warning system for every technology leader on the continent. A new CIO Africa Research deep-dive into ICASA’s 2026 State of the ICT Sector report argues that the forces repricing South Africa’s market are already moving north, on a one-to-three-year lag.

Start with the number the whole report turns on. National mobile traffic rose 21.5 per cent in 2025 while mobile services revenue fell 7.9 per cent. Usage and revenue have decoupled, and not cyclically. SMS revenue collapsed 37.9 per cent in a single year, prepaid messaging nearly halved, and roaming fell 12.4 per cent, while everything data-shaped grew: fixed internet and data revenue up 16.2 per cent, fibre subscriptions up 22 per cent. ICASA is blunt about the cause: OTT platforms – WhatsApp, Telegram, and Signal – have swallowed legacy voice and messaging while inflating demand for the data that carries them. Operators now move more value than ever and keep less of it. What they are shedding is migrating to platforms, cloud providers and digital commerce, most of them global.

Where Is The Money Going? 

Follow the money and the same shift appears in capex. Total telecom investment fell for a third straight year, to R28.4 billion, but within that shrinking envelope mobile network spend dropped 21 per cent while fixed broadband investment rose nearly 12. Fibre subscriptions passed 3 million; fixed wireless jumped roughly 40 per cent. For CIOs, fibre-versus-FWA competition creates real procurement leverage for the first time in years. For vendors, the operator buying centre has moved. RAN-adjacent wallets are shrinking; fibre, FWA and open-access wallets are growing.

Beneath the aggregates sits a two-speed nation. 4G reaches 99.5 per cent of South Africans and 5G climbed to 58 per cent population coverage. But urban Western Cape 5G sits at 89 per cent against rural Eastern Cape’s 7. Only 17.4 per cent of households have fixed internet at home. The reason is price: a 2GB mobile basket costs R152, below the affordability benchmark, but entry-level fixed broadband runs R309, which is 66 per cent above it, the least affordable in BRICS. Mobile is competitive; fixed remains a structural-cost problem. Any product strategy built on “the connected consumer” now has to specify which one; the fibre-connected urban household or the prepaid-mobile majority.

Centering The Economy 

Then there is the cost of simply keeping networks alive. Infrastructure theft costs rose 189 per cent in a year to R201.5 million, overtaking vandalism as the dominant security line, while backup-power spend roughly doubled. Security and energy are now crowding out expansionary capex. Every SLA, colocation decision and edge deployment in the region has to price in physical security and energy autonomy which is also, the report notes, a fast-growing market of its own.

There is a control dimension to the P&L story, too. Who holds the businesses that now sit at the centre of the economy? As the value migrated, the answer narrowed: in telecommunications, Black representation in top management fell 33.6 per cent in a single year and Black female representation by 42.5 per cent, the report’s most uncomfortable finding, and a transformation reversal regulators are unlikely to ignore. The contrast with broadcasting is pointed. That sector shrank on revenue but moved sharply the other way on leadership, lifting Black ExCo representation and Black women. Same country, same year, opposite directions. It reads less like a trend and more like a choice.

Two more signals round out the picture. IoT was the strongest growth line anywhere in the data. Machine-to-machine subscriptions up 12.5 per cent to 15.8 million, roughly one machine SIM for every four human subscribers. And a competitiveness warning light: South Africa’s speeds keep improving in absolute terms, yet its global fixed-broadband ranking fell 13 places in one year to 115th of 152, improving while falling behind, as India, Brazil and East African challengers accelerate. Meanwhile the busiest regulatory window in a decade is rewriting the rules, led by a recommended market enquiry into OTT and streaming platforms that regulators across the continent will study and copy.

Reading The Bottom Line 

The report’s bottom line is strategic: the winners of the next cycle will not be those who sell connectivity, but those who build on top of it and those who solve the sector’s three chronic frictions, fixed-broadband affordability, rural coverage economics and infrastructure resilience. Each friction is a market.

For technology leaders in Nairobi, Lagos, Accra and Cairo, the sharpest line in the analysis is about timing. Every dynamic in this report from OTT substitution, the fibre pivot, resilience costs, IoT scale-up, streaming regulation, is arriving in their markets on a one-to-three-year lag. South Africa simply published the data first. The question the numbers pose is not whether these forces reach the rest of Africa, but whether its technology leaders read the pattern book well before the repricing arrives, or after.

Download the report here.