Kenya’s growing middle class is becoming the target of foreign mobile-phone companies, with companies like Bharti and the U.K’s Vodafone Group PLC (NASDAQ: VOD) competing in the market, reports Sarah Childress for The Wall Street Journal.
Africa is home to one billion consumers, and the population is growing. Consumer spending has increased at a compounded annual rate of 16% between 2005 and 2008, and within five years, around 220 million Africans will be joining the middle class.
According to McKinsey & Co., Africa has 400 million mobile users, and by 2012, rural voice services will provide $12 billion to $15 billion in telecommunications revenue.
Numbers like that are an amazing opportunity for telecom corporations around the world. What Vodaphone and Bharti are doing could well become the norm. Since you don’t know who will try and get some African market share next (or do you?), consider a telecom ETF to own them all:
- iShares Dow Jones U.S. Telecom (NYSEArca: IYZ)
- Wireless HOLDRS (NYSEArca: WMH): VOD is 6.9%
- Vanguard Telecommunication Services Sector (NYSEArca: VOX)
For more information on the telecom sector, visit our telecommunications category.