Mobile operators get 90-day ultimatum

Minister Supa Mandiwanzira

Minister Supa Mandiwanzira

Business Editor
Government has given mobile network operators a 90-day ultimatum to conclude and launch infrastructure sharing. This follows prolonged discussions which include consultations that started in April last year to establish the best method of enforcing infrastructure sharing to reduce service costs and promote investment.

Discussions among stakeholders have almost always resulted in disagreements with some of the players arguing that the regulator, the Postal and Regulatory Authority of Zimbabwe (Potraz), should use the Universal Services Fund to set up infrastructure particularly in unserviced areas resulting in real benefits of sharing mobile base stations built with a common pool of money.

Other players have argued that where sharing occurs, it should only be by operators that have the same class of licence, otherwise that puts some operators at a serious disadvantage as they end up sharing with classes that compete unfairly against them.

However, Information Communication Technology, Postal and Courier Services Minister Supa Mandiwanzira told an Infrastructure Sharing workshop hosted by TelOne yesterday that mobile network operators need to move away from the colonial mentality of possessiveness by adopting infrastructure sharing to stimulate growth of the sector.

“Government is giving players in the ICT sector 90 days to conclude and launch infrastructure sharing. It is a concept which is not new to Zimbabwe but it has been tried and tested elsewhere in the world.

“It has actually been proven that infrastructure sharing results in savings of 30-40 percent. So players need to sit down and map a way forward on this concept. When an agreement has been reached, I expect to be invited to the launch.”

Minister Mandiwanzira said if the players were not ready to share, Government would go it alone as the biggest investor in the sector. Government owns TelOne, NetOne, and Powertel while it has a shareholding in Africom.

“We are not against any individual, Government is for everyone but if the players do not want to share we have options as the biggest player. If anyone thinks that we want to grab investments, you are wrong. We can go it alone and this will have a huge impact on the industry. We, however, must be able to stimulate growth collectively. Players must come up with a position and agree.”

According to experts, infrastructure sharing is the most cost-effective way towards the development of modern and technologically advanced facilities. United Kingdom consultant Chris Buist noted that there had been a 250 percent growth in MNO sharing deals elsewhere in the world. A total of 76 sharing deals had been signed but only 71 were live after five were cancelled.

Mr Buist noted that Zimbabwe was one of the few countries where regulators are pushing for sharing, “elsewhere most MNOs blame the Government for slowing the process through bad legislation”.

Minister Mandiwanzira said Government was cognisant of the fact that businesses across all the sectors were trying to survive.

“But what better way to survive through cutting costs by about 30-40 percent instead of other small percentages. Infrastructure sharing is an easier way. Let’s not look for other solutions when we have one that is immediately available,” he said in apparent reference to Econet Wireless Zimbabwe which is seeking a 15 percent price reduction from its local and international suppliers.

Minister Mandiwanzira said co-operating for infrastructure sharing is a win-for-all strategy which ensures the market develops faster. He added that players need to wake up to reality that “if we don’t deploy measures to reduce costs and develop the sector, the sector will be swallowed by technology that is coming from Sillicon Valley, India and Malaysia”.

Minister Mandiwanza also said he would suggest to the licensing regime that a percentage of every dollar invested in urban areas be deployed to rural areas as the penetration rates remain low.

“The problem arises from the high cost of network infrastructure leading to high prices, as operators seek to recover their investment. Sharing is an alternative that lowers the cost of network deployment, especially in rural areas or marginal markets.”

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