Econet scores as demand for broadband spikes in Zimbabwe
Data consumption is increasing in Zimbabwe – despite ongoing economic hardship, including fluctuation in currency value, power outages and tariff adjustments.
In September, the Posts and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ) approved a cost-based tariff adjustment for operators.
Econet Wireless said the tariff is based on the telecommunications price index (TPI) for voice, data, SMS and USSD.
The company reported that in the half year to end August, it raised revenues by 95% to ZWL29.6-billion (about US$290-million at the official rate of about $1:ZWL100 exchange rate).
It said this had been driven by “the increased contribution of data” services.
Econet Chairman James Myers added, “Data revenue grew by 136% and our voice services revenue increased by 92%.”
Demand for mobile broadband has remained strong, and during the period under review, Econet “upgraded 4G network” in Harare and “this increased the data browsing speeds by 1.5 times”.
Additionally, eight new base station sites were commissioned by Econet across Zimbabwe, while the plan is now to commission an additional 215 new LTE sites.
Econet expects to “start our 5G journey as we pivot to the next stage of our digital evolution” in the next few months, Myers said.
With Zimbabwe’s economy struggling under currency challenges and steep costs bloated by inflation, Econet had instituted “aggressive cost management”.
This resulted in its earnings before interest, taxation, depreciation and amortisation (EBITDA) margin improving to 55% from 47% in the comparative period.
However, capital investments for the company “remained severely constrained at 3% of revenue against an industry benchmark of between 10% and 15% of revenue”.
This was on account of “foreign currency unavailability” which hampered continuous network upgrade and improvements.
“This has not been possible in the current environment, due to the unavailability of foreign currency,” the company added.