Zimbabwe’s Econet capitalises on boost in digital traffic
Rising e-commerce transactions in Zimbabwe have boosted SMS service volumes for mobile operator Econet Wireless which also reported a 90% surge in data traffic for the quarter to the end of November.
Econet is the biggest telecommunications operator in Zimbabwe and competes against Telecel and NetOne in the mobile market.
The company explained on Thursday that the onset of COVID-19 appears to be boosting digital adoption and related support services such as SMS and data.
The jump in e-commerce transactions had underpinned text message interaction between consumers and companies.
“The growth we have experienced in SMS volumes reflects the increased adoption and usage of e-commerce platforms which drives customer SMS interactions,” said company secretary Charles Banda.
SMS volumes grew by 32% in the quarter period under review. Voice was marginally up by 0.1% while data traffic surged by 89.6%.
Banda attributed the sluggish performance of voice traffic to adjustments in tariffs in July and August 2020 and noted that the category has “since started” to recover.
Industry insiders claim telecommunication companies are pressing the government to allow them to charge for service in foreign currency.
“This price correction for telecommunications services was necessary as price adjustments were lagging behind inflation, in the previous periods,” said Banda.
Although the tariff adjustments have allowed Econet to bring its service offerings in line with costs, the company says it is battling “accumulated foreign obligations” which continue “to be a limiting factor in addressing the capitalisation requirements” for the telecommunications industry.
In December 2020 Econet said the majority of its customer service employees are working remotely while digital platforms are used extensively to handle customer engagements.
Gift Machengete, director general of the Posts and Telecommunications Regulatory Authority of Zimbabwe (Potraz), has urged telecom operators in the country to prioritise “cost containment” to maintain profitability.