Radar | Jul 31,2021
The public persona of Frehiwot Tamiru, CEO of the state owned Ethio telecom, may appear charming, cheerful and soothing. Behind closed doors in the boardrooms, she has proven to be a hard nut to crack. Both friends and foes acknowledge her competence in transforming a century-old public company to survive in the cut-throat competition of the 21st century.
Anwar Soussa, CEO of Safaricom Ethiopia Plc, has glimpsed the tough woman behind a tender appearance. His team has yet to launch a mobile service in April this year his parent company agreed after winning a licensing bid last year. Anwar pushes forward to meet government-set rollout plans for the first year of operations with progress in infrastructure sharing negotiations with Frehiwot.
The duo are set to strike a deal after months of back and forth over the financial aspects of sharing Ethio telecom’s towers. The Ethiopian Communications Authority (ECA), under Balcha Roba, has arranged a meeting between the two executives to settle disagreements over whether lease payments were to be made in foreign currency as Frehiwot demands. She offered to lease towers in densely populated markets for over 2,000 dollars a month for every tower. It is more than the ex-ante tariff set by the Authority at 1,700 dollars for Class I tower rental.
Anwar has requested access to one-seventh of the state-owned operator's tower sites.
Established three years ago, the Authority is responsible for brokering a deal if disputes emerge between operators. It may intervene if its involvement is requested by at least one party.
Frehiwot and Anwar have made progress with the terms of the agreement and are expected to ink a deal soon, people close to the process told Fortune. The deal also includes an interconnection agreement, which involves the setting of interconnection fees subscribers pay when calls or texts are made over the two operators' networks.
“We're still in progress,” Tewedaj Eshetu, communications manager of Safaricom Ethiopia, told Fortune.
The executives of the incumbent Ethio telecom were reluctant to provide information.
"We'll announce the details after signing the deal," said Mesay Woubshet, head of communications at Ethio telecom.
Anwar and his team had initially planned to launch commercial operations in April after the operator was granted a 15-year license bidding 850 million dollars. It has yet to meet the deadline. People close to the matter expect the operator to launch services in September. Tewedaj declined to disclose the official launch date but said it would be before the end of the year.
Officials at the Authority say Safaricom Ethiopia will not face penalties due to the delays as long as the company manages to meet targets set for its first year of operation. Safaricom Ethiopia's network is expected to reach a quarter of the population by next April and cover all special economic zones. Other commitments include reaching half of all airports and covering a third of major roads and highways.
"We haven't received any requests for an extension of the commercial launch date," Balcha, director general of the Authority, told Fortune.
Anwar is moving ahead with its infrastructure development project in addition to the pending deal with Frehiwot. Three months ago, he contracted Huawei and Nokia to facilitate the installation of infrastructure on building-tops, of which Nokia will carry out 60pc. A week ago, Safaricom Ethiopia invited companies to supply VSAT equipment and bandwidth for its planned satellite solution. The company plans to deploy the technology, which provides high-speed broadband satellite communications, to connect rural areas. Equipment valued at 350 dollars has been brought to the country, sources disclosed to Fortune.
A few months ago, Anwar and his chief technology officer, Pedro Rabacal, pledged to introduce video calls and multimedia messaging services. They plan to offer these services in five cities, including Addis Abeba, Hawassa and Dire Dawa. Safaricom Ethiopia is also set to benefit from a bill under preparation by regulators at the central bank, which would allow foreign investors and overseas companies unrestricted opportunities in digital financial services. It will likely be one of the frontrunner beneficiaries by introducing its successful M-Pesa mobile money platform to the Ethiopian market.
Ethio telecom has got a head start. Since it was introduced last year, its Telebirr mobile money platform has registered over 18 million subscribers and facilitated transactions valued at close to 10 billion Br. Last week, the central bank gave the operator the green light to begin offering micro-credit services on Telebirr. However, there are still details to be worked out before the launch.
“We're awaiting clarification from the central bank,” said Mesay.
Frehiwot and her executives have been in a frenzy to roll out new services before getting their first taste of competition. Last month, she launched a pre-commercial 5G network, making Ethiopia one of only a handful of African countries to avail of the network.
Safaricom Ethiopia plans to begin operations with 4G network services. The path to that begins with charming the formidable lady at the helm of Ethio telecom.
PUBLISHED ON
May 28,2022 [ VOL
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1152]
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