ECONET Wireless – Zimbabwe’s largest mobile operator – yesterday warned that lack of adequate investments in its telecoms infrastructure due to prevailing foreign currency shortages will result in deterioration in the quality of its service.
Of late, there has been a growing consumer complaints about poor service delivery by Econet Zimbabwe particularly its mobile money transfer service platform, EcoCash.
Most consumers have also complained about spotty coverage and dropping calls. Econet accounts for nearly 70 percent of the market share.
However, this situation is not peculiar to Econet alone as some local mobile operators are also facing similar challenges.
Zimbabwe is facing foreign currency shortages, which has seen it struggling to pay for essential imports such as drugs, fuel and electricity.
Foreign currency shortages are largely emanating from Zimbabwe’s failure to attract foreign investment and loans as well as subdued exports against huge imports.
“Over the past three years, the company has not been able to sufficiently reinvest to maintain our telecoms infrastructure,” said Econet chairman Dr James Myers in a statement accompanying its financials for the half year ended August 31.
“The continued under investment will inevitably result in a deterioration in service quality if it continues, a fact that the board and management has brought to the attention of POTRAZ (Postal and Telecommunication Regulatory Authority of Zimbabwe and Government.”
Econet said, while it had been able to continue getting support from its equipment supplies; ZTE of China and Ericsson of Sweden without security of payments, this has resulted in a build-up of foreign currency obligation, which needs to be settled.
It also expressed concern over sub economic tariffs, now among the lowest in Africa.
“This is at a time when the country is experiencing up to 18 hours of power outages and our network is running almost exclusively on diesel generators, a situation which is clearly untenable.
“The company and other networks continue to implore POTRAZ and the Government to consider the impact of these debilitating challenges on the viability of the sectors and the negative impact on our ability to offer quality service to customers.”
During six months to August this year, Econet recorded a 45 percent increase in revenue to $1,3 billion from $866,5 million during the same period last year (on a hyperinflation adjusted basis) after adding subscribers by 10 percent.
A growth to 12,6 million subscribers saw Econet’s market overall share expanding to 69 percent from 66 percent in the previous comparable period. Market share (industry voice tariff) grew to 80 percent from 71 percent, while market share (data tariff) slightly rose to 72 percent from 71 percent.
Core operating profit jumped 90 percent to $522 percent from $275 million after the management implemented “appropriate” cost efficiency measures.
