April 30, 2024
Econet renews push for viable tariff regime
ECONET Wireless (Econet) says viable pricing of telecommunication services remains a key factor for the continued growth and sustainability of the industry.
In a statement accompanying the company’s financial statements for the half year ended August 31, 2023, Econet’s chairman, James Myers, said the current volatile operating environment continued to significantly erode the benefits of any tariff adjustments.
“Regular and effective tariff reviews that track inflation and exchange rate movements are critical to ensure the viability and sustainability of the sector. According to the Postal and Telecommunications Regulatory Authority of Zimbabwe, voice and data tariffs remain at discounts of 58 percent and 88 percent respectively to the region,” Myers said.
This comes as the company reported growth in revenue for the period under review attributed to a volume growth of 24 percent and 25 percent for voice and data, respectively.
During the period, the group incurred exchange losses amounting to $375 billion, representing 34 percent of revenue against a prior period comparative of 39 percent.
However, the group incurred a loss before monetary adjustment of $24 billion against a prior period comparative loss of $40 billion resulting from inflationary pressures in the economy that affected profitability.
“Exchange losses from US dollar denominated liabilities driven by the weakening local currency continue to have a negative impact on the group’s performance. During the period, the group incurred exchange losses amounting to $375 billion, representing 34 percent of revenue against a prior period comparative of 39 percent,” Myers said.
He added that transforming Econet’s business model to a fully-fledged digital service provider remained an urgent imperative.
“We will continue modernising our network infrastructure to unlock opportunities presented by emerging technologies to broaden and diversify our service offering.
“Artificial intelligence and process automation will be pivotal in improving operational efficiencies and customer service delivery,” Myers said.
“We successfully leveraged the partnerships we have with our major equipment vendors to modernise our network after several years of under-investment. From an investment level of less than five percent of revenue in previous years, capital investments for the period rose to 24 percent of revenue in the period under review.
“As a result, we modernised 252 base station sites in the first quarter, and 439 base station sites in the second quarter, covering Harare and Bulawayo. The network modernisation entails replacing old equipment that had limited capacity or is no longer supported by the vendors.
“The modernised equipment has better performance, capacity and coverage,” he added.
This also comes as Econet is this year marking its 25th anniversary.
“As we celebrate this milestone, we reflect on how resilient and agile our business has been, evolving from a mobile voice telephony operator to becoming a digital service provider that touches the lives of all Zimbabweans,” Myers said.
“Our business continues to support the growing demand for digital services in line with global trends in the telecommunications sector, leveraging on cloud adoption and artificial intelligence whilst keeping our customers safe online with cybersecurity solutions.”
