Yesterday, we posted an article titled “POTRAZ to introduce compulsory infrastructure sharing in new regulations” which basically talked about the Zimbabwe’s telecoms regulator’s move to institute legislation to enforce sharing on telecoms infrastructure among telecoms licensees on commercial grounds. It’s not clear yet how commercially reasonable these grounds are going to need to be but we will all find out soon enough.
We get tons of interesting comments to most articles and this one is one of those. Sometimes those are so long and full of opinion, we decide to post it as a guest article of sorts. This one is penned by one Prosper Chikomo. Feel free to add in your opinion on the matter in the comments section.
Let’s say you are about 30 years old and you want to start a mobile telecoms business and the government takes you to court, and you face imprisonment if the court rules against you. Three years go by. Then you win the case, and a government official goes public saying “he will be broke within 6 months”
Then Big Brother disbands the Posts and Telecommunications Corporation and creates a number of entities from it, Netone (mobile telecoms), Comone (internet), Telone (fixed line), and finally, creates Potraz (Postal &Telecommunications Regulatory Authority.)
Potraz will regulate the industry.
By the time you set up your first base station, Netone,and Telecel, run by faces connected-to Big Brother are leading mobile networks.
Netone becomes the biggest mobile network with 20 000 subscribers, reaching every part of the country riding on the NRZ (National Railways of Zimbabwe) signalling system network (as the word on the street goes).
You create jobs with you small network, pay taxes, and iver the next 14 years, bring in close to US$1 billion in foreign investment building base stations and importing network equipment etc. You even go into debt to do this, using yopur own assets as collateral, which you wouldn’t have done if Netone and Telecel and even NRZ shared their infrastructure with you.
By 2008, you run the biggest mobile network, and Netone and Telone are not playing second and third fiddle.
Big Brother still runs Potraz.
By 2012, you control 70% of the mobile telecoms market.
Potraz says mobile networks must share infrastructure.
What is the moral of that story?
Well, that’s what happens in communism.
Zimbabwe, supposedly, is a free market economy and not a planned economy like in China – which itself is moving towards a free-market system -, yet now Potraz is doing the role of “economic planning” and the “allocation of resources” -PRIVATELY-OWNED RESOURCES, on behalf of the government.
This is sure gonna be something foreign investors will watch and learn from.
It is also nationalization by the back door.
You can’t say Econet has built the infrastructure, at a heavy cost, then force Econet to share infrastructure with Netone and Telone, entities with clear links to Big Brother.(basically, forcing Econet to share infrastructure with the PTC, in a different name.)
Potraz is destroying competition, now and in the future
Instead of investing in their own infrastructure, these mobile networks will relax because Potraz will do something about sharing. It is robbing Econet shareholders to give to PTC (Netone and Telecel shareholders).
Potraz is also the killing of thousands of potential jobs in Zimbabwe, at a time when the country enjoys 90% unemployment.
If Telecel and Netone invest in their own infrastructure, there will be jobs created, thousands of jobs, Zimbabwean jobs!
Telecel is “hugely” foreign-owned while Econet is distinctively Zimbabwean.
Forcing Econet to share infrastructure therefore amounts to subsidizing a foreign company with blood, sweat, and tears of Zimbabweans – Econet shareholders and workers. This clearly contradits the INDIGENIZATION that is being touted by the Government of National Unity.
There is also the issue of security.
Perhaps this is the best way to enforce the “Interception of Communications” Bill.
How can Econet guarantee its network and equipment will not be tampered with? How can Econet customers even feel safe?
If Netone gets investment from MTN, China, Libya, Britain or whoever, it can build its own infrastructure and create thousands of jobs opportunities in the process.
Potraz must learn regulation from Gideon Gono and let failing networks surrender their licences just like indigenous banks Genesis and royal did. If they are failing, let them fail, not rob Econet to subsidize “connected” incompetent businesses.
What Potraz is doing is clearly unfair competition. If they wanted infrastructure sharing they should have enforces it when Econet was the smallest network.
Each man for himself.
Lastly, netone has been printing adverts claiming it set up environmentally friendly base stations is Harare (is it Newlands) by attaching network antennae a to palm tree.
Why the heck can’t they just attach their antennae to trees everywhere and bee a very very green mobile network?
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51 comments
If, you are not Prosper, Guest Author…I think you should credit him for at least using his comments.
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Otherwise, it is progressive. Until we see how they propose these infrastructure-sharing regulations will be implemented, it is rather too premature to be protesting.
I imagine there will be a fair compensation of efforts & resource on infrastructure built.
Remember that, whilst Econet is leading the band, there are some like Africom/PowerTel that have their own infrastructure and may feel the same towards NetOne/Telecel (or whichever way round). So no need for bias favouring Econet only. I am also confident Econet will battle out any unfair arrangement, so no need to worry.
Besides all that we do not know yet what infrastructure if it is specific. Base Stations? Fibre? At what ratios? At which locations?
Lets wait and hear. Then we voice. Otherwise, just barking at the wind.
Again for all we know, the process may also have been consultative. Perhaps Econet have full disclosure on the issues and they were all ironed out and given thumbs up. Unless one is in the top echelons of the respective entities or has inside info on their reaction. Rest assured, there will be reactions. Receiving or rejecting.
Guest Author just means it wasn’t written by TZ staff. The second paragraph does mention who the author of this article is.
Got it
It’s interesting to see that Prosper Chikomo is undoubtedly the face of the techzim website his insights seem to be unchallenged by the moderators , which makes one wonder if techzim isnt just a mouth peice of bitter econet wireless zimbabwe, to preach propaganda of the marvels of their business, it’s sad that over the last week the site has put econet as the epitome of technology and that not a single zimbabwean would be disinterested in any of the companies products.
My only question is this if econet switched off it’s entire network would zimbabwe come to a stand still?… I certainly dont think so
With 70% grip on voice and an increasing hold on data, Zimbabwe would come to a standstill literally. May not close shop but the costs of such a scenario are not worth it! Perhaps it depends on the nature of the business you’re running
Well now they see the light.I suggested this some years ago.JUst drive between Byo and Hre and see 4 trenches of fibre running parallel.
I cal those trenches & fibre cables – “job-creating “back-up systems””. If one of those fibre cables fails, Zimbabwe will have other options.
There used to be a time when the whole of Zimbabwe relied on the Mazowe Earth Station and Telone, until Econet came along. When Telone (PTC) was down, the whole country was down.
Technology markets are very volatile. Just a few years ago Netone was the leader of the pack, now it playing second or third. It means nothing that Econet has a 70% grip on the voice market. If every Zimbabwean who currently has a sim card, was to have a sim card of the other two networks, Econet’s market share would be reduced to 33,33%.
Secondly, sharing a tower is not like sharing billing systems etc. netone and telecel must construct their own infrastructure just as Econet did. Zimbabwe will not come to a standstill. We cant punish success just to give competitors some help. If Telecel and Netone construct ther own towers, Zol, Africom, Brodacom and others will have plenty of options and the ability to shop around for less costly towers. Other services will come up that will ride on the infrastructure of the big 3.
And if Econet fails or goes down, people can always switch to Netone and Telecel, and even Telone.
The scenario that Telecel and Netone get off their bums and build their infrastructure is worth it.
We can’t punish success just to please uncompetitive and inefficient firms.
Plus when the mobile networks build their own infrastructure, they create jobs,. Zimbabwean jobs.
Prosper has an opinion that he decided to share in detail. We think it is more an article than a comment hence this article. it also portrays an angle we hadn’t considered but that is interesting nonetheless.
If you have an opinion to share with our readers, you are free to write it and we will make it available to our readers on the site.
We think that Econet launching the merchant service on EcoCash is a great deal deserving a lot of coverage in one week (more is coming by the way) and that Infrastructure sharing does have deep ramifications for the tech industry and access in general. if you think this coverage is too much, I guess we just have a different opinion.
Point taken, I’m not a person of too many words but it’s just outrageous that the site has econet banners, alongside articles promoting it’s products as well as sympathizing with it over potraz, please tone it down if you dont mind me asking how much of techzim has credit to econet or it’s affiliates?
Techonlogy in Zim is bigger than one company it many not be in every household or run most business but it’s insulting to assume econet will always be a means to an end
This sounds like some Americans who hate Microsoft for their dominance (though waning) in operating system software. If Econet pay for the banners and Techzim make the money therefrom, should we encourage Techzim to close shop?
I have no problem with Techzim at all but every other article has something to do with econet it’s not right, content creation shouldnt be about a single brand, you are right I hate the dominance that econet has especialy if you look at their billing system, I would have thought that being the largest networker would be something worth boasting about, but as it seem they would love to be remain biggest airtime vendor in the country,
True and that must change
…..I certainly think there would be chaos…which is no further than standstill.
My dear Prosper Chikomo telecommunication signals are a National Resource like Daimonds and Gold. And like Daimonds and Gold they are finite. None should have monopoly over these resources no-matter how much money or brains they may have. There is no benefit in erecting base stations alongside each other it’s wasteful and ridiculous.
Econet is a publicly traded company which raised its capital (to build their impressive network) through selling shares to the public and also makes money from the same Zimbabwean public who buy their services. Therefore they should submit to be governed by institutions that represent the same stakeholder. I am sure by no vadzora mari yavo yese yavakanyudza muvhu!
We all know the results of anything that becomes enforced. Zvakafanana nekuti iwewe uri kudya nemusone woti kushamwari yako ine nyama yehuku huya tisanganise tigodya pamwe! If your friend has not suggested it himself/herself then its clear kuti uri kuda kubatirira mumwe! After all pamaidya netsuro yenyu yamainge mabata musango thats the time I was busy keeping huku dzangu. What do you think Zimbabweans?
Sesithsilo mfo. Ukuthi lo, ngumqondo olungileyo ozosiza abathengi bamaservice abo. Abadala bathi izandla ziyagezana. Vumani inguqulo. Zincenda thina ama consumer. Njengabanye, ngilethemba lokuthi akula ophuma ebanjwe inkunzi
Science is daily discovering physical laws that can be harnessed to
achieve the hitherto fictional, e.g. quantum entanglement phenomenon.
Those physical laws go beyond the confinement of earthly physical
barriers. Pre-occupation with omni-regulations without stakeholder
consultation is tantamount to inhibiting innovation and rewarding
success with forced benevolence. There’s no virtue in begrudging
Econet’s success by legislating for them to share infrastructure with
competitors who erstwhile refused to do so with them when they felt it
would disadvantage them. I would like to think that there will be fair
compensation for the infrastructure already put up or if indeed the
regulators deem the base-station national resources, then they should
simply nationalise them, pay compensation and transfer ownership.
first of all the biggest beneficiary of infrastructure sharing will be telecel not Netone as the author is suggesting.I beg to differ that econet has the widest coverage but rather it has more base stations in the urban areas like 4 base stations in kuwadzana and this is in line with the number of subscribers they have.However outside the urban areas Netone rules mostly because it rides on all telone exchanges, nrz ,gmb and zesa infrastructure.Netone does not face hurdles from local authorities in acquiring land for infrastructure set up because all local authority laws are relaxed.Its not as if netone is begging econet to share towers coz where econet gets approval in a year netone can do it in less than 2 months so hapana ari kunanzva mumwe apa econet can actually benefit from netone also.Just take a look at econet coverage map & netone’s & you will see who has the edge.Lastly NETONE has not raised alarm over the issue & i remember last year the managing director setting the record that they did not resist sharing but rather had a problem with operators who wanted to use their towers whilst providing nothing in return.
You said it all bra
Then put regulator, Potraz, another parastatal in the picture.
Does that look like fair competition to you?
I respect Strive Masiyiwa for going through all he did to establish Econet. It’s very rare to find entrepreneurs with values that they’ll stick to like glue for so long. With this said perhaps the time has come for us to start treating Econet Wireless and every other operator objectively. The past must not be used to justify present developments. Econet for example should not be let to get away with misdemeanour because of “what happened”. Telecel should not be victimised because of “what happened”. Netone on the other hand has a “what happened” and a “continues to happen” in addition. Its own CEO was on record recently in the Sunday Mail stating that they have defaulters in gov that haven’t paid a single bill for years, this is understandable.
Lets learn to treat issues objectively and not personalise them. If we don’t then they’ll never be any progress.
true to dat bra
Couldnt agree more
I agree with you Clint. Hatingarambe tichiti, something happened in the past, tikadaro hatichafambe mberi. Mistakes were made, Sh*t happened yes, but we need to move on, and make sure that those mistakes are not replicated in the future.
Thanx Clint for the objectivity and I would add that putting aside personal difference aside first will go a long way in ensuring that there is a thriving competitive business environment and in the long run the customers will benefit.
i dont think i follow, are you saying Econet’s infrastucture should be shared or not? i get a feeling yekuti mazvambarara pamubvunzo. my take is, the author has clearly stated some of the reasons why they should not ‘nationalise’ econet’s infrastructure. and chief among them was simply because it is econet’s infrastructure, period. i get a feeling yekuti the whole grabbing mentality in the nation is still rampant. its no secret kuti econet has the best infrastructure, and only now, when everything seems in place for econet do these guys come in. i believe we should stand up against such, we know what happens when the government’s hand gets involved, PTC,POSB,Air Zimbabwe,Zisco Steel… the list is endless. well nyaya yangu is simply, let econet run their company, no interference from anyone should be entertained.
I have been following this story for a while even when it was still a rumor. If it was anyone else I would say no way, you cannot pay for someone else ride if they can’t afford it, but I’m sorry Econet deserve what their getting, that’s what happenes when you think of yourself and your pocket, someone else with a bigger boot will come up and kick you in the A*%&. Econet don’t be mad it’s called KARMA
@ guest ..I’m sure I have seen network articles being put up on TZ ,”dollar a day” promo from netone,rebranding and cheap data bundles from telecel .I think if you dispice something just the mare color or rhym of it puts you off.keep naming it as it comes TZ.
The whole point of infrastructure sharing is to enable competition and reduce duplication.
Regulations change all the time all over the world and if they are to increase consumer choice and driving innovation, then it’s okay. The USA did it in 1996, the biggest “free market” . Sorry if you have sympathies for a specific operator, but he truth is the consumer wins and that’s good for me.
Letting incumbents and entrants into the market share infrastructure helps them focus on their core business, i.e. offering telecoms services.
And for your allusion that Zimbabwe is a communist state, leaves a bad taste in my mouth.
Please can you expand this statement ” yet now Potraz is doing the role of “economic planning” and the “allocation of resources” -PRIVATELY-OWNED RESOURCES, on behalf of the government.” I don’t get what
PRIVATELY-OWNED RESOURCES, you mean?
I guess it depends on how you look at it. Looking from a consumer’s point of view, i love it since it means faster expansion of all networks, and that means more choice for me.
Networks of national unity? (I like). Sharing is good if all are able to bring to the table what is required and if they have a shared vision. If the right ingredients are not there, its disaster all the way. Just like pooling a van and a gonyeti in a transport business. The basis of doing something must not be because someone has done it, but rather, if it will work in your own peculiar circumstance. The first part of the article paints the line of events and ask the question “is it feasible, is it fair, will it work”. Dont forget the perception (imagined or real) built over time about the role and intention of Biggie (big Brother)
Not all will be able to bring equal things to the tabllebecause the Incubentss are already too big. Hence the need for them to share. Maybe licensing fees can be introduced, to make things fair. Big Brother isn’t always going to be Biggie. Let’s make necessary strides now
Their pace of development is different, product portfolio also different, management skills and vision different………….so are we not likely to see (if sharing is implemented) antagonism as to the direction of infrastructure development (its pace, technologies wanted). Who will manage the infrastructure, is it all of them, are they going to have another company to do it. Is this going to lead to efficiency as envisaged or is it going to increase costs, bureaucracy and slowdown in infrastructure development. How will the change affect existing shareholders in terms of their return on equity, borrowings (debt) repayment plans and costs (may lead to company rating downgrades – etc). We need to distill whether this is a corporate decision or nationalistic – will it be voluntary or forced, all these questions cannot be satisfactorily be answered until we get all information. It will also be interesting to find how such proposals are being received by the operators themselves.
We also need to know what are the modalities of this sharing, will all the infrastructure pooled and sold to another company???? those in the know can help by explaining more
When Bill Clinton de-regulated the internet, Netscape, Cisco, Yahoo, Amazon etc all came to the party. Companies in different fields rose up. Cisco networked the internet while Netscape made internet access easy and understandable, and many services worth billions of dollars went on to be built on top of that de-regulation.
De-regulation is exactly what is needed.
Instead of just targeting the current mobile 3, Potraz must licence tower construction/investment companies, de-regulate the market, rather than put more regulation on top of more regulation.
If Potraz feels there is a need to share infrastructure, it must use the Universal Services Fund, which is contributed to by the mobile 3 as a percentage of sales, to build the towers, or even approve the location for tower construction and the tower companies fill in that “shared infrastructure gap”. That would create jobs, and serve the mobile 3 and other players to come. It will also create jobs, not avoid or destroy them by consolidating infrastructure under the guise of “infrastructure sharing”.
Right now you can’t just build a tower to rent out to mobile networks.
It’s economics. Econet,is a private company that was started by private investors, and is not a government-owned company, same way your laptop is yours. In a free-market system, demand and supply are the means resources are allocated. By virtue of being a private company, econet is a private resource, and when Potraz says it must share its infrastructure, what it means is that Potraz is now performing the role of demand and supply, meaning Potraz is not leaving infrastructure sharing to be determined by the market (demand and supply -mobile 3 negotiating among themselves).
Okay Prosper in your opinion who should be the regulator?The same Potraz is the one which gave econet spectrum for 3g ahead of netone.
If telcos want to share infrastructure leave it to them to come to agreements amongst themselves as private businesses normally do. Forcing infrastructure sharing is the sort of brainless idea we have come to expect from Potraz. Sounds like Potraz has nothing substantive to do in comparison to what Econet and Telecel are achieving. If Potraz is looking for something substantive to contribute to the country’s economy, they should look no further than the holes plaguing our country’s roads. Now there’s an initiative worth undertaking!
POTRAZ should construct the base stations which can be shared esp in rural and non profitable areas using the monies they levy operators. In the current POTRAZ proposal they should explain the following:
(1) who is proposing this, is it government through POTRAZ, is it the operators, is it consumers (2) How is existing infrastructure brought into the equation, considering that they don’t have the same capital infrastructure in terms of quantity, quality (different suppliers of equipment), different appetite to provide services – others have electricity back up (3) Who will maintain the shared infrastructure – considering the moral hazard due to information asymmetric (especially where some networks cannot even pay interconnection fees) (4) what is the impact of sharing infrastructure against the status quo in terms of future investment and product portfolio growth and innovation. In civilized societies, policy or bill impact studies before such potentially destructive actions are undertaken to assess the impact of ideas (have done some).
I think it is important for Biggie not to get jealous and demand a free ride to Zion. Private shareholders have invested their monies (and this is not good news at all). If sharing is beneficial as intimated by the POTRAZ dude, private economic actors are the best to initiate the sharing process in the pursuit of profit (this is the normal way) than a third party (who has no penny invested and wont feel the loss if things go awry). This can be through bilateral agreements between operators.
This forced concoction of remedial medicine may actually turn up to be a poison in the well.
Just thinking Aloud
Sharing infrastructure is not new. Perhaps its only getting ephasised now. All the telecoms operators know about it. It appears in their licences so they new it for more than 10 years since Potraz was formed and gave them those licenses. The whole idea of sharing infrastructure form a nationalistic point of view (Which Potraz operates from) is to ensure that national resources are not wasted by duplicating facilities that could easily be shared. If one Telecom operator has already got a base station in one area there is no need for the 2nd operator to erect another one near by, rather the 2nd operator gets into a commercial agreement (pays rent) with the 1st Operator and then the 2nd operator uses those resources to build a base station in another location where there is no base station. Who knows perhaps the 1st operator will come and rent from the 2nd operators new base station. All Potraz has to ensure is that nobody charges inhibitive rentals
Lol. Why get all huffy about it? Econet knows its game. Dont you think you would look silly when it turns out Econet is in for it too? They stand to profit from it too
Ehh, in 2008/9 i happened to be watching (Face the Nation). Douglas Mboweni (CEO, Econet) was asked what his company was doing about covering the rural areas. He cited forex constraints but he said the networks can share a tower and install long range boosters that will cover a wider. That certainly would increase coverage in the rural areas. This was 2008/9, years go. Unless things have changed, econet is willing to share.
Infrastructure sharing is already happening, at least between Econet and Telecel. This is happening in a free-market, not through regulation. Netone is the one that seems (based on reports) to have/had/has (a history of) issues with sharing infrastructure.
Econet has already grown big enough that it really does not need Netone. That is now a fact of competition.
More towers = more opportunities for other, and new players.
I would never look silly. The mobile networks must create jobs, and not operate like one company with Potraz acting as the board of directors. Every tower that is raised, and every cable that is laid down creates jobs for Zimbabweans, Zimbabwean jobs.
Potraz must simply licence other companies that want to go into the tower business. Already Transmedia, which was spun off from ZBC rents out its masts to all 3 mobile networks, and that’s according to parliamentary proceedings of 7 June 2012. I could go on and on but I dont have time.
It would actually be very very silly if Netone was (very soon after sharing is enforced, or later) to be acquired by MTN (for example) and still ride on Econet’s infrastructure, which would amount to subsidizing a foreign company to compete against Zimbabwean companies. No, i will not look silly.
How I made you contradict yourself. In stark contrast to your sentiment. No problem. I cover my behind alot too.
Let me tell you something you dont know, but which i will not go further with because i do not want to waste my time arguing over useless things. I could go on and on, but i dont want to keep writing about the same subject. it’s time to move on.
You did not make me contradict myself. Long before you even posted a comment here, i did post exactly the same thing, in a comment, days ago and perhaps because it had a link it was moderated or deleted. Don’t give yourself a lot of credit.
Telling you what Econet is doing or has done, does not mean i am covering my back.
Just because i say econet is willing to share doesn’t mean i approve of sharing or that I am contradicting myself.
Again, if you ask me, Econet must not share even a needle with Netone or anybody, period! And I am against Potraz putting in place regulations that force Econet to share its infrastructure.
For your own benefit, ZTV sells past programmes. You can approach them and tell them you want to buy a copy of Face the Nation where they interviewed Douglas Mboweni. They have it and will sell it to you, very cheap. That is a historical fact, there is no back i am covering. Don’t give yourself a lot of non-existent credit.
Hahaha. No need to buy the programme. Sentiment changes. Even Econet/Mboweni. Afterall, we will hear how it turns out. We do not have full details on this proposed regulation.
Econet’s infrastructure is not the only infrastructure.
We cannot even preempt Econets reaction. I doubt you are its spokesperson. Though you are entitled to opinion, it is a waste of time and energy getting all huffy.
The details will come out. We will discuss. Econet will react and so will we. “Mandikurumidze akabara mandinonoke”
Maybe for Econet/Mboweni sentiment changes but not for me. And yes I am not their spokesperson just as any Microsoft or Apple or Obama supporter. Econet long reacted last month
but at the end of the day, Potraz will enforce its COMPULSORY regulation no matter what. The details of the infrastructure sharing regulation are already there in public domain. Why share infrastructure with companies that owe you US$85 million, and have no means to pay for infrastructure rentals? Do you think econet would give thumbs up to an arrangement where it is compulsory for Econet to share infrastructure with such bad debtors?
If Potraz announces something on infrastructure “sharing”, maybe it would be a changed or improved policy because of stakeholder reaction that is already happening, like right here.
Even Econet and Telecel have already reacted. I can’t go deep into it in a comment, but if you do a little research you will find out what I mean.
I do not mean to be offensive, but honestly i now feel tired being on the same subject. So this will definitely be my last and final response.
And so you contradict yourself
http://www.bgr.com/2012/08/16/sms-market-analysis-revenue-whatsapp/
Hahaha, I like this guy.
Without knowing the game plan that POTRAZ have in mind concerning the method of sharing resources, but I think if it is to be done then it should be done on a fair basis. The mobile operator who wants to use another operator’s already established infrastructure should pay something in the form of rentals i.e. if econet wants to use telecel’s resources then it should pay a reasonable fee to telecel and vice vesa is also true and set offs are welcome.
[…] This “sharing is caring” approach is hardly new. It’s what has been adopted globally in several markets. Locally the sharing discussion has been at the centre of talks on lower voice and data tariffs. POTRAZ has been handling dialogue between the operators and the State over this matter for years now. […]