Econet owes it to government to share EcoCash agent network, says Supa Mandiwanzira (full speech)

Below is the full response by Zimbabwe ICT minister Supa Mandiwanzira to statements made by EcoCash Head, Natalie Jabangwe-Morris, who had said that the Econet group needs first to recoup its investment in its EcoCash distribution network, before allowing other players to share its infrastructure.

The reason why EcoCash is the biggest is because of Econet which is the biggest mobile network in this country, and it is the biggest because it was licensed by government. it is one of the biggest payers of taxes to Mr. Chinamasa. It is the biggest tax payer because they make the money. They make the money because they were licensed by government.

They do so because government protects them to maintain that position. If government did not want EcoCash or Econet to be the largest we would have opened our gates for Safaricom to come and operate Safaricom in this market. We could have allowed MTN to set up in this market and offer the services that Econet offers.

And I can assure you they come with a huge pocket to dwarf any player in this market and they have been knocking on our doors. But we have kept them closed because we want to protect them.

Now it is wrong to assume that you have first mover advantage, and therefore you must close out other Zimbabweans from benefiting from a system which you have been licensed on. The government is spending resources defending you to ensure competition doesn’t come and grab your market.

It is important to understand that when you are leading in the market you also have to be responsible. Because you’re leading not because you are the smartest but because the environment which we have offered allows you.

If we had given this license to someone else we would have probably been much better, or far better than what you are doing.

Zimbabweans have a tendency to think that they are smarter than everyone else and that everybody is a fool. And that government doesn;’t understand that the reason they are successful is because of them – the government.

So today I want to make it clear that Econet, EcoCash are very successful, thanks to the government of Zimbabwe because we protect them.

But when we say we have a crisis and we need to open up doors to allow other Zimbabweans to utilize the infrastructure you have built because you were at the right place at the right time. And you are operating on a finite resource, which is a frequency and we cannot create many frequencies to allow other players to come on board. Open up the infrastructure, allows us to share.

When EcoCash, Telecash and OneWallet came to the ministry and said, we recognise that the government has the biggest infrastructure in terms of post offices, more than 230 across the country. We would like to operate our mobile money services through these post offices. We didn’t say “Oh, we spent a lot of money, we need to recover it, allow Zimpost to do it first before you do it.”

We opened up the postal network so that EcoCash could be as big as it is today. So it’s not wrong for government to expect Econet to share its infrastructure as well with other operators.

And when we say share with other operators, there’s a tendency to believe that we want to protect NetOne. I want to make this very clear. I don’t support people who are incompetant. I don’t support mediocrity. if they cannot compete with EcoCash that’s it! let’s find other people who are good to run NetOne to be able to do that.

But we want this opportunity not for those that are already in the market, we want young men and women who are coming up with brilliant value added services to sit on your infrastructure for a fee.

Now if someone else brings a SupaCash instead of an EcoCash, you must be allowed to use the infrastructure of EcoCash. It must be another revenue centre for EcoCash that we’re now also sitting on their platform. We can’t block everybody.

We’re saying it’s an advantage to have a license. You were there when the licenses were being given. There are Zimbabweans who are smarter today who deserve those licenses but they no longer have the opportunity. Allow your infrastructure to help others who want to get into business. Not Telecash, not OneWallet because they must build their own systems.

But what about these Zimbabweans who have brilliant ideas and want to sit on that infrastructure. Who can no longer get a frequency that you obtained via the license. If you have built infrastructure, allow others to use that infrastructure.

One of the things I avoided mentioning in my speech is the cost of mobile money services. And I’m sure Natalie you have heard a lot of complaints that EcoCash is very expensive. This is a market reaction.

We believe that EcoCash can reduce its costs if it allows other new players, old players to share its agency network. And I know one of the reasons why you are expensive is that you incentivise the agents, you give them a higher percentage of these transactions they do. But if they are now being used by 3 or 4 other players, you are able to reduce your own commissions to them, because they are recovering those costs from other players and therefore your cost to the consumer is reduced.

We cannot create an impression of a monopoly, and I’m not suggesting that’s what you’re doing, or a monopoly where “because I built this infrastructure, it’s me, I must make money. no banks can come on board. No other networks can come on board. I’m the only one, I’m the smartest.”

No, nobody is smarter than anybody. And especially if you’re given an opportunity that comes with a license.

But if you’re creative and yo come up with your own software, it doesn’t require a license, so you can claim to be smart. But if you’re given a license by the authority. This license comes within a limited field of licenses that can be issued, I think it’s reasonable for government to expect that there’s sharing of that infrastructure.

And we don’t expect people to ride on that infrastructure for free. They must pay for the use of that infrastructure, so when we talk about infrastructure sharing within the mobile money systems. We’re talking more in terms of allowing other players – creating more opportunities for new investors to come on board.
I think you had Natalie presenting here and she emphasised one of the biggest advantage that we have for this NFC to be adopted rapidly is that we have a mobile penetration of more than 105% in this country. It’s a result of government investment and private sector investment. So when a player in this sector goes to Europe to raise money, those statistics have a value in money that you raise. So government has invested. it can’t be an individual company that has made this investment – it is all Zimbabweans.

When I buy this cellphone for $700, I have added value to your network not necessarily because I’m using your network but because I’m not a statistic that you can use to raise money. Similarly government has invested in telecommunications infrastructure which allows for mobile money to now take place, clearly it must be recognised that it has done something and therefore when we are considering our business strategy we must not look at what government requests as trying to undermine other businesses. in fact we like the success that Econet and EcoCash have done. They have put Zimbabwe on the map.

Ofcourse we sing about M-pesa, but this is a remarkable story. Given our population and the time it has taken to develop EcoCash it’s a phenomenal story and it must be used as an example.