As Starlink makes its grand entrance into Zimbabwe’s telecommunications arena, it’s easy to get caught up in the excitement. The promise of high-speed internet at seemingly affordable prices has many Zimbabweans cheering – and simultaneously casting stones at Econet, our homegrown telecom giant. But before we rush to judgement, let’s take a step back and examine the complex landscape that Econet has been navigating since its formation.
Having been in this space for years I’ve come to see a lot. Though I was still jumping durawalls bunking school at Churchill Boys High then Morgan High School we are all aware that Econet were not handed their operating licence on a silver platter. But some may argue that that was aeons ago and such shouldn’t affect their operations of the day. You may have seen the articles that I’ve rolled out recently on Starlink but this is an attempt at playing Devil’s Advocate and looking at things differently.
The Licensing Labyrinth: A $137 Million Hurdle
Let’s start with the elephant in the room – licensing fees. Econet didn’t just waltz into the Zimbabwean market; they had to pay a staggering US$137.5 million for a 20-year licence from POTRAZ. That’s not pocket change for anyone, folks. To put this into perspective, Starlink’s licensing fees in Zimbabwe are reported to be around US$575,000. That’s a difference of almost US$137 million! Yes you may argue that they are for different types of licences, one was for a mobile network, while the other is for an Internet Services Provider, but come on, let’s agree that everything has gone “internet based” now, and if it hasn’t, it soon will.
Now imagine trying to recoup that investment while still trying to keep your services affordable. It’s like trying to run a marathon with a boulder strapped to your back.
I remember chatting with an Econet executive a few years back about their infrastructure investments. He quipped, “We’re basically building roads in the sky, but instead of toll gates, we have to rely on data bundles.” That licensing fee isn’t just a one-time cost; it’s a weight that Econet carries with every decision they make I’m sure.
The Interconnection Conundrum: A Game of Financial Hot Potato
Now, let’s talk about interconnection fees. In an ideal world, telecom operators would seamlessly settle these fees amongst themselves, ensuring a smooth flow of communication across networks. But in Zimbabwe? It’s more like a game of financial hot potato.
Econet has often found itself holding the short end of the stick, with other operators either neglecting or failing to settle their interconnection debts. It’s like hosting a dinner party where half the guests eat their fill and then conveniently “forget” their wallets. Econet ends up footing the bill, which inevitably impacts their pricing strategy.
The ZiG Dilemma: A Currency Catch-22
Here’s where things get really sticky. While Starlink can happily charge in USD, Econet is not only forced to accept payment in ZiG but also at the official bank rate! If you haven’t been living under a rock in Zimbabwe you’d know that with the street rate often double the official rate, Econet finds itself in a currency quagmire.
Imagine you’re selling apples. You buy them for $1 each, but you’re forced to sell them for the equivalent of 50 cents. That’s essentially what Econet faces when trying to source USD to settle external invoices. It’s a financial tightrope walk that would make even the most seasoned acrobat nervous.
ZESA’s Disappearing Act: The Power Predicament
Ah, ZESA. Our old friend who loves to play hide and seek with the electricity. While Starlink’s satellites orbit blissfully above our power woes, Econet has to grapple with the harsh realities on the ground.
Picture this: You’re running a network that spans the entire country. Suddenly, the power goes out – not for an hour or two, but sometimes for up to 24 hours at a stretch. What do you do? You fire up generators to keep those base stations humming. But generators need fuel, and fuel costs money – lots of it.
I once visited an Econet base station during a particularly brutal bout of load shedding. The site manager, gesturing to the humming generator, said, “This beast drinks more diesel in a day than most cars do in a week.” It’s a necessary expense, but one that inevitably trickles down to the consumer.
The Foreign Currency Tango: A Dance of Desperation
Here’s another wrinkle in Econet’s operations that often goes unnoticed: the struggle to access foreign currency for critical imports. While Starlink can operate largely from afar, Econet needs to constantly import equipment, software licences, and expertise to keep its network up to date.
But accessing forex in Zimbabwe? That’s about as easy as finding a needle in a haystack – while blindfolded. The official channels are often dry, probably forcing companies like Econet to resort to the “alternative market”, where rates are significantly higher. This will not only increase their operational costs but also puts them in a precarious legal position.
I recall a conversation with an Econet supplier who lamented, “We’re caught between a rock and a hard place. We need to import to keep the network running, but the forex just isn’t there. It’s like trying to bake bread without flour.”
The Regulatory Tightrope: Walking a Fine Line
Let’s not forget the regulatory environment that Econet has to navigate. While Starlink enters the market with relatively few strings attached, Econet operates under intense scrutiny from various government bodies.
From POTRAZ’s quality of service requirements to the Reserve Bank’s currency regulations, Econet has to constantly adjust its operations to stay compliant. It’s like trying to play a game of chess where the rules change every few moves.
I’ve sat in on industry meetings where telecom executives grappled with new regulations. The frustration was palpable. One exec summed it up nicely: “We’re expected to provide world-class service with one hand tied behind our back and a blindfold on.”
The Infrastructure Investment: Building the Digital Backbone
Here’s something that often gets overlooked in these discussions: the sheer scale of infrastructure investment that Econet has made over the years. While Starlink can beam internet from space, Econet has had to physically build out a network across Zimbabwe’s varied terrain.
From remote rural areas to bustling urban centres, Econet has laid fibre, erected towers and maintained a vast network of base stations. This isn’t just a one-time cost; it requires constant maintenance and upgrades.
I’ve trekked to some of Econet’s more remote base stations, and let me tell you, getting equipment to these places is no small feat. It’s a testament to their commitment to connecting all of Zimbabwe, not just the easy-to-reach areas.
The Way Forward: A Balancing Act
So, where does this leave us? As Starlink enters the ring, it’s easy to cast Econet as the villain, the lumbering giant unwilling to change. But the reality is far more complex. Econet is fighting with one hand tied behind its back, facing challenges that Starlink simply doesn’t or won’t have to contend with.
Does this mean Econet is perfect? Far from it. There’s always room for improvement, and healthy competition from players like Starlink could be just the push needed to drive innovation and better pricing.
But as we embrace the new, let’s not forget the role that companies like Econet have played in building Zimbabwe’s digital infrastructure. They’ve been in the trenches, dealing with our unique challenges, for years.
The entry of Starlink is exciting, no doubt. But rather than pitting one against the other, perhaps we should be asking how both can coexist and complement each other. How can we create a regulatory environment that fosters fair competition while acknowledging the investments made by existing players?
As Zimbabwe steps into this new era of connectivity, it’s crucial that we approach it with nuance and understanding. The telecom landscape is complex, and simplistic comparisons do no one any favours.
So the next time you’re tempted to bash Econet (or any local telecom provider) in favour of Starlink, remember – they’re not just competing on speed and price. They’re navigating a complex web of local challenges that no satellite can beam away.
The future of Zimbabwe’s internet is bright, but it’s going to take more than just new players to realise its full potential. It’s going to take a collaborative effort from providers, regulators, and users alike. And who knows? Maybe this new competition will be the catalyst for positive change across the board.
In the meantime, I’ll be here, watching this space closely and keeping you updated on every twist and turn in Zimbabwe’s evolving digital landscape. Because in this fast-paced world of tech, the only constant is change – and I wouldn’t have it any other way.
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For those still struggling with buying Starlink due to capacity problems, knowing which bank card to use or just general payment challenges, transferring a kit to Zimbabwe, selecting the right hardware for their needs, installation, accessories, troubleshooting Starlink and other such issues… a local ICT company, Safari Mounts, is helping Zimbabweans navigate Starlink problems with some hand holding. They can be contacted via this Google form and are charging a nominal fee to help. Techzim benefits a referral fee when they help you.
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