Last month, when Econet Wireless chief executive, Douglas Mboweni, appeared before a parliamentary committee on Media, Information and Communication Technology on ICT, he reportedly disclosed that Econet is owed a whopping US $85 million by NetOne and TelOne in interconnection fees.
Last week when Econet decided to terminate interconnection with NetOne it cited $20.4 million as the figure outstanding from NetOne in interconnection fees excluding interest. This effectively leaves an amount at least 3 times are much, owed to Econet interconnection fees by the two state owned telcos. Ostensibly, this would be about the amount TelOne, the country’s sole fixed line operator, owes Econet.
A source at Econet has confirmed that TelOne does owe more. Much more. We are also told that it’s not just NetOne and TelOne that owe Econet interconnection monies. Without naming the other telecoms firms, the source said they are owed money by more and that them being owed such payments was nothing out of the ordinary. It is NetOne’s attitude towards the debt that Econet had found surprising and deserving the rapid escalation of events leading to the disconnection. Specifically, the sudden denial by the state owned mobile operator that they had no agreement with the company, and therefore “no obligations due to Econet with regards to interconnection fees”.
TelOne, according to our source, has been honouring its interconnection fees obligations to Econet in terms making arrangements to clear the debt and paying something. The source says that even though the payments from TelOne come in trickles, the state owned fixed line company had not “repudiated” the interconnection agreement with Econet.
NetOne itself has suggested the interconnection termination has more to do with hitting the company when it hurts the most; during one of the country’s biggest business exhibitions, the Harare Agricultural Show, and that it may be more an act economic sabotage than just an ordinary business decision.
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9 comments
Netone needs professional help.
Since when is it illegal to suspend services to debtors for the same service for which amounts are outstanding?
Econet is dealing with these 2 state enterprises for non-payment. And since state enterprises are known to do as they please, Econet can kiss their $85 million bye-bye. It’s gone for good! That’s doing business with state enterprises in Zim.
TelOne…NetOne’s mismanaged sibling.
At the onset of dollarisation. Given that every company was struggling to get on its feet, what did TelOne do? It went on a disconnection frenzy. Some person high in TelOne’s office decided that this would be the best way to make people pay. That by some miracle, people who were also recovering from the effects of a bad economy could magically have money to settle bills of over $500
Same thing done by NetOne and its former contract-line partner(was it Zelco?). Disconnecting and serving people with summons. (ZESA too)
So they successfully aided the cellular telepphone companies by teaching people to no longer rely on them for communication. Killed the golden goose and shot themselves in the foot. Something called strategy must be very foreign to them
People came to them to negotiate payment plans. What did they do? Shoved their heads in sand and didnt want to listen. So then, many peoples phones are relics of some past. A thankful reminder of TelOnes kind justice of pushing them away from fixed line usage. How dumb is that?
So all in all, these conjoined twins owe a combined $105m and they wish it all away. Econet must put Netone on “prepaid”.
My sentiments exactly!!!
This totally makes sense…even in our everyday lives. Lets say you owe Zesa $1000 and your neigbour owes $50 yet they don’t pay or make an effort to conract zesa, they will be disconnected, however, if you make a payment plan with them to show them your commitment to the debt, even $30 a month, they wont cut you off. So I hope people wont paint Telone as the bad guy as they are making some sort of efforts to pay off a debt that clearly spiralled out of control due to bad management, the advent of mobile technology and last but not least, rebelious customers.
I remember buying econet airtime for double the face value during the time dollarisation occured naturally I thought best to use a landline as I didnt need money up front unlike recharging, yes I’ll admit I part of the reason Telone owes such amounts of money to econet.
Not only did I watch the phone get disconneted, I disregard the nominal rental of just $5 that accumilates each month, and have never attempted to settle, how then does Telone recover with thousands of individuals who did the same.
Trust ZANU PF run institutions at your own peril. Can you imagine if Netone was the sole Cellular provider (as they once attempted to do), where would we be today. We wld still not have 3G & mobile internet. We still suffer from having ZESA as sole authority.
[…] that Econet cleverly negotiated with the government to offset monies owed by TelOne and NetOne (in interconnection fees) against the new US $137.5 million mobile licenses fees. As a result, Econet only paid $50 million […]