Here is why Econet “doesn’t want to share”

Posted by

In business, sharing isn’t just about caring. There have to be fair benefits for everyone contributing to a communal pot. That’s the long and short version of what Econet has really been saying about Infrastructure Sharing.

The Minister of ICT, Supa Mandiwanzira, had strong words for Econet and it turns out the match that started this whole fire was the statement released by the mobile network yesterday.

So what exactly was Econet on about? What did the mobile network operator do or say that earned them an extortionist tag in the Minister’s books?

In one loaded statement, Econet has questioned the Universal Service Fund, remarked on other operators’ commitment to operators’ licences and fiscal responsibility and sent a message to the government that Econet plays a very big role in Zimbabwean communications.

You can read the statement sent out by Econet below.

advertisement

With the arguments being laid out by Econet, do you think it is justified to speak out against the infrastructure sharing arrangement the Government is proposing?

THE PRESS STATEMENT FROM ECONET WIRELESS REGARDING INFRASTRUCTURE SHARING

Econet Wireless has noted the ongoing public debate over infrastructure sharing in the
telecommunications industry. Our view is that the current debate does not relate to infrastructure sharing as we understand it. Our understanding of infrastructure sharing entails parties who have invested in infrastructure in different geographic areas entering into arrangements to share their respective infrastructure on an equitable and reciprocal basis to avoid infrastructure duplication.

This is the approach to infrastructure sharing that we support and continue to take part in.

In our view, it is unfair to compel sharing of infrastructure where one party does not have the
infrastructure that the other needs. That is tantamount to compulsory acquisition of infrastructure from one operator who has chosen to invest in infrastructure, for the benefit of another that chose to invest in other assets that are either not available for sharing, or that we do not need.

Econet is the youngest mobile operator, having entered the market when others already had a head start. We had to raise funding through various channels, including the Zimbabwe Stock Exchange, to develop our own network to the level where we now hold approximately 80% of the telecommunications infrastructure in the market.

Econet is an indigenous company with a large shareholder base that includes most pensioners through the National Social Security Authority, Old Mutual and many other pension funds. Our share register has thousands of shareholders who all made painful sacrifices to invest in this infrastructure.

The tone that the current debate on infrastructure sharing has taken appears aimed at compelling Econet Wireless to make its infrastructure available for the use of others who chose other investment priorities. We would be betraying the Government of Zimbabwe and thousands of pensioners and other shareholders who chose to forgo dividends in order for us to develop our infrastructure. Therefore, the type of infrastructure sharing under debate is not feasible. It is a disguised, unconstitutional form of compulsory acquisition of our infrastructure.

We are confident that the Government will see through this ploy as they have already spoken out about the uneven playing field where only Econet has paid a license fee of $137.5 million and our competitors have not. We also doubt that they make compulsory contributions to the Universal Services Fund set up in terms of the Telecommunications Act. We doubt that they pay the full tax. We doubt that they pay the annual license fees. However, we are confident that the Government will now look into all these issues and even the playing field.

66 Comments

  1. Anonymous says:

    Econet has a valid point.

    1. Magneto says:

      Econet does not have a valid point at all. We cannot perpetuate this insanity where you 3 base stations on top of 1 mountain. What Econet should be doing is looking to the future and investing their in finding an infrastructure sharing model that will work for everyone. We cannot continue to retain such an uncompetitive business model as it will be an albatross around the neck of our Telecoms industry and our citizenry ultimately.
      My 2 cents…which unfortunately cannot but an MB of Econet data

      1. Econet not saying infrastructure sharing is a bad thing at all. They’d love it to save on capex. Problem is the new compulsory sharing being proposed is not on a negotiated commercial basis, which is already happening by the way.

        1. Castro says:

          One day this government will ask them to share subscribers!!!!!!!!!!!!

        2. Magneto says:

          There are also many models Zimbabwe MNOs and Fixed Network Operators can adopt in-terms of Infrastructure sharing. Namely – Basic Site Sharing, Network Sharing, Spectrum Sharing, MVNOs, National Roaming and establishing Tower Companies. The models range from loosley tied (Sharing passive network components e.g. Towers, Shelters, ZESA etc..) to more heavily involved models (sharing active network components such as Base Stations and Microwave Radios etc…)

          Whatever model one chooses the benefits of sharing world-over are too glaring for any Telco to ignore. Lets take here in Zimbabwe – establishing just 1 Base Station(Tower) site can cost as much as $400 000. Now if Telecel and Econet for example need to deploy say 1000 Base Stations in the next 3 years and they decide to share it means they will each save $200million over the 3-yrs which they can put towards innovation and Product Development and Executive posh cars!!!! Not to mention the Economies of Scale and other multiplier effects down the line.

          Econet need to forgive and forget for the sake of our industry moving forward.

      2. Kungurirai says:

        Sharing means all have assets to do the sharing (bring and share yebraai). When one has something and the other does not, its not sharing, its called giving away or donating. Why was sharing not discussed when netone had a big rural footprint than econet. They boasted about it and didnt want to share. Lets think about the future, will this sharing arrangement promote investment (netone and telecel have not even paid their licenses, would you want to mess with such players who do not comply with license regulation). If you join such guys, they wont even think of capex and as econet you will be screwed. Another issue is how do you account to your shareholders who are highly leveraged during investing into assets when others (telecel nd netone shareholders) were busy squandering their profits. If this sharing is alowed, then we will regress to the Nehanda age when no new investment is made and shared infratsructure go derelict. Can you build a house and someone say they want to come and share it with you because we will waste resources in building more houses. Those who want to share should be free to do so. (okey, huuuuuu, end of rant)

      3. Samsung Galaxy says:

        Please comment in proper English. Are you angry on behalf of the minister?

        1. Jetsetter says:

          We are not English, its a 2nd language,

      4. maita says:

        I was of the opinion Econet was becoming a bully but they have pertinent questions which needs to be answered by the authorities. They are right I think. These other companies are run by thugs.

      5. Tawanda Mhuriro says:

        Read properly before you comment improperly.

    2. Anonymous says:

      Econet has a solid legal standing. We wish them the best.

  2. Lazzy says:

    Sharing is very important in the long term and the Government should force it if Econet keeps on resisting. People who are in support of Econet are not thinking wide. Researches have indicated that sharing of infrastructure in any means benefit both the company, consumers and the Government itself including enviroment mgt, lower tariffs, quality equipment, high revenue inflows and so many ways which I cannot mention here all

    1. Clement says:

      While the idea of Infrastructure is a noble and logical thing to do, it has however come very late. It is the government who are to blame for this mess as they ignored recommendations made years ago on this issue.
      Infrastucture sharing must be negotiated at this point rather than imposed. It is hard not to see this as government going after a company doing well in order to shore up their struggling baby. Econet has a point there considering they are the youngest of the MNOs and stand to lose the most while by their investments will now promote their very challengers. You mention price issues, its strange that you would blame Econet for overcharging us and leave out POTRAZ who are the regulators of the sector. Who is sleeping on the wheel. Government through POTRAZ have the mandate and right to intervene where players are short changing or taking advantage of citizens, they continue to fail at this as in other areas where the have set up regulatory authorities.

      We have long complained to POTRAZ on spanning, cost of data, SIM cards at one point and per minute instead of per second billing and asked for mobile number portability. POTRAZ have acted slowly if at all and we have had the feeling they are unwilling to touch the cash cows, remember ECONET has paid $187 million to the fiscus.

      If anything POTRAZ have been complicit to our being overcharged, spammed and short changed, they are to blame in the first instance and Econet naturally would take advantage!

      Sorry but you have aimed your guns at the wrong target and as Zimbos we are aware of the ineptitude of POTRAZ in regulating this industry and that is the heart of the issue. This move by the ICT ministry has nothing to do with lowering prices but tackling and reducing the hegemony of Econet Wireless by bringing its competitors to competitive levels, in case you haven’t noticed Econet is really the only viable MNO. Telecel has no licence and Netone needs urgent surgery , hence this move.

      1. Anonymous says:

        Government as usual is 2 decades behind everybody else. Econet paid for the infrastructure so it belongs to them. Anything other than that is theft.

    2. Anonymous says:

      How do you share when Econet has 80% of the infrastructure in the market. As stated above they invested in this infrastructure whilst some were investing in other things that are not worth sharing. Government has to create a level playing field.

      1. Lazzy says:

        Sharing dosn’t mean that another operator will be using 80% of Econet infrastructure for free whilst other operators are enjoying their vehicles and buildings as per. For one operate to ride over another operator’s network, you pay and this already being practised which is what is called leasing of equipment. So there is no loss to Econet by sharing its infrastructure because the company will be still earning revenue from its wide investment. The benefit to the consumers will be low tariffs. My big question is why Econet is refusing to share its vast infrastructure after the Government is now regularising it, yet it is already riding on other Gvt property such as TelOne, ZETDC, and moreso our land in Zimbabwe.

        1. Ini says:

          My question to you is have seen the infrastructure sharing proposal which Econet is sharing? Is it reasonable? Doe it consider the cost of the investment made and interests on borrowed funds?

        2. Cde Techno says:

          hahaha what land?, econet is a zimbabwean company, these guys also have the right to their country. These guys have invested a lot in the industry and you guys zvamajaira you just want to wake-up rich, you lazy pigs!

    3. This is not about infrastructure sharing at all. The argument is about wealth transfer, a concept Zimbos are very good a resorting to when they fail to build something of their own.

      1. angiecentra says:

        For once im on the side of Econet, they are punishing their success here!

      2. Mhunga says:

        Government has not yet articulated a framework for infrastructure sharing so I’m really at a loss as to how you’re arriving this seemingly authoritative position that this has nothing to do with infrastructure sharing but is an attempt at wealth redistribution. Your claims are not factual.

        Supa correctly observes that it is absurd that someone can roam on MTN while a local subscriber cannot enjoy the same privilege. Roaming is a form of infrastructure sharing. Until government actually sets out its proposed framework one cannot argue against the general concept which we all accept is noble.

        Instead of writing provocative press statements, Econet should play an active role in lobbying the authorities for an equitable framework that rewards those who invested. Up till now Econet has not bothered to engage the authorities.

        1. Boris says:

          Asi you are part of the authorities, you seem to know a lot? If we truly have democracy in this country, then govt should those who want to share do it on their own and leave Econet to go it their own way.

        2. keepyours says:

          CellC in SA roams on Telkom and i think MTN as well where they dont have coverage and that is not complusory it is an agreement that they have with other players, Telone was laying fiber when i was in high school during the digital migration thing and they stopped. No one stopped them they had the capacity to be what Liquid is today had they invested well but instead they sat on their laurels (laughing), now they want to indiginise the telecoms market please grow a pair. If we look at SA there are a lot of companies doing infrustrure sharing but this is the choice we want to make, force everyone to join your game just coz we play at your house.

        3. Tapiwa✔ says:

          Econet is lobbying and engaging the authorities (as well the public) – through the press. Why do you think they sent out a PR?

      3. Anonymous says:

        Econet have done nothing wrong, they have provided a service that 80% or more of Zimbabweans have willingly paid for. Same goes for Innscor, National Foods, Delta and 1000’s of others. Netone, Telecel and the Government were fast asllep. You snooze you lose …..

  3. Great arguement. You can’t be forced to share. You must be compelled to do so.

  4. Castro says:

    I dont know why people seem to hate Econet. the guys invested a lot for them to be where they are right now. Why would they share their infrastructure when they wont benefit in any way?

  5. Ini says:

    A few days ago diamond companies where being forced to merge into one. Watch this space. Very soon you will regret supporting Cde Minister when he takes over all MNOs and run them dry.

  6. Anonymous says:

    can the minister start by merging three companies; Telone, Netone and Powertel into one company Zimcom, Zimnet watever they will call it.
    Powertel will become the carrier and focus on enteprise business, telone will focus on fixed networks and netone being the mobile network operator

    1. Anonymous says:

      Well said.. thats a merger that makes sense

    2. Lazzy says:

      Watch the space and you will enjoy the benefits of merging TelOne, NetOne and Powertel to name a few.

    3. tinm@n says:

      Powertel is already a ZESA subsidiary and was primarily for signals carriage in the grid. They still serve that purpose, with current internet services built upon the same infrastructure.

      Merging wont solve a thing. It will, infact compound it.

  7. SoTypMe says:

    Ironic. Econet used to clamour for sharing back when NetOne had the widest coverage, as well as on NRZ equipment. The suggestions were shot down because…well…Econet. Now its big, and evryone suddenly realises its a great idea?
    Put an offer that Econet finds lucrative, get into negotiations with it. Dont force the issue: its a private company for Pete’s sakes!

    1. keepyours says:

      nice one, they had the upper hand and they through it away now they cry foul. Like they say in football, they were grabbing defeat from the jaws of victory.

  8. Ed says:

    This is amazing.
    Economy and emotions should not be mixed. If this happens then surely Zimbabweans will be the ones to lose. Strive can continue on his global businesses. Government should learn to invest in its companies and not just seize what others built.

  9. tinm@n says:

    National Developmental Goals vs Privately owned & Commercially Advantageous Assets

    I greatly dislike Econet and its acts of greed and emphasis on profiteering, but once again I am forced to side with them.

    The property is theirs.

    They worked for the position they are in, and are reaping benefits from their sweat.

    Now to be told to share?

    Essentially, meaning distributing your market advantage amongst your competitors.

    They shouldnt be forced to do what they dont want to do with their property.

  10. Sipu says:

    To all intents and purposes, Econet is a monopoly. Monopolies are always bad for an economy. In the US, Standard Oil, owned by John Rockefeller was split up because of the company’s immense power. ATT was split up to form the ‘Baby Bells’. Econet has far too much power and is trying to control more and more aspects of the economy of Zimbabwe. Econet is bad for Zimbabwe. Its predatory behaviour and abuse of power stifles competition.

    1. Cde Techno says:

      Do you really know what you are saying. I thought the government was the monopoly here before Econet came in to the game, they even tried to stop it and now thy are playing victim. thy were busy sleeping whilst econet was striving and now they wanna reap where they never sowed. Econet have the right to their property and must not be forced to share if they don’t wanna share. Let them decide their own fate

      1. Kaiser says:

        Government were caught sleeping because who ever thought their purse, the tax payers, would run dry? NetOne/TelOne was and is really funded by the tax payer and not wise business enterprise. Techno, you quite rightly say, the then PTC was a monopoly, and from this advantage they enjoyed the 4? plus years head start they had on Econet with unlimited resources out of the tax payers piggy bank. Now the minister wants to talk economic sense – for Telone. Please note, I’m not an Econet fan. I like Timon dislike them BUT for once I do think Econet has a point.

        So why don’t government do what they have done in every other incident when they were caught sleeping, and implement an infrastructure development levy. After all the broke tax payers could surely extend themselves to that. Remember the Aids Levy, Rural electrification Levy, drought Levy.

      2. 2by2 says:

        Definition of a monopoly : A situation in which a single company or group owns all or nearly all of the market for a given type of product or service. It is characterized by an absence of competition, which often results in high prices and inferior products…

        When someone says Econet is a monopolly, all they mean is they are dominating the market to such an extend that consumers now get to be at a disadvantage due to high prices.

        So yes, slowly Econet is becoming a monopoly and if these Telecel struggles continue, and they close down, Econet will surely then be a monopoly.Only then, will people realize how dangerous that is.

      3. Sipu says:

        Hats off to Econet for what they have achieved. But they have become too powerful. Telecoms are like roads and railways; they are a form of communication that need to benefit the nation and not the individuals who own and run them. Imagine if the roads of this country were privatised. EcoRoads builds a 6 lane motorway from Beit Bridge to Harare, to Chirundu. It runs parallel to the existing road, but is built and maintained to first world standards. Good for EcoRoad, everybody would say. Of course, all the traffic would move on to that motorway. There would be less and less money to repair the existing government road which would eventually be abandoned. Now all the traffic is running on EcoRoads motorway. The toll fees would rise and rise because there is no decent competition. When a road connecting Mutare to Bulawayo, run by TeleRoad tries to cross and merge with the EcoRoad, the latter would refuse access. The country would be held hostage by EcoRoad, because all imports from South Africa would be delivered at a premium. Traffic going from Beira to Bulawayo would not be able to get there, because there would be no way of crossing the EcoRoad motorway. You might say, EcoRoad owns the motorway it can do what it likes, but that is not how things work in a civilized society.

        If Zimbabwe is to have working infrastructure that benefits the people and the economy, it needs to be regulated fairly for the benefit of the many, not the few. That is not happening with Econet. Econet is now in a position to destroy all competition. If is is allowed to continue like this it will charge whatever it wants and do whatever it wants and it will do it for the benefit of the shareholders, not the vast majority of Zimbabweans. Such power leads to corruption and destruction.

        1. Fairness says:

          Its not like Econet got where they are illegally. They got where they are through hardwork and extensive investment. Now you say they are too powerful! Is there a law or piece of legislation in Zimbabwe that prevents a company from ‘succeeding too much’?! Telecel or any other company is free to do what econet is doing. Provide quality service and you will lure more subscribers. Now that the the other companies couldn’t keep up with econet’s competition (not illegal ,by the way) you want to bring down econet in the name of ‘evening the playing field’?! Remember econet was not the first mobile operator in Zimbabwe. They worked for their success and they earned it. You should instead focus on ways to keep up with the competition. That would be good for our economy because competition drives innovation which in turn drives development.

    2. keepyours says:

      Instead of crying wolf and say share infrustrure say Econet unbundle the liquid, ZOL, econet mix and then talk sharing maybe that is a way forward if Econet does not turn and say to GVT you also unbundle the powertel,telone, netone and everything else and lets talk. don’t bring a knife to gun fight.

  11. Muti says:

    Ok it seems we have many noobs here. When you say sharing infrastructure reduces traffic, hiw exactly is that possible?
    Government should leave Econets internet infrastructure right now because I’m using it at the moment and you know when Government touches something ..it turns into brown sheet.
    Dear Government leave the only internet that is working for me please please I beg you.

  12. mad says:

    sharing naiko ? sharing ne MNO asina license ?

  13. macd chip says:

    Hunjwire, kuda kukohwa pavasina kurima ndozviripo chete apa.

    Kana Supa ari kuzviita samasimba wehurumende adii kunopuhwa mari yemutero Telecel yaisiri kubhadhara. Handiti kutya maWar Vets ari kuTelecel, woda kuzviita minister pakambani iri kubhadhara zvose zvamunotara.

    Ko hapana akaudzawo Supa kuti pane mari iripo pakuvaka infrastructure yekusheya here yakachengetwa nePotraz.

    Why force when there is funds being deducted for that. ls not this double dipping?

    Potraz ngaitiudze kuti mari iripi. Iye zvino base station kumusha kwedu rave ne6 years richingovakwa pasina chirikubuda.

    I smell PHD syndrome here. Kusada kuona wekwako achisimuka.

    Vakai Netone isvike pane Econet mozotaura zvekusheya izvi

  14. Chanda Piwa says:

    Potraz is supposed to construct base stations in remote low traffic areas for sharing by MNO’s. Elsewhere, MNO’S may choose to share by leasing excess capacity. MNO’S already voluntarily do in er network transfers for calls and texts, but at one time others were reneging on payment of fees due. This compulsory sharing is driven by ulterior motives of envy and greed! Look at the land invasion where on once thriving farms now only grow wild “sora” beans! Kana ku sa nyara!

    1. Anonymous says:

      that is already happenig under the USF project but word is Potraz has not yet done much

      1. Progressive says:

        how many base stations have they constructed??? it was once published last year that they had done 8 base stations since 2009 while the other 3 where not yet complete??? is that the pace of development that is needed in a fast changing environment like Telecoms??? Snail’s pace does not work in that industry.

  15. Jetsetter says:

    One thing I have noticed about you guys at Techzim is that you are very biased where econet is concerned. I support what the government is saying, Econet has been a bully for too long because they have the money. even media houses are scared to say anything bad about them as they are the major advertisers. enough is enough

    1. Tapiwa✔ says:

      If you have any illusions about a pro-Econet bias, read the recent series of stories on the “The Source” raid.

  16. Anonymous says:

    Imwe i boko haram!!

  17. papadee says:

    So its like gvt saying to TM and OK guys share shops???

  18. simon says:

    When ‘farm invasions’ commenced in 1999 I said to colleagues it would be indigenous black Zimbabweans next once there were no whites to invade. The principle matters. Next they’ll be saying share accommodation. If you have worked hard and purchased houses to pension yourself one lazy person will be told to occupy one of your residence. This is exactly what the sharing is about. It is about abusing what someone has meticulously worked to build. I remember us going for years without a dividend as Econet shareholder while the company was purchasing equipment. Now those who were putting their money in other things want to shre this equipment. It is not fair unless they are able to bring something compensatory for the sharing.

  19. aBota says:

    Takatora mapurazi tikagara muma farm house but iyezvino tazviparadza, tikatora minda yaive nechibage chava kuda kukohwewa,tikaparadza. Tikatora macompany akange achi producer tikaparadza, tikatora 51% but macompany acho apera kuvhara. Tava kuda kutora Telecel pachena tobva taenda pa econet totora pachena zvobva zvaparara. Ndozvatiri isu

  20. taona says:

    Supa is forgetting that as a private company, Econet shareholders sacrificed their money to invest in the company. Whatever Netone and Telecel did or did not do did not benefit the investors in Econet. Forced sharing will then be robbing Econet shareholders of their just return. Did we share what Telecel and Netone have . No!!! What Supa should be doing is getting the companies together and negotiate on the way forward as not to duplicate facilities. This should not be done at the expense of Econet shareholders who sacrificed there money and dividends in the past when the others where spending away their monies on bling and other useless luxuries.!!! Am not surprised with this Zim psyche, which is sadly now entrenched especially in politicians, where people want to reap where they did not sow!!!

  21. Tapiwa says:

    At such pace of ill advisory and baseless politicking the government will be forcing Chicken Inn and Chicken Slice to share outlets. Hahahahaha

    1. Nyati says:

      Best Illustration !!!

  22. Kevin says:

    Its all about wealth, now they want a piece of Econet. Build your own thing sha!

  23. kilio says:

    is econet help line functional or not I tried to call for help for several times but there was no respond

  24. shawn says:

    you guys are good. great debate and all.

  25. Anonymous says:

    What the govt can do is propose infrastructure sharing at a fee, there by increasing the coverage for all the people, or they (the benefiting service providers) could in return develop another area for econet, they should make the goal uplifting the whole community of zimbabwe

  26. BTM says:

    I do not subscribe to the notion that Econet is a monopoly i think it is rather misguided and is meant at attacking Econet as a company due to what i think is personal reasons.Subscribers still have an option to use other mobile service providers and thus the monopoly issue is really not sufficient.In as far as infrastructure sharing is concerned this is a noble idea and Econet based on the press statement i have read above did not say they are against the idea all they are saying is there should be fairness in how its done i quote “to share their respective infrastructure on an equitable and reciprocal basis to avoid infrastructure duplication “.We need to understand that 1.the other companies could have invested in infrastructure if they wanted to but they chose not to. 2.Could approach Econet and suggest a better way to share their infrastructure which obviously will involve financial negotiations as it is Econet property.
    We also need to ask ourselves these questions.
    1.Has there been any negotiations between the service providers(Econet,Telecel ,Telone etc.)
    2.Is there a bill/legislation to govern such operations
    3.What is the Minister’s understanding of infrastructure sharing and has he done enough consultations or as a newly appointed minister he feels he has an obligation to make his presence felt.
    At the end of the day we want better service and companies that contribute meaningfully to 1.the economy ,2.growth of ICT in ZIM and 3. improve people’s lives.

  27. rex says:

    Ngava sheye netone building first

  28. console says:

    My point of view. Ist—Let have a big basket of shared infrastructure. 2nd—Lets determine who among the players have the list number oranges(infrastructure) to put in the basket.if NetOne own 5 oranges,Telecel 9 oranges,Econet 17 oranges there for every 1 must submit 5 oranges to the basket. 3rd—Telecel can further share its remaining 4 oranges with Econet bt thic tym net1 will nt be n tht basket. 4th—the good news is net1 will be in control of thic game for th tym being .If Net 1 brings anothr orange to the basket of sharing thr4 evry is obliged 2 do the same same. NB—thic can only make sense to parties who have a genuine goal of sharing. hypocrites myt disagree wth me

Leave a Reply

Your email address will not be published.

css.php