Why Econet and Trustco Mobile fell out

   

Econet Wireless ZimbabweToday, the reasons behind the Econet and Trustco fallout have started to come out. Econet chairman Tawanda Nyambirai says Econet approached Trustco with complaints of breach of the contract between the two companies. Trustco apparently then threatened to terminate the agreement believing it could use its technical leverage to have its way.  But its bluff didn’t succeed. Called to proceed with the termination, Trustco backtracked on the threat. Econet though had its mind made up and basically said No thanks.

Here’s a summary of the reasons that Econet says amounted to breach of contract:

  • The widely disliked 31111 messages that infuriated Econet subscribes so much a Facebook protest group was created and within days it was followed by thousands of Zimbabweans.
  • Trustco demanded more fees for Ecolife subscribers and some additional fees for subscribers that only express an interest in registering for Ecolife. Trustco wanted the fees per subscriber to be upped from US$ 1 to US$ 1.11.
  • Trustco overstated the number of Ecolife subscribers when it announced its financial results some weeks ago. Trustco announced the number of Ecolife subscribers had reached 1.6 million. Econet says that correct number is 1.2 million.
  • Trustco disclosed to the press some information which the two companies had agreed was confidential.

As we have written here before, Zimbabwe was the first deployment of the Trustco Mobile system outside Namibia. It was also Trustco’s largest deployment yet. Trustco itself hasn’t commented yet on the fallout.

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