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Telecel to introduce LTE in 2016, downplays the service’s immediate relevance in Zim

   

Angeline Vere, the CEO of Telecel Zimbabwe

In Zimbabwe, we’ve had LTE, or rather, patches of it since 2013. Econet took the first plunge and started extolling the virtues of  the high-speed data communication standard back when most subscribers were still getting warmed up to the idea of mobile broadband.

Over the past month, that picture has changed dramatically. Econet finally enabled LTE for mobile phones and NetOne, the government’s own mobile network operator (MNO) has taken the lead with a more ambitious and well-funded rollout of LTE.

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But where’s Telecel in all this?

According to Angeline Vere, the MNO’s CEO, Telecel has been piloting LTE in parts of Zimbabwe and will be activating it in the first part of 2016.  This will likely impress Telecel Broadband subscribers that are keen on experiencing super fast mobile connectivity.

On why Telecel has taken time to respond to the moves being made by its competitors by activating LTE, even for limited number of areas, Vere pointed out that right now, the return on investment for LTE in Zimbabwe doesn’t warrant a huge rollout.

She highlighted constraints like the limited national smartphone penetration (it’s been hovering around 20% for a while) and the fact that LTE brings with it the added challenge of providing subscribers with LTE enabled devices which, for the greater part, haven’t been priced for emerging markets like Zimbabwe.

Vere’s concerns regarding LTE mirror those that have been raised by most observers whenever the Zimbabwean LTE conversation is brought up. This was never the case when Econet had a limited investment in LTE. The Econet strategy at the time made sense for anyone looking at the facts on the ground.

The fact that NetOne poured in a substantial amount of money into LTE might have changed the noise around this type of service, but it doesn’t answer a lot of questions about the establishment of LTE or its feasibility in Zimbabwe.

How will these LTE-enabled devices be introduced en masse to Zimbabwean subscribers?

How will any such ambitious device program dovetail with the government’s 25% duty on devices that was introduced last year?

How will any investment be recouped without any significant adjustment being made to the cost of mobile data, something that the struggling mobile operators will fight tooth and nail to prevent?

While all these issues might best be left to the market forces to decide the future of LTE, Telecel’s LTE plan for the immediate and long term is clear.

Vere has highlighted that right now they are working on consolidating 2G and 3G service for the existing and potential Telecel Broadband subscriber base. This means improving the 2G and 3G coverage and getting more users to access data services, even at a basic level.

There is also a device distribution strategy that is being explored which involves bulk device acquisition. If successful, it will rope in Vimpelcom, Telecel’s majority shareholder and one of the largest telecoms operators in the world and through this relationship, Telecel Zimbabwe will be tapping into the group’s purchasing scheme.

Other than that, it would seem that for now, LTE isn’t a huge deal for Telecel. The operator probably wants to amplify the user experience on its network without scrambling for the latest fad that doesn’t register with its subscribers.


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