Speaking at the Mobile Money and Digital Payments Conference in Harare today ICT minister, Supa Mandiwanzira, said that Econet is wrong to assume their first mover position in investing in mobile money infrastructure means they can close out other players from sharing that infrastructure.
Mandiwanzira was responding to statements made earlier in the day by EcoCash Head, Natalie Jabangwe. The head of Zimbabwe’s largest mobile money services provider (EcoCash has 97% of the mobile money market) had said that at some point in the future, it would be inevitable to share infrastructure, but at the moment, because of the heavy investment they have made into the distribution network, they needed to enjoy first mover advantage.
“If government did not want EcoCash or Econet to be the largest we would have opened our gates for Safaricom to come and operate M-Pesa in this market. We could have allowed MTN to set up in this market and offer the services that Econet offers. And I can assure you they come with a huge pocket to dwarf any player in this market and they have been knocking on our doors. But we have kept them closed because we want to protect them [Econet].
Now it is wrong to assume that you have first mover advantage, and therefore you must close out other Zimbabweans from benefiting from a system which you have been licensed on.”
Mandiwanzira also said he was more concerned that startups innovating in the telecoms and fintech space than established players like Telecel and NetOne.
The Econet group as a whole has been under pressure these past several months to share telecoms infrastructure as well as their soft distribution infrastructure like their more than 26,000 EcoCash agents. The group’s attitude towards sharing so far has been that they have invested a lot of money in the infrastructure while the competition slept and that regulators should let them enjoy the fruits of their investment.
Government on the other hand has emphasized that they are happy for infrastructure to be shared on commercial terms, and that this would have reduced cost benefits for consumers.
It’s ofcourse not clear how sincere the minister is in claiming that MTN and Safaricom have been begging to be let into the Zimbabwean telecoms & financial services market, or at least how sincere it is that the only reason deals haven’t gone through with such continental players is that government is keen to protect Econet.
It’s not a secret how government itself made it difficult for Econet to exist and to the best of our knowledge, no one in government (it’s the same government) has ever acknowledged how misguided they were to fight a 5 year battle against Econet, only to have the same company become the country’s biggest tax payer a decade later.