Econet’s 2022 Annual report. Beyond 5G and profits

The 2022 Econet Wireless Zimbabwe Annual Report is out. All 125 pages of it and they have been busy. There are some areas they touched on that caught my attention and need highlighting.

Taxes

It’s no secret the industry is heavily taxed. And it makes it very hard for players to break even let alone post profits especially when 28% of the revenue is going to just taxes alone before any other expenses and overheads are deducted.

The system (TTMS) attracts an additional tax of US 6 cents per minute on international incoming traffic, payable in foreign currency. This increases the taxes that are levied on the telecommunications sector, specifically. The industry is currently subject to 10% excise duties on revenue. This is over and above the 14.5% VAT as well as other regulatory levies and taxes of 3.5%, bringing the total taxes on each dollar of revenue to approximately to 28%

Dr J. Myers CHAIRMAN OF THE BOARD – Econet 2022 Annual report

4G, Devices, Base stations

An interesting statistic Econet released was that 1.2 million devices on their network are 4G capable. This translates to about 12.9% of the devices on their network being 4G capable and also gives an idea of just how 4G is a technology a majority still don’t have access to mostly because of the cost of purchasing a 4G capable device.

Additionally, the device strategy also increased the 4G devices on the Econet network by 46% to close the year at 1.2 million 4G capable devices.

Econet 2022 Annual report

However, a 46% jump in just one year is massive. Primarily due to the technology becoming more affordable with brands like Itel having 4G capable smartphones costing less than US$100. Also, add the fact that the tech is now also attainable for gray smartphone manufacturers the entry fee to 4G can drop by a further US$50.

Data consumption increased by an impressive 48% to the tune of 4200 terabytes a month on the Econet network mostly owing to their network coverage. They also added a good number of base stations with 22 5G sites across the country at the time of writing this article as well as 120 new 4G sites.

Green energy

216 Econet base stations are currently running on solar and the energy savings they have accumulated in the past financial year have been 1.57 million kWhr. A rough calculation puts the savings at ZW$1.1 billion just from switching to solar.

These installations were done by DPA, one of the Econet subsidiaries and up to date their solar installations have a capacity of 4025MW. Just for comparison, Zimbabwe is generating 1271MW so the capacity DPA has installed all over Africa thus far is over 3X more than what Zimbabwe can produce.

Also read:

• Does Econet’s 1130% profit increase even mean anything? Benefiting from relatively low tariffs?
• Econet voice, data and SMS bundles going up, now it’s 43 minutes for the price of a loaf of bread
• The Econet 5G router is going for half a million dollars. Yes, you read that right