• Tue. Jul 16th, 2024

Econet lion’s share of Internet and data traffic down 2.1%

ByEconomic Times

Apr 12, 2023

By ETimes

Zimbabwe’s mobile Internet and data traffic increased by 3.4% to 33,576.4 terabytes in the fourth quarter of 2022 from 32,473.1 terabytes consumed in the third quarter of 2022, with Econet getting the lion’s share ahead of its competitors, latest report shows.

The Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ) shows that throughout the year, mobile Internet and data traffic has been increasing despite the challenging macroeconomic conditions.

“Overall Internet and data traffic has been consistently growing over the course of the year, in spite of depressed demand across other markets,” POTRAZ said.

“Internet and data has also been relatively price inelastic; illustrating its growing importance as a basic commodity.”

In terms of market share of internet and data traffic, the country’s telecom giant, Econet, saw its market share decline to 74.5% in Q4 2022 from 76.6% in Q3 2022.

This can be attributed to the network challenges being experienced across its network due to power cuts.

Of late, the company has been on a renewable energy push to ensure that there is power on all its base stations so as to improve network quality.

On the other hand, a meaningful increase was recorded by the state-controlled mobile operator NetOne, which saw its market share rise to 25.3% in Q4 2022 from 23.2% in Q3 2022.

Telecel, which is facing financial difficulties and network problems, saw its market share remain flat at 0.2% during the period under review.

“Econet continued to dominate the market share for internet and data traffic (74.5%), owing to their huge active mobile subscriber base as well as their wide network coverage,” reads the report.

“However, in the quarter under review, Econet lost market share by a margin of 2.1%. Conversely, NetOne gained market share by 2.1% whilst Telecel maintained their position.”

In the period, mobile operator revenue rose 50.2% to $119.48 billion from $79.53 billion in Q3 2022.

As expected, due to inflationary pressures in the market, operating costs surged to $81.73 billion from $48.57 billion.

“Aggregate operating costs grew by 68.3%, a margin that surpasses growth in aggregate revenue by 18.1%. This is an indication that costs continued to close in on operator revenue which diminishes operator profits,” it said.

The industry regulator said the mobile operators were not spared from the effects of economic headwinds.

“Mobile network operating costs continued on an uptrend, as staff costs, bandwidth costs and depreciation continued to be the main cost drivers for mobile operators. The increased load shedding in the quarter under review also increased power costs.”

Operators relied on fuel for generators to power base stations, even for those supported by solar, as the length of loadshedding exceeded that which could be sufficiently sustained exclusively by solar power,” POTRAZ stated.

Capital expenditure was up 494.4% at $12.76 billion.

“Capital expenditure grew significantly; the bulk of the capital expenditure was in national switching.” – Harare


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