Safaricom eyes data as Ethiopia revenue driver

Safaricom-Ethiopia Chief Executive Mr Anwar Soussa. PHOTO | POOL

Safaricom has formally launched operations in Ethiopia, signing up 200,000 subscribers in weeks as the telco moves into the capital Addis Ababa following a pilot test in 10 regional cities.

Safaricom Ethiopia’s 2G, 3G and 4G mobile services are available in 11 cities, including the capital and the country’s second largest city Dire Dawa.

The Safaricom Ethiopia consortium, which also includes Vodacom Group, Sumitomo Corporation and British International Investment (formerly CDC Group), plans to launch services in a total of 25 cities by April 2023 to meet the 25 percent population coverage required under its licence.

The telco said yesterday it plans to leverage on data packages to edge into Ethio Telecom’s market share and will deploy machine learning to curate personalised offers.

The company says it is pursuing a mobile money licence that will allow it to do peer-to-peer cash transfer, business payments and extend credit to individuals.

“We hit the 200,000 milestone two days ago and that was just a few towns. Our initial customers want data and that is why we are using that as our competitive angle. We have learned a lot from the pilot and as we move towards Addis Ababa we are comfortable with the system integration,” Safaricom Telecommunications Ethiopia chief executive Anwar Soussa said.

On August 29, the firm carried out the first network pilot in Dire Dawa City and followed up with the second test in Harari Region in eastern Ethiopia from September 1. The third pilot began on September 7 in Oromia Region, starting in Haramaya City.

Safaricom is launching a greenfield operation in Ethiopia partly supported by a deal with Ethio Telecom to share towers and fibre infrastructure.

Safaricom has been planning the Ethiopia launch for over a year but has been slowed down by delays in signing infrastructure sharing deal with Ethio Telecom and slow pace of setting up their own towers due to Covid-19 supply chain dislocations.

Network sharing is a strategic solution for new entrants into a market dominated by an incumbent operator or in mature developed markets.

Parties have to agree on charges, load-bearing capacity of towers, space within sites, tilt and height of the antenna and adverse effects on quality of service (QoS) when antennas are combined and differing standards employed by the equipment vendor.

The company says it has hired 650 employees for the new operations, comprising 200 expatriates and 450 local workers, including 50 fresh graduates.

The consortium has spent more than $850 million (Sh102.6 billion) on acquiring the Ethiopian license and $300 million (Sh36.2 billion) as capital expenditure this year.

It has pledged to spend more than Sh300 million annually over the next three years to meet network coverage targets under the Ethiopian licence.

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