Mobile Network Operators (MNOs) in Zimbabwe are facing imminent service disruptions due to failure of settling outstanding credits with their main telecoms suppliers, who have been maintaining and upgrading the infrastructure.
Just recently Econet’s services were down as customers could neither call nor text and also processing of transactions through its mobile phone-based money transfer Ecocash was non-functional. State owned telecoms operator TelOne, also owes foreign suppliers more than $20 million, a situation that is threatening its operations.
TelOne owes West Indian Ocean Cable Company, China-EximBank, TDM Mozambique and TCF. On the other hand, Econet is said to owe Chinese telecom conglomerates Huawei Technologies Co. Limited , ZTE Corporation and Swedish firm Ericsson.
Delays in paying these foreign firms have led to the current telecommunication infrastructure failing to handle increased voice and data on the Unstructured Supplementary Service Data platform, leading to the network disruptions witnessed since Monday.
Speaking to Newsday,Potraz Director General Dr Gift Machengete explained the reason why Econet had service disruptions on Monday.
“I am not going to beat about the bush on these issues because it was Econet that was affected, so that is very correct that they must have had an overload on their systems and things like that. The fact that they are failing to pay, especially Ericsson. Concerning ZTE and Huawei, I think, they are negotiating with them. They really have serious problems with Ericsson…” he said.
“. . . because Ericsson would want them (Econet) to pay… They are supposed to pay Ericsson and they have got a debt which they have failed to service and now Ericsson is growing cold feet in terms of coming to assist them in the network. They (Ericsson) now want some upfront payment or some big deposit to be made, but as you know our foreign currency situation is not good, so they have not been able to get that foreign currency.”
“Not only on Econet are there issues. We have problems with TelOne on their debt and again we have been approaching the RBZ (Reserve Bank of Zimbabwe) who has been assisting in the best manner possible,” Machengete added.
Potraz has since reached out to some of these suppliers so that they continue offering services regardless of what they are owed.
“We have been doing everything to make sure the sector remains afloat . . . We know our operators are having forex problems, which are affecting the network and that we are aware. All of them (telecommunication firms) have these challenges.”
According to industry sources, having foreign currency would allow local telecommunication companies to pay licensing fees in regards to using their network which are serviced by these foreign firms.
It would also help paying for maintenance and upgrades to what are known as ‘switches’ at base stations that help in the calling process and transmission between base stations as well as paying for international internet bandwidth.
Local telecom firms Econet, NetOne, Telecel, Africom, Powertel and TelOne depend on such services with need growing over time due to the growth in internet penetration, fixed voice traffic, mobile voice traffic, mobile internet data, and international incoming internet bandwidth.
Due to this rise, telecommunication infrastructure needs to be constantly maintained and upgraded to meet rising demand which requires forex.
Compounding the situation is the recent introduction of the 2019 Monetary Policy that legalised local currency into official tender forcing telecom companies to seek a review on tariffs.
The telecoms sector has since wrote to Potraz requesting an upward review of tariffs.
Machengete said they were currently considering those proposals and would need at least 14 days to look into the matter.