Frehiwot Tameru, CEO of Ethio-telecom announced that the government is drafting a communication proclamation establishing a strong regulatory body to oversee the communication sector, including the Broadcast Authority. Frehiwot told journalists that the role of the existing regulatory body needed to change because soon other telecom companies would join the market alongside Ethiopia’s sole telecom provider. When that happens, she said, regulation issues would become more crucial.
“Establishing a strong regulatory body is an initial and fundamental step to transform communications,” she told Capital. “Ethio-telecom is participating as a single operator and as a significant role player. The structure of a strong regulatory body will bring about the change we need in the sector. We will transform telecom after we are done creating a fair playing field.”
Frehiwot stressed that the Telcom monopoly sees fair competition as an opportunity and to make this a reality the nation needs a strong and independent monitoring organ, which she thinks has not existed in the past.
The regulatory body will have strong arbitration power, knowledge, and budget to support the liberalization of the sector.
“The interconnection we mentioned in the tariff revision involves relationships with those based overseas, and when multiple operators come there should be pre-set rules to govern the issue,” Frehiwot explained further.
In her briefing Frehiwot stressed that tearing down Ethio-telecom completely would be a nightmare.
“We learned that some brokers are defaming the current status of the Telcom to depreciate the value of our company, but this will not occur under our leadership,” she said. “Ethio-telecom is every Ethiopian’s property and campaigns to damage telecom’s image are damaging our own country. I want to use this opportunity to tell those want to see this company fail that it will not happen under our watch.”
The Ministry of Finance is undertaking the entire liberalization and practical privatization process. After the communication proclamation is finished, the Telcom will be transformed according to the CEO.
Discount
Ethio-Telecom announced discounts of up to 40 percent on its 71 international voice destinations effective the end of November. The discounts were categorized into 13 zones. Discounts averaged around 20 percent for calls to South America, Europe, North America, and Oceania, Asia and the Middle East and 10 percent in Africa. Telecom cost is higher in Africa so the discount was lower.
The CEO of the Telecom said it took time to implement the discount because the Telcom had to negotiate with its foreign partners.
“We have worked with foreign operators to stop the rate of illegal calls,” said Frehiwot.
The telecom previously had two SMS zones one in Djibouti and the other with the rest of the world. Now, however, there is only one SMZ zone.
Simbox
The telecom traced more than 300 Simboxes, secure online inboxes for users of the Tor Network, which were being controlled by a small number of people and institutions.
“The popular presumption that there is only one Telcom operator In Ethiopia has been proven wrong by these Simbox holders who are providing international call service illegally,” she said. “The strategy we were using was wrong just to hunt them out rather than paralyzing them by creating a competitive business environment. Now we have mapped out their location and after clearing these businesses out, our fair price arrangement will discourage others from doing this.”
Ethio-Telecom has announced that in the past seven years the contribution of international calls to revenue ratio has decreased dramatically to 5 percent from 20 percent.
The Ministry of Revenue bears some responsibility for the increasing number of Simboxes because the devices mainly come via contraband, according to the CEO. She stressed that the existence of these devices is not only a threat to the telecom sector but also to national security.
The Telcom will keep taking corrective measures in this area in cooperation with other security organs, as they focus on developing a winning business model.
Structural reform
The Telcom has continued to undertake structural reform and is extending the same effort to the corporate structure by establishing the International Business Division. The division will be working to improve the quality and variety of international services. Also, it will play the main role in fighting illegal activities which are bleeding the Telecom’s foreign revenue, according to the CEO.
The Telcom focuses on the traditional international telecom transaction services and the newly established division, which is reporting to the CEO, will focus on introducing various services.
Payment and uncollected bills
The Telcom revealed that it has been receiving complaints about the unnecessary payments made, and it is investigating the companies. The CEO told journalists that it would return any excess money that was paid to the Telcom with a deep apology.
Bill payments have been exclusively made only in the Lehulu Payment Centers in Addis Ababa, following an administrative decision which forbids the Telcom Service Centers from doing so. The CEO announced that the decision has been suspended and its service centers will receive payments.
The Telcom has 800 million birr in uncollected funds and by revising the payment system it expects revenue to be assured. The enterprise is doing a study to trace the problem and figure out the reason that such amount of uncollected cash exists. Banks and online bill payments for postpaid services are also listed to collect to receive bills in the near future, according to the CEO.
Email, domain and hosting names have been completed within the past three months. The service will be available in January.
The transaction, new strategy and loan payment
The enterprise has been frozen from purchasing items for the past three years, according to the CEO.
There are expansion projects signed and operational in three areas of the country. Among the areas, one owned by Ericson was delayed because of controversy that erupted and with the change in the administration the problem is solved, according to Frehiwot.
“Ericson was planning to move out from Ethiopia leaving the South West Region pending, which goes from Adama, Nekemte, and Jimma. This was due in 2016,” she said.
The telecom was able to obtain USD 157 million in the past three months. The telecom paid over USD 100 million in debt. In the past fiscal year, the telecom has obtained USD 120 million.
Frehiwot said they want to focus an an incremental development strategy rather than revolutionary approaches.