The Zambia Information and Communications Technology Authority – ZICTA is expected to identify a replacement player as the 4th Mobile Network Operator – MNO for Zambia following the failure by UZI to commence its operations.
Communications Minister Mutotwe Kafwaya disclosed to the Zambian Business Times – ZBT on June 11, 2020, that the decision to direct ZICTA to come up with an alternative willing player comes after UZI formally wrote to the Authority that they would not be entering the market following the expiry of their license.
The Minister said UZI had in May 2020 requested for further extension for a period of 120 days which was rejected by ZICTA adding that this is after the network provider kept pushing forward the date to launch its network and the last timeline given to them was end of May 2020.
Kafwaya has since assured Zambians that government remains open and committed to ensuring that there is enough competition in the telecommunication sector in particular and ICT sector in general. “It remains government’s policy to enhance competition in the ICT sector for the benefit of the Zambian people”, he told ZBT.
“It is in this regard that ZICTA will go back to the market to find another player and government will support the process to enhance competition and promote improved quality of services as well as lower the tariff for the benefit of the Zambian consumers,” He added.
In 2017, Cabinet approved a new licensing framework for the ICT sector which was aimed at promoting competition in the sector. Following Cabinet’s approval, the Ministry of Transport and Communications through ZICTA issued new licensing guidelines and invited proposals which culminated into issuance of a notification of wards to UZI Zambia in March 2018.
UZI was then requested to commence operation by March 2019, but in February 2019, the company requested ZICTA for an extension of the commencement date which was granted to them up-to November 2019.
The company again requested for further extensions in November 2019 on grounds that it preferred to roll out 5G as opposed to 4G for which the spectrum was allocated. ZICTA granted UZI’s request up to end of May 2020 on condition that UZI submits monthly progress reports to ZICTA to include the implementation date, update on contracts with vendors and updates of acquisition of equipment.
Then finally in May 2020, it became clear that despite the last and final extension given, as well as the challenges that the parent company UNITEL had gone through, UZI had failed to meet the obligations and the milestones set by the Authority. Their last ditch request for a further extension of 120 days in May 2020 was then rejected and their license has since been cancelled.
Zambia currently has only three mobile network operators that include a local unit of India’s Bharti Airtel, South Africa’s MTN and state owned Zamtel. The telco market in Zambia is largely a two horse race which analyst have said leads to lower levels of competition and makes its imperative for ZICTA to allow in more players.
To further enhance competition, ZICTA has been urged to introduce number porting were subscribers can switch to another network without the need to have their personal phone number changed, a service that is common in other markets.
As it stands now, MNOs are able to ‘lock in’ customers using phone numbers as switching requires customers to acquire a completely different phone number which acts as an artificial barrier. This has also led to some customers carrying two to three handsets at great inconvenience.
As for Zamtel, there has been calls to list the State owned MNO on the Lusaka Securities Exchange – LuSE to infuse a market orientation, enhance financial reporting and corporate governance as the company has struggled to post profits in a lucrative telco market, were its peers (Airtel and MTN) post back to back profits.
