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Enacy Mapakame
Mobile network operators revenue for the first quarter of 2020 jumped 26,2 percent to $2,1 billion from previous quarter’s $1,64 billion, subsequently enhancing overall sector revenue growth.
According to regulator, the Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ), costs for mobile network operators, however, grew by 46,1 percent to $1,4 billion from $988,2 million recorded in the previous quarter.
IAP revenues also grew by 49,6 percent to record $754,3 million against an 80 percent increase in operating costs to $749,4 million from $416,3 million in the previous quarter.
Also on the topside, fixed telephone revenue grew by 23,6 percent to record $308,9 million in the first quarter of 2020 from $250 million recorded in the fourth quarter of 2019.
Operating costs for this segment grew at a slower pace at 4,7 percent to $249,2 million from $228,5 million recorded in the previous quarter.
The increase in operating costs across segments have been driven by the increase in cost of goods and services as inflationary pressures persisted during the quarter under review.
The economy was also characterised by foreign currency shortages and dwindling disposable incomes, adding to the sector’s woes.
“The foreign currency challenges have affected network deployment and maintenance as spare parts, equipment and vendor support fees require foreign currency.
“Furthermore, the credit crunch also negatively affected network expansion. The high cost of International Internet Connectivity remains a challenge as Zimbabwe is a landlocked country, accessing bandwidth from undersea cables via Mozambique and South Africa,” said POTRAZ director Dr Gift Machengete in a sector performance report.
During the period under review, total fixed voice traffic declined by 6,9 percent to 112,1 million minutes from 120,35 million minutes.
Total mobile voice traffic also declined by 4,7 percent to record 1,33 billion minutes from 1,4 billion minutes as consumer preferences are now skewed towards over the top services that are relatively cheaper.
On the other hand, mobile internet and data traffic increased by 2,8 percent to 6 661TB. Dr Machengete indicated that internet and data traffic is expected to continue growing due to the increased adoption of e-learning, telecommuting and e-conferencing.
The market has adopted e-commerce in compliance with national lockdown and social distancing measures to help limit the spread of the Covid-19 pandemic.
“Data and internet services will continue to drive industry growth. The shift towards telecommunicating and e-learning will drive demand for data and accelerate the voice-data substitution.
“The social distancing measures introduced to avoid the risk of exposure and spreading Covid-19 will see an increased usage of ICTs as people avoid physical contact and resort to conducting business online.
“The use of Over-the-Top services, such as WhatsApp, Skype and Viber, is expected to grow in the current economic environment as consumers cut back on communication expenditure,” said Dr Machengete.
Online Reporter