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Ethiopia was one of the last countries in Africa to allow its national telecommunications company to have a monopoly on all telecommunications services, including fixed, mobile, Internet and data communications, Research & Markets reports.
For many years, Ethio Telecom’s monopoly control stifled innovation, restricted network expansion, and limited the scope of services offered. However, in June 2019, the government established a regulator and passed legislation to open the market to competition, providing much-needed foreign investment.
The process to partially privatize Ethio Telecom advanced in September 2019 when the company was audited, while two licenses are expected to be available to international operators by the end of the year. Safaricom and MTN have expressed interest in entering the market.
Despite the stimulus of market competition, in recent years there has been considerable investment in telecommunications services, infrastructure, and service expansion projects. Ethio Telecom has secured a network monitoring platform to help it improve services and has also reviewed plans to launch a telecommunications satellite, while the government began construction of a $ 3 billion tech city.
Most of the technologies implemented so far have been provided by ZTE and Huawei, which have often been preferred for offering vendor financing. In preparation for competition in the mobile market, Ethio Telecom has placed the expansion of LTE services as the cornerstone of its investment program for 2022.
After years of low absorption due to prohibitive prices, Ethio Telecom reduced rates by up to 50% in 2018, resulting in a sharp increase in voice and data traffic. Now that retail prices are comparable to other more developed markets in the region, prices will come under pressure starting in 2020 as the two new international operators launch services. This should be a catalyst for constant growth in all sectors in the coming years.
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