Econet disconnects Telecel

HARARE - Zimbabwe's largest mobile phone operator Econet Wireless Zimbabwe (Econet) has barred Telecel Zimbabwe (Telecel) from its network because the latter is yet to renew its operating licence.

This means that Telecel subscribers may not make voice calls to Econet users, even though the latter may make calls on the Telecel platform.

“Econet Wireless does not have any legal or moral obligation to interconnect with an unlicensed operator,” Econet said in a statement.

“In fact, we have a duty to disconnect such an operator.  Econet Wireless has fully met the terms of its new licence, which terms include hugely burdensome financial obligations.”

Econet was in May awarded a renewed 20-year licence following the expiry of the 15-year licence issued in 1998 after paying $85 million as part of the $137,5 million new licencing fees set by the ministry of Communications.

Econet, the biggest mobile phone operator by subscriber numbers and market capitalisation said that in contrast, Telecel has not been subjected to any such financial obligations.

Telecel is yet to obtain licensing because it is yet to comply with indigenisation laws which compels the firm to cede 51 percent shareholding to locals. Currently, Telecel is 60 percent owned by the Egytian unit of Orascom.

This development comes after Telecel had lodged a complaint on Tuesday to Post and Telecommunications Authority of Zimbabwe (Potraz) that Econet was hindering connectivity between the two operators.

“With no such burden upon it, Telecel has been free to deliberately engage in trading practices that have distorted the playing field,” the Econet statement said.

The ZSE-listed telecommunications company said: “Clause 5.2.2 of our licence requires us to interconnect only with licensed operators. 

“This paragraph derives from Section 61 of the Act, which allows a licensed operator to interconnect with another licensed operator.  Section 2 of the Act defines a licensee as a holder of a valid licence issued in terms of section 37 of the Act.”

Econet said there was no obligation to interconnect with a provider of telecommunications services that was not validly licensed in terms of Section 37 of the Act.

Econet pointed out that in the circumstances, it regrets to advise that they are obliged to disconnect Telecel from its network.

Comments (14)

telecel lacks professionalism....

KARTER KOTO - 26 July 2013

IN YOUR FACE

evans lovedale murombo - 26 July 2013

Let maTelecel subscribers phone between themselves and stop congesting our network. Telecel must first pay the $140m so the ground becomes level.Ungati matomatoes emaOK aiite same price nemunhu anotengesera papavement asingabhadhari tax?Im Econet for life.

Mupfana weBikini - 26 July 2013

Air Tel there is the chance to invest in Zimbabawe like Pokello asked you to do so if you snooze you lose Zimbabwe is waiting for you to invest in the country please as you can notice these funny shinnaningas going on over 2million disadvantaged here yes politics at play but Telecel professionalism also lacking i do understand one pays $137million and the other party is not experiencing such costs.

George - 26 July 2013

Econet is fearing competition from Telecel. you guys fail to offer any value to your subscribers unlike Telecel which brings the best value to us customers. cowerds

Simba - 26 July 2013

Simba, what competition is there between a legal operator and an illegal one. You got your illegal value, now its time to pay up... Zvemahara hazvitapiri. Oo manje..

Hey - 26 July 2013

It's unprecedented for an operator to enforce regulations on behalf of the regulator, especially without authority. Econet on realizing that Telecel was engaged in “trading practices that have distorted the playing field” should have approached the regulator and raise the complaint. They erred in acting unilaterally, given that the responsible minister and the regulator are working on the issue of Telecel license. It would appear that Econet is a high cost operator, saddled with debts, presumably contracted through rolling out its network. However, that is a business risk of the operator and has absolutely nothing to do with the consumer. A consumer aspires for reasonably priced, good quality service. If Econet cannot compete with Telecel as is currently the case, then shareholders have a duty of turning around that company- that includes management changes to reposition the company to sustainability. Our position is based on the fact that Telecel is doing whatever it is doing to put more value in the consumer's pocket. We don't want to believe that Telecel is deliberately engaged in a “price war” with Econet simply for the sole purpose of hurting that company and perhaps pushing it out of business. If that is a case, then everyone is surely a loser. The focus and emphasis should always be to pursue ethical business practices, which sustain the industry whilst providing good quality service to users, at prices they can afford. Econet is too greedy. Its abusing our hard earned money and it is now trying to destroy the Samaritan (telecel). Pasi naMasiwa nechikwata chake chinoda mari zvakaipa kudaro. The license issue with telecel is not part of their business.

zvikombo - 26 July 2013

Telecel must comply with the laws of ZIMBABWE and pay all the costs other players are paying then the playing field becomes level and fair .As it is Telecel can afford to charge uneconomical rates because they are not paying the $140M other operators like Econet are paying. How can POTRAZ entertain complaints by an operator who does not comply with their regulations. When Dialy News refused to register with regulations it was closed so whats special abt Telecel . Telecel has approached POTRAZ with dirty hands and I am wondering why POTRAZ is even investigating when party of its conditions for the licence is that a licenced operator shld not register /interconnect with an unregistered operator .. Telecel must comply with Indeginisation Act & Post & Telecommunications Act vozotanga kutinyaudza ....

Proudly Zimbabwean - 26 July 2013

Telecel must pay up its dues or ship up.

systems - 26 July 2013

Telecel must pay up its dues or ship out.

systems - 26 July 2013

But Econet only paid 50% of the fee !

Duma - 26 July 2013

I agree with Econet a million percent. Telecel must pay license fees to even out the playing ground. you pride yourself of quality service yet you are enjoying free business. nothing comes for mahala. pay up or else you will lose business big time.

IT - 26 July 2013

Econet may be right but these seem to be like actions of a bull in a china shop and typical of large corporate arrogance using a sledge hammer to crack a nut. No thought on their own customers who have a genuine and legitimate expexpctation to reach anyone across the divide. So much for one world, one connectivity. Shame on you. Maybe it's because a woman is now in charge at Telecel, they have found their own Zulu to bully. Again I say they are right but is it justified. Surely the word negotiate comes to mind. Lets hope this is quickly resolved for the good of the country.

Mhofu - 26 July 2013

Telecel is offering mega juice and all these other products because the cost of licensing is not part of their overheads then the issue of indigenisation then the war veteran in the system its a messed up company and it has not had a license for years because it's license was canceled after econet was issued a license so how has it been operating and what has potraz been doing about this this is not the first time the license issue has come up even Potraz have threatened to shut them down before but political interference

warrior - 27 July 2013

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