NetOne drama exposes Govt

HARARE - The unravelling drama at NetOne Cellular (NetOne) has inadvertently given a glimpse into how the State-owned company has continued to suffer due to gross under-capitalisation and neglect by its shareholder, documents show.

While the issues have come up in papers forming part of suspended chief executive Reward Kangai’s defences to Information Communication Technology permanent secretary Sam Kundishora, the information at hand clearly shows that the mobile operator remains constrained by serious under-funding and inaction such that it plays second fiddle to private sector players in terms of size or capacity and equipment.

“By December 2012, Econet had invested $1,2 billion in its network compared to just under $200 million . . . by NetOne. It was submitted during (a) strategy workshop . . . in October 2015 . . . (that) Econet had more than 1 500 base station sites compared to 550 of NetOne,” the under-fire boss said in a February 19 letter.

While Kangai and company remain under the cosh of Alex Marufu’s board for running down the company through dodgy procurements, among other issues, the confidential documents also show that bureaucracy has impaired the company’s ability to access loans that could have helped it bridge the gap with competitors.

“ . . . efforts to get funding from (the) China International Telecommunications Construction Company’s...  ‘ubiquitous mobile broadband project’ have unfortunately, not been given the required support, notwithstanding that . . . a project feasibility study had been signed . . . in June 2015,” he lamented, adding management “believed . . .  the project would propel NetOne to the pinnacle position it once had”.

“It is further tragic that the chairman . . . is on record criticising the China Eximbank loan . . . NetOne would have been grounded, had phase 1 and 2 loans... not been provided,” Kangai said.

As the missive also shows the trained engineer taking a dig at current ICT minister Supa Mandiwanzira’s approach to the issues bedevilling the company — as compared to Webster Shamu — it has also emerged that the network had received piecemeal support from President Robert Mugabe’s government since receiving the country’s first cellular licence in 1996.

When it inked the $298 million Huawei Technologies (Huawei) around 2009, NetOne lost about 50 percent of the 350 base stations it was supposed to erect under the data deal on the Harare administration’s orders and several other components, if not subscriber-acquisition sweeteners.

The effect of that order — carried under the guise of cutting costs — meant that the company also lost vehicles and equipment to maintain the network, people familiar with the development say.

“The issue pertaining to bureaucratic procedures has not been given due consideration in comparing NetOne with other privately-owned operators,” Kangai said, adding this dated back to the Postal and Telecommunications Corporation  days.

According to the long-serving company CE, such inertia not only “continued to cloud NetOne’s operation”, but also “stifles innovation, while penalising innovators”.

And as the company continues to lag behind its competitors in terms of product innovation, and subscriber numbers, Kangai and his team have come out to be the fall guys such that they are facing a forensic audit.

As it is, the soft-spoken executive has been suspended for three months pending the outcome of the probe, which also seeks to understand his relationship with contractors such as Bopela and network suppliers, including Huawei.

And as the saga continues, Mandiwanzira’s efforts to unravel the NetOne saga has already been mired in Zanu PF’s endless factional fighting.

Comments (3)

net one and agrips musiya.... are guilty, there should be prosecuted after the audit

Harare - 21 April 2016

Net one is well funded, check the double purchases and decommissioning of equipment before useful life is exhausted.

amina - 21 April 2016

Munyori wapihwa marii naKangai?

Shumba - 22 April 2016

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