With a ten-city pilot underway, Safaricom breaks Ethio Telecom’s monopoly on Africa’s second most-populous country
Kenya-based telco Safaricom has announced that it’s launched services in Ethiopia, marking the first time a privately owned Communication Service Provider (CSP) has operated in the African nation. Up to now, Ethio Telecom has been Ethiopia’s sole CSP. Ethio Telecom is owned by the Ethiopian government.
Safaricom switched on service in the Ethiopian capital, Addis Ababa, late last week. Its pilot service has been activated in 10 Ethiopian cities, with plans to stage a nationwide rollout in 14 more cities by April 2023. The company has launched 2G, 3G and 4G services, it said. Safaricom is mandated to provide 25% of the Ethiopian population with coverage by the April 2023 deadline under the terms of the license granted to it by the government. Safaricom is building its own telco infrastructure, and is so far the only company in the country to launch a service to compete with Ethio Telecom.
Safaricom’s expansion into Ethiopia is part of the government’s “Digital Ethiopia 2025” efforts, it said in a statement. Safaricom investor Vodafone Sumitomo Corporation and CDC Group are partners in the new effort, which seeks to bring digital transformation to Africa’s second-largest country by population. It’s also one of the last countries on the continent to sport a monopoly telecom market. The government has expressed interest in selling off a minority stake in Ethio Telecom to raise badly needed capital, though those plans seem to have taken a back seat given current economic pressures.
Shortly after the service launch was announced, Ethiopia’s finance minister, Ahmed Shide, confirmed that the government had granted the company a license to operate its mobile money service in Ethiopia. Safaricom said it’s still a couple of months away from being able to flip the switch on that capability, however. Safaricom has seen considerable success in Kenya with its M-Pesa money transfer service.
M-Pesa has seen broad support from consumers who distrust banks and perceive mobile-to-mobile direct money transfer as a safer and faster way to keep money, and to pay for goods and services. Earlier this year, Safaricom announced that it had more than 30 million M-Pesa users in Kenya, and more than 51 million in total. Safaricom CEO Peter Ndegwa told reporters in March that the number of merchants accepting M-Pesa had increased from 173,000 to 387,000 from 2020 to 2022.
Safaricom already connects more than 38 million customers in its other operating regions. Closer to home, this past May, the company secured 2600 MHz spectrum by the Communications Authority of Kenya for its 5G network. Safaricom and rival Airtel were already performing 5G trials ahead of that time; Safaricom’s first trials began more than a year prior in the Kenyan cities of Nairobi, Kisumu, Kisil and Kakemega.
Nokia and Safaricom are working together on a pilot program to test 4G and 5G Fixed Wireless Access (FWA) network slicing. The tests took place in Kenya’s Western Region. Nokia claims this pilot program is the first time that 4G and 5G network slicing has been successfully tested anywhere in Africa. The pilot tested equipment from multiple vendors, and took place on Safaricom’s live commercial network. Nokia said that it provided base stations, network management software tools and Customer-Premises Equipment (CPE).
