MTN CEO calls for industry consolidation

MTN CEO calls for industry consolidation

06 NOV 2014

LIVE FROM GSMA MOBILE 360 AFRICA: Sifiso Dabengwa, MTN’s Group CEO, called for governments and regulators to give a green light to M&A activity between operators in fiercely competitive markets, as well as urging greater clarity on spectrum availability.

Allowing consolidation would ensure that market and company failure is avoided as much as possible, said Dabengwa (pictured).

“It is going to be very difficult in some markets to sustain five, six, seven, eight operators who are going to have to invest quite significantly in competitive markets,” he added.

However, he predicted  that without consolidation, or a significant change in cost structure, company failure would occur.

Allowing consolidation “will ensure those failures are not catastrophic but are well managed and the industry is able to grow.”

Another concern is how government frees up the radio frequencies for future industry  expansion.

“We still see quite a lot of markets where there is very little clarity about spectrum allocation policy and also policies that are focused on ensuring that spectrum utilisation is most efficient and that for us is a major concern.”

Significantly, he added that today “there is not a single city in the African continent which is experiencing LTE or 4G technology on a contiguous basis”.

He also flagged up device issues. “Where there has to be a significant rollout of 3G we still face challenges from an affordability point of view, so we really need to look at affordability of 3G or other devices that will help improve internet penetration in our markets.”

Finally, Dabengwa called on governments to support network rollout in rural areas through universal service funds.

“There is a significant amount of funds that have been contributed to these service agencies which I believe should be used almost immediately to make sure we are pushing out in all these areas,” he said.

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Richard Handford

Richard is the editor of Mobile World Live’s money channel and a contributor to the daily news service. He is an experienced technology and business journalist who previously worked as a freelancer for many publications over the last decade including...

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