Business

Data, internet services to drive telecoms

Dr Machengete

Enacy Mapakame

Data and internet services are expected to continue driving the telecoms sector growth, according to regulator Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ).

This comes as businesses in Zimbabwe have embraced digitalisation, accelerated by the outbreak of the Covid-19 pandemic. The pandemic has necessitated use of digital platforms to reduce physical interaction as part of measures to reduce the spread of the disease.

According to a POTRAZ 2020 third quarter report, there was a surge in use of Internet and data services during the period as the market shifts to digital platforms. With no immediate solution on sight for the pandemic, it is anticipated that data usage will continue to remain critical going forward.

“The Covid-19 pandemic has demonstrated the critical importance that telecommunications infrastructure plays in keeping businesses, governments, and societies connected and running,” said POTRAZ director-general Dr Gift Machengete in an update.

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“The sector has been critical in keeping the global economy moving under the lockdown by providing business-critical connectivity and resilience, facilitating work-from-home arrangements and keeping individuals and societies connected and informed, with access to essential services during mandated social isolation. As a result, many telecom players providing broadband have benefited from a surge in the traffic of data as shown in this report.

“Data and Internet services will continue to drive industry growth,” he said. According to the third quarter report, mobile internet and data grew by a 43 percent to record 14,878 terabytes from 10,407 terabytes recorded in the second quarter of 2020. The report also shows that in-bundle data constituted 95,1 percent of total mobile Internet and data usage, up from 94,1 percent recorded in the second quarter of 2020 as consumers will always seek to maximise their utility with the cheaper promotional bundles instead of out-of-bundle data rates.

Econet maintained its market dominance adding another 8,9 percentage points to command 69,7 percent of total market share, while NetOne lost 9 percentage points to close the quarter with 29,1 percent of market share, while Telecel catered for the remaining 1,2 percent.

During the quarter under review, active Internet and data subscriptions grew by 5,6 percent to reach 8 726 904.  As a result, the internet penetration rate increased to 59,9 percent from 56,7 percent recorded in the previous quarter.

POTRAZ also highlights that a huge growth in equipped international Internet capacity was recorded in the third quarter under review following expansion by Liquid, TelOne and Dandemutande.

“As demand for Internet and data increases due to the adoption of e-learning, telecommuting, e-health, IAPs will need to continue expanding their bandwidth capacities to meet the demand,” reads part of the report.

Just like any other sector of the economy, the performance of the telecoms sector going forward will largely hinge on the general economic environment.

Availability of foreign currency, exchange rate and inflationary pressures will have a direct impact on service tariffs for the sector.

HERALD

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