After years of back and forth negotiations, Zimbabwe’s biggest mobile network giants, Econet and NetOne finally agreed on an infrastructure sharing deal.
Through a Memorandum of Understanding (MoU) the two parties committed to sharing infrastructure in a collective effort to bring connectivity and ICT services to all Zimbabweans.
Described by Econet CEO Mr Douglas Mboweni as a “giant step” and by NetOne CEO Mr Lazarus Muchenje as a “watershed agreement”, the infrastructure sharing deal is a welcome development that has been long coming.
Infrastructure sharing is not a new phenomenon as most European countries promote the sharing of passive infrastructure by mobile operators.
An example is the agreement between Orange and Vodafone to share infrastructure in the United Kingdom and in Spain, while managing their own traffic independently and remaining competitors at the wholesale and retail level.
According to Vodafone, the UK sharing agreement was meant to reduce capital and operating costs by up to 30 percent. In Spain, the arrangement was meant to reduce the operators’ number of sites by around 40 percent, while offering services to towns across the country with fewer than 25 000 inhabitants.
In developing countries in particular, mobile telephony has been central in making services available to large sections of the population.
However, much remains to be done to increase the penetration of mobile services, particularly in rural areas. The problem arises from the high cost of network infrastructure. This leads to high prices, as operators seek to recover their investment.
Mobile infrastructure sharing in telecom is thus an important measure to reduce costs. It is useful in start-up phase to build coverage quickly and in the longer term scenario to build more cost effective coverage, especially in rural and less populated or marginalised areas.
In Zimbabwe, infrastructure sharing is an idea that was probably first spoken of back in 2014 when the Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz) crafted a consultation paper on regulations for infrastructure sharing in telecommunications industry, which envisaged that an infrastructure framework based on an open access model, would realise the attainment of universal access to broadband and other ICT services on a reliable basis and at affordable prices in line with technological developments.
The Potraz consultation paper put forward the idea that “Infrastructure sharing provides opportunities for significant reduction in investments or capital expenditure.
In 2016 the government gazetted regulations which made it compulsory for mobile telecommunication operators to share infrastructure, but uptake of infrastructure sharing by telecommunication firms faced stiff resistance at inception with analysts saying the move would only benefit poorly resourced networks.
However, all that is now history as Zimbabweans are set to enjoy some of the benefits brought about by infrastructure sharing.
As put by the two companies in announcing the deal, “the landmark agreement is set to benefit millions of customers of the two operators through increased network coverage.”
It will also help reduce infrastructure capital investment expenses and lower operational costs for the two telcos which, in the long run, will increase efficiencies.
Potraz also believes that with infrastructure sharing, operators can achieve competitive tariffs for customers, roll-out in less profitable areas, and control excessive proliferation of towers.
It will also help operators to shift focus from network deployment to service-base innovation which eventually lead to customer-centric activities and a healthier competition, analysts say.
Moreover, spectrum sharing may have a potentially positive impact on customer experience. In fact, it could lead to better quality of service, through combining, their spectrum partners are able to offer higher data peak rates to consumers. Whoever is the most innovative and most customer-centric will rule the roost.
It also helps in optimisation of the use of scarce national resources such as right of way, steel, spectrum, etc.
Again it can lead to lesser potential emissions and radiation harmful for the public and environment. Ultimately, mobile network sharing can play an important role in increasing access to information and communication technologies (ICTs), generating economic growth and improving quality of life.
Given the challenges that the country is facing with regards foreign currency availability, the agreement will allow the two players to optimise the utilisation of scarce foreign currency as it eliminates the duplication of infrastructure.
However, there are a few catches. One caveat in all this is that although infrastructure sharing is expected to result in a reduction in infrastructure capital investment expenses and lower operational costs for the two telcos, in the long run, there is need to manage expectations as some level of investment still need to be met.
The infrastructure that is difficult to share is the “active” infrastructure, which includes the electronic components of the radio access network (RAN), such as the actual radio base station units and accessories. Such investment still need to be met.
One good example is that although there are some similarities in infrastructure, there could also be challenges in incompatibility of equipment and systems employed by other operators and this could be a major deterrent to infrastructure sharing.
This hinders interoperability which is the ability of systems or equipment from both sides, to operate without problems of mismatched configurations.
This is due to fact that many operators often employ different suppliers or vendors in their value chains as a source of competitive advantage.
As not all MNOs use the same network supplier or make use of different technologies/protocols, this can also cause technical difficulties and thus need close cooperation.
Cooperation in a competitive environment can be quite complicated, as it requires consent and coordination between the sharing parties, making site evolutions more time consuming because of the joint decision-making process.
Also from a technical viewpoint, if network issues or failures arise, debugging may be more complicated.
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Publish date : 2019-06-04 07:51:43