Ethio telecom, as an enabler for the socio-economic development of the nation, has been serving Ethiopia for the last 127 years since its foundation in Ethiopia in 1890 during the reign of Emperor Menelik II. According to the growth strategy of the company that covers a time period from 1 July 2021 to 30 June 2024 and a business plan from 1 July 2021 to 30 June 2022, Ethio telecom management took the initiative to develop a three- year strategic plan to meet the market dynamism, reshaping and leading the company with a competitive mindset with the ultimate aim of making the company a Preferred Operator. As this budget year is the third year of the strategic plan, the strategy is enhanced and enriched taking the current conditions and new developments into account.
Regardless of its current initiation and notable performance in expanding digital service for various sectors and high achievement in revenue earning, it is witnessed that the company has done little compared to the history it has registered when compared to the date it was established. However, contrary to its long time shamble, there have been swift changes regarding to services in recent years.
Once, the late Prime Minister Meles Zenawi described the Ethio- Telecom as ‘the milking cow’ while responding to the request of privatizing some percent of ownership of the company to indicate that it is a money machine to the nation’s economy. It is true that the Ethiopian Telecommunication Corporation or Ethio- Telecom has been the cornerstone for the general development of the country as the governments in different regimes have used the company’s income for different financial needs of the nation.
It has been witnessed that the company has been involved in backing many national projects in several occasions. This company has been the grand sponsor of many infrastructures throughout the country and economic power house for the Ethiopian development.
As the company has been worked as a sole telecom provider for the entire country which is the second most populous in Africa, the people of the nation want more from the services it is providing as the rest of the world have gone long distance ahead. Among other reasons, the new government of Ethiopia led by Prime Minister Abiy Ahmed (PhD) has come to a decision on letting partial privatization of the company aiming to boost the sectors service and earning remarkable hard currency. As a result, the decision attracted many giant international telecom companies around the world to bid on and be a part of the business.
According to a report from Capacity Media, in the past years, following the announcement from the government to make the company privatize, the revenue that the company collected at the end of the 2019 fiscal year was 22 billion Birr or 680 US dollars which is raised by 32 percent compared with 2018 and 4 percent greater than the target for the same year.
Ethio telecom has increased its capacity to stretch its wings and fly to every corner of the country and serve the people in good quality. In relation to this, the company scaled up its customers in each fiscal year.
In 2020/21 fiscal year, the company has continued scaling up its profit. The annual revenue for the fiscal year was 56.5 billion Birr. In the report, Ethio- telecom CEO Frehiwot Tamiru said that the company has been developing rapid infrastructure of services and expanded the internet access to 4G LTE connections. This has added the satisfaction of customers.
According to The CEO, there have been changes regarding figures, in number of customers and services. For instance, the company introduced and offered 34 new and 28 revamped services and products including the introduction of ‘telebirr’ which has gained more than 6.5 million subscribers and transacted over 350 million Birr in just two months.
In order to get better profits, any company must work hard to have a number of customers who can be satisfied by the services and products of the company. Ethio- telecom has been doing the same regarding the increment of customers and introducing new services and products. According to the report, Ethio telecom has also planned to increase total number of subscribers by 14 percent to 64M, Mobile Voice subscribers by 13 percent to 61.37 M, Data and Internet users by 16.2 percent to 28.5M, Fixed broadband subscribers by 48 percent to 554K. This is expected to bring telecom penetration to 61 percent.
During the press briefing, the CEO further explained that the number of fixed broadband users has elevated by 465 percent which is from 66,200 to 374000 users. From this figure, the company generated 166.5 million USD from international businesses. So that the overall achievement for the 2020/21 fiscal year showed 66.7 percent increment compared to the previous years.
From the company’s report posted on its official website, in the coming three years, the company plans to achieve the best in relation with market dynamism and changing employees’ mind set so as to make the company a preferred operator. It set strategies to address customer demands via creating digital better economy, improving the qualities of the products, and using up to date technologies to upgrade the revenue system by acquainting the customers with mobile financial services. In addition, the company plans to offer services in low and affordable prices.
In the coming fiscal year, the company plans to expand the network system capacity to address the society with more digital services. It has been reported that the company has expanded 4G/LTE network in the capital Addis Ababa and regional towns. In the coming years, the company plant to uplift these services in the capital and regional cities and towns. Therefore, 3.88 million Birr will be allocated for additional mobile network expansion.
In the following three years, the company plans to change and achieve better services so that it aims to generate 70 billion birr revenue. It is simply learnt that the company has recorded bold revenue incomes. This is simply seen when we compare the planned revenue income with the previous ones. For example, in 2019, it was 22 billion Birr which had 32 percent different with the previous year of 2018. Again, last year the company achieved a total of 56.5 billion ETB revenue, which is 101.7 percent of the target and 18.4 percent increment over the previous budget year similar period.
As it is learnt from the performances of the previous fiscal years, the company’s track record indicates that it has the capacity to achieve what it planned. Even during the current situation in which the country is engaged in law enforcement and sovereignty marching, the company has been doing well in all aspects. It is backing the nation economically enabling to carry out the hardship situation and conclude with victory. This contribution from the company in supporting the economy will continue.
Though the future is bright for the telecom service and better benefit of the costumers, it poses challenge to the company because of the competition from well experienced companies join the sector due to the introduction of privatization scheme. Therefore, for the company to sustain being preferred operator and to keep up its financial achievement it should work hard even more than before, it is said.
BY DANIEL ALEMAYEHU
THE ETHIOPIAN HERALD AUGUST 31/ 2021
