The invention of the telephone was considered as superstitious mater as one turns the page of history and chronology about the sector’s development. It is also a recent memory that people used to broadcast message standing in the nearby mountains to herald or mourn for relatives. Here is an article on the evolution of Ethio Telecom and its success in the telecommunications sector.
Documents unveiled that over the past two decades, the Ethiopian telecommunications landscape has undergone a remarkable transformation, with Ethio Telecom leading the charge. What was once a manually-operated, state-owned monopoly has blossomed into a highly capable, technologically-advanced service provider that has become the competent across Africa?
Ethio Telecom, formerly known as the Ethiopian Telecommunications Corporation (ETC), was established in 1894 under the reign of Emperor Menelik II. In its early days, the network relied on manual switching and routing, with operators physically connecting calls through a series of cables and switchboards. This labor-intensive process limited the network’s capacity and service quality.
“When I first joined Ethio Telecom in the 1990s, we were still using these large mechanical switchboards to route calls,” recalls Yared Tsegaye, a veteran engineer who has witnessed the company’s evolution firsthand. “It was an arduous task, and our ability to scale the network was severely constrained.”
The turn of the century marked a pivotal moment for Ethio Telecom. Recognizing the need to modernize its infrastructure, the company embarked on an ambitious digital transformation journey, investing heavily in network upgrades and the deployment of cutting-edge technologies.
“We knew we had to make a radical shift if we were to keep up with the growing demand for reliable, high-speed telecommunications services,” Birhanu Regassa, Ethio Telecom’s Chief Technology Officer said. “With the support of our government and strategic partners, we began transitioning our network to fully digital, IP-based systems.”
Over the following decades, Ethio Telecom systematically upgraded its network, migrating from analog to digital switching, implementing fiber-optic backbones, and rolling out 2G, 3G, and 4G cellular technologies. This modernization not only improved service quality and coverage but also laid the foundation for future advancements, according to documents.
In 2022, Ethio Telecom made headlines when it became the first operator in Africa to launch a commercial 5G network. This milestone achievement underscored the company’s technical capabilities and its unwavering commitment to providing its customers with cutting-edge connectivity documents furthersaid.
Ethio Telecom’s evolution has had a profound impact on Ethiopia’s social and economic development. By expanding access to reliable, high-speed internet and mobile services, the company has empowered citizens, businesses, and government agencies to unlock new opportunities and drive progress.
“Ethio Telecom has been a vital catalyst for Ethiopia’s digital transformation,” Yared Tsegaye said. “From telemedicine and e-government to mobile banking and Internet of Things(IoT) applications, our network has become the backbone that supports the country’s transition to a more connected, technologically-advanced society.”
As Ethio Telecom continues to innovate and push the boundaries of what’s possible, the future of Ethiopia’s telecommunications landscape looks brighter than ever before. With its impressive journey from manual operations to 5G dominance, the company has set a new standard for excellence in the African telecommunications industry.
State-owned Ethio telecom generated an impressive 93.7 billion Birr in revenue for the year 2023/2024, marking a 21.7% increase compared with the previous year.
This revenue surge, an increase of 16.7 billion Birr, achieved 103.6% of the company’s targets in all key metrics, it was learned.
CEO of the company, Frehiwot Tamiru presented the company’s annual business performance, revealing that net profit reached 21.79 billion Birr, reflecting a 20.9% growth from the previous year, achieving 108.7% of the target. The company also generated a total of 198 million USD from foreign exchange, a 20.7% increase, achieving 117.5% of its target.
Frehiwot noted significant savings of over 4.5 billion Birr during the budget year, achieving 134% of the target. The company’s unaudited report shows that Earnings before Interest, Tax, Depreciation, and Amortization (EBITDA) reached 42.44 billion Birr, a rate of 47%, achieving 102.4% of the target.
Ethio telecom transacted 1.81 trillion birr through telebirr during the budget year, with a total of 2.55 trillion Birr transacted since its launch in May 2021. The company expanded its customer base to 78.3 million, achieving 100.4% of its target, and telebirr subscribers reached 47.5 million, capturing 45.7% of Ethiopia’s mobile money service users.
According to the CEO, the company’s telecom coverage reached 99.2%, with geographic coverage at 85% and tele-density at 71%. Ethio telecom ranked 2nd among African operators and 17th globally. The company paid 29.76 billion Birr in taxes, 9.97 billion Birr in government dividends, and 3.4 billion Birr in foreign loans for previously held telecom expansion projects.
Frehiwot attributed the success to the commitment and effort of the company’s leadership and employees. Efforts were made to enhance the capacity and coverage of telecom and digital infrastructure, including the expansion of 4G and 3G networks at numerous sites.
The 4G network now extends to an additional 124 cities and districts, increasing accessible 4G cities to 424, and the number of 5G stations has risen to 189.
Ethio Telecom, the state-owned telecommunications company in Ethiopia, has played a significant role in the transformation of the banking and financial sectors in the country. Here are some of the key contributions of Ethio Telecom to this transformation:
Improved Telecommunications Infrastructure: Ethio Telecom has been investing heavily in upgrading and expanding the country’s telecommunications infrastructure, including the deployment of high-speed internet and mobile networks. This has enabled banks and financial institutions to adopt and implement various digital financial services, such as mobile banking, internet banking, and electronic payment systems.
Mobile Money Services: Ethio Telecom’s mobile money service, known as M-Birr, has been a game-changer in the financial sector. M-Birr allows users to perform a variety of financial transactions, such as money transfers, bill payments, and mobile top-ups, using their mobile phones. This service has significantly increased financial inclusion, particularly in rural and underserved areas.
Integration with Banking Systems: Ethio Telecom has worked closely with banks and financial institutions to integrate its telecommunications’ services with their banking systems. This integration has enabled seamless transactions, improved efficiency, and reduced the need for physical branch visits, contributing to the overall digitalization of the financial sector.
Promoting Digital Literacy: Ethio Telecom has been actively involved in promoting digital literacy and financial education among the general population. This has helped to increase the adoption and usage of digital financial services, particularly in regions with limited access to traditional banking services.
Enabling Fintech Startups: The improved telecommunications’ infrastructure and services provided by Ethio Telecom have fostered the growth of fintech startups in the country. These startups have been able to leverage the telecom’s capabilities to develop innovative financial solutions and services, further transforming the banking and financial sectors.
Overall, Ethio Telecom’s contributions have been instrumental in driving the digital transformation of the banking and financial sectors in Ethiopia, enhancing financial inclusion, improving service delivery, and fostering the growth of the fintech ecosystem.
BY LAKACHEW ATINAFU
THE ETHIOPIAN HERALD SUNDAY EDITION 28 JULY 2024
