The Communications Regulatory Authority of Namibia (CRAN) is worried about the monopolistic state of the country’s telecommunications sector.
The market is dominated by the state owned fixed line operator Telecom Namibia and its mobile unit, TN Mobile, and the country’s biggest mobile operator, MTC, in which Portugal Telecom has a 34% stake. The government owns the rest of the shares in MTC.
CRAN said in the 2014 Market Report that the Namibian telecommunications sector declined from three national mobile operators to just two in the last three years.
The Authority said this has left the country a “quasi-mobile and an actual fixed-line monopoly, both majority state owned.”
CRAN said the takeover of the only fully privately owned mobile operator, Leo (now branded TN Mobile), two years ago by Telecom Namibia crowded out private investment in favour of public investment.
CRAN stated in its report that due to the declining business model of Telecom Namibia and inadequate fixed broadband offerings, Telecom is losing voice and data revenue to MTC and, as a consequence, lacks the capital to build a mobile network that could compete with MTC.
“Fixed broadband cannot compete with mobile broadband neither on speed, quality nor on price, and only has a slim niche of uncapped Internet,” the CRAN report stated.
The report also said when Namibia is compared internationally for mobile broadband, mobile prepaid voice and leased line prices, the country falls behind in terms of affordability.
CRAN warned that the lack of competitive pressure in Namibia will let the country fall further behind. This after Namibia was leading in Africa in 2009 and 2010.
Namibia’s wholesale prices are even higher when compared to Botswana and South Africa and the margin between retail and wholesale prices are the lowest, giving resellers only a markup of 30% compared to 50% in South Africa and 80% in Botswana.
CRAN statistics show that through the takeover of Leo, Telecom Namibia increased its number of mobile base stations in operation from 269 to 409.
CRAN added that Telecom Namibia still needs to improve its network footprint by more than double if it wants to compete with MTC’s 1 088 base stations
On the international front, Telecom has de-invested from its foreign ventures. It has sold its 44% share in Mundo Startel of Angola, as well as selling its 11,7% stake in Neotel of South Africa.
