[2008-07-10]  10 years old, Econet prepares for brighter future
ECONET Wireless, Zimbabwe's biggest telecommunications company, has marked its tenth anniversary by announcing plans to grow market share further by aggressively investing in new technologies and improving service.

Econet's early operation was built on a base of 10 000 subscribers in 1998. The number has since surged to 650 000 users, and work to expand capacity to carry double this number is now almost complete.

But Econet is already looking beyond the 1.2 million user capacity, executives disclosed this week. However, in addition to signing up more subscribers, the next decade will see strategies designed to match network expansion with service and innovation, they said.

"The next challenge will not only be about expanding subscriber capacity and lifting subscriber numbers", said Douglas Mboweni, Econet chief executive officer. "Our strategy is also about meeting the rapidly changing demands and expectations of the modern telecoms consumer by deploying new technology, keeping abreast of emerging and developing technological trends."

Executives this week looked back at a decade that began with a mixture of hope and uncertainty in 1998, but ended with the company well in command of market share and being a key part of an international group active in 15 countries across four continents.

All this must have looked impossible in 1997, after an order was made to Econet to dismantle its equipment.

But, 12 months later, Econet was listed on the stock exchange after a record share offer three-times oversubscribed. And this was all within three months of its launch. Shareholders had to wait over five years for the first dividend, but Mboweni notes the company now not only declares dividends, but has delivered some of the sharpest capital appreciation on the ZSE.

"We thank our shareholders and partners for foregoing their dividends during our formative years. It is they who made us great," Mboweni said.

Three months into its operations, Econet was the first of the country's three operators to launch a pay-as-you-go service, "Buddie". In 2002, Econet combined its prepaid and post-paid platforms into a new hybrid product, "Libertie". In 1999, Econet launched the first WAP (Wireless Application Protocol)-based mobile browsing product of its kind in Africa.

But the economy turned, and Econet found itself having to review its entire business strategy. The business was minting cash, but the mounting cash-pile needed to be deployed as rising inflation threatened to erode value. The Zimbabwe dollar earnings could not be ploughed back into network development, funded almost entirely in foreign currency, while sub-economic tariffs were stunting earnings growth from the core mobile business.

The company then pooled its non-telecom assets into Econet Wireless Capital (EWC), its investment arm, and gave it the mandate to buy more investments outside its core telecoms business.

Now, executives say, the success of the new decade will depend on how well the company is able to exploit new technologies and find strategies that improve service to existing customers. "It is one thing to have a large subscriber base. It is quite another to make sure that base is active and viable. That's our next challenge," said Mboweni.

A 3G service is expected to be launched shortly. Commercial trial runs have already been completed, and frequencies are now awaited from the regulator.

Growing alongside its commercial clout has been Econet's social investment. Over 26 000 orphans currently receive assistance under the company's Capernaum Trust. This is the largest welfare programme currently running in the country.

The Joshua Nkomo Trust, named after the late Vice President and nationalist, is currently putting 100 more talented but disadvantaged students through high school. Over 300 have benefited from the programme since its inception four years ago.

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Source: Company's Website