Safaricom Ethiopia has been official for an extended period, but entry to the country was not easy.
Specifically, Safaricom, among its partners (Vodacom Group, Sumitomo Corporation, and CDC Group all named Global Partnership for Ethiopia (GPE)), had to bid $850 million, which was much higher than rivals who wanted a piece of Ethiopia’s lucrative telco business. The country has a population of more than 110 million people.
Ethiopian authorities then allowed the company to set shop in the county in May 2021. But it was just that because no commercial operations have been rolled out yet. The plan was to go live by April 2022, but that did not happen for reasons that were not explained to the media.
Still, Safaricom’s entry into Ethiopia means that it must meet some goals. For instance, it plans to roll out LTE service by 2023 (Ethio Telecoms has already started piloting 5G). With its partners, Safaricom Ethiopia will also invest USD 8.5 billion over the next ten years.
The investment should see the transaction create 1.1 million jobs for Ethiopians.
In September 2021, Safaricom started a country-wide recruitment exercise in Ethiopia. The exercise sought to pick key leaders that would guide it to its visions and missions. Also, Safaricom had said that the process showed its commitment to the country’s digital future prior to commercial launch.
By the end of September, Safaricom had picked its top management team, including nationals from Kenya and Ethiopia. You can find out more details about them here. Safaricom adds that it has recruited 500 employees. 320 of them are Ethiopian.
Now, it has emerged that the operator will start rolling out operations in August 2022. This is four months behind schedule. Still, telecom services will still be launched intermittently, with wider coverage set out for 2023.
One of the first regions that will be served is Dire Dawa. By April 2023, Safaricom will be available in 24 Ethiopian towns.
Over the course of 2022, Safaricom Ethiopia has made some noticeable strides, including the set up of a $100 million data centre. It has since built a second data centre.
Ethiopian authorities have also made some changes regarding the operation of foreign mobile money products, meaning M-PESA now has a chance to launch in the country as well.
“Safaricom Ethiopia is looking forward to switching on our network and services, starting with Dire Dawa from August 2022 and 24 other cities in phases across the country in the coming months. Currently, we are in a testing period to ensure that when we switch on, we will deliver a quality experience for Ethiopians. We are working to fulfill our commitment to building the long-term foundations for our contribution to Ethiopia’s digital transformation and inclusion objectives to transform lives for a digital future,” said Matthew Harrison Harvey, Chief External Affairs and Regulatory Officer.
Developments and Summary
Safaricom Ethiopia acquired its operating license in July 2021.
It has invested in network and building infrastructure, including mobile radio towers national transmission networks and wholesale agreements for international connectivity.
Invested USD 1 billion so far. The amount includes license fees.
It has imported equipment worth over USD 300 million.
The firm has developed core network, IT, products, call centres, and services.
It further signed infrastructure sharing and interconnect agreements with Ethio Telecom.
Safaricom Ethiopia has onboarded 29 distributors across the region.
Finally, it has advanced commercial launch plan for retail stores and undertaken Supply Chain tenders for Ethiopian companies to partner with it.