4G expansion tightens the competition between Ethiopian telecoms

Ethiopian incumbent Ethio Telecom announced the availability of 4G in six new regions and plans to launch in a swathe of other locations in the coming months, a clear preparation for increased competition in the nation’s mobile market.

“There were 21.14 million Internet users in Ethiopia in January 2020, and it increased by 534 thousand (+2.6 percent) between 2019 and 2020,” according to Datareportal. “Internet penetration in Ethiopia stood at 19 percent in January 2020,” it added.

Xinhua News Agency reported that during February, the towns of Adama, Awash Melkasa, Bishoftu, Dukem, Gelan and Mojo received 4G coverage.

In addition, Ethio Telecom’s vendor partner ZTE noted that additional urban hubs would be connected within the next three months, noting that until recently, 4G had only been available in the capital Addis Ababa.

Ethio Telecom described its push to deliver 4G to regional towns as one of its “major strategic initiatives.”

The move comes as the Ethiopian Communications Authority prepares to issue two new mobile operating licenses to boost competition in a market that Ethio Telecom has long monopolized.

It has been widely reported the country could require new entrants to lease infrastructure from Ethio Telecom, potentially allowing them to offer 4G in the new hubs a launch.

However, with the deadline for new entrant applications still over a month away, Ethio Telecom would still have a significant head start on provision of improved data services.

While this would enable newcomers to offer 4G from launch in the newly covered areas, the World Bank recently cautioned against any move that weighted the playing field in favor of the state-owned incumbent.

Safaricom last week claimed to have made the shortlist of six candidates for one of the new licenses, prompting the ECA to shoot down the suggestion. Local media has reported that new entrants will be pushed – or possibly required – to lease infrastructure from Ethio Telecom.

As for the benefits that this network will bring to locals compared with previous mobile network technologies, 4G LTE offers much higher bandwidth (speed of data transfer), lower latency (faster response times from the network) and improved spectrum efficiency (increasing overall network capacity).

Africa’s second most populous country considers the telecoms industry its crown jewel as Prime Minister Abiy Ahmed seeks to energize dysfunctional state-run sectors of the economy with a raft of reforms.