Leading telecommunication operator Safaricom will have to share its mobile telecommunication towers with rival Ethio Telecom, a state-owned entity, after both companies reached an agreement on interconnection and capacity lease.
The Ethiopia Communications Authority (ECA) hosted a mediation session with both entities, in which “an agreement was reached on all unresolved matters”, including sharing of tower infrastructure.
According to the regulator, “the current negotiations between Ethio Telecom and Safaricom Telecommunications Ethiopia Plc on tower infrastructure, transmission capacity lease and interconnection have been resolved.”
Ethio Telcom added that it had a productive meeting with Safaricom Ethiopia and that both entities will be signing an agreement.
The current Prime Minister of Ethiopia is focusing on the privatisation of the telecommunications industry by licensing new start-ups like Safaricom and only privatising a portion of the state-owned telecommunication.
Ethiopia is eager to issue a second private operator license but has since paused the process because of social unrest in the Tigray region, creating concern with international stakeholders.
Safaricom Ethiopia is supported by international telecommunication groups Vodacom and Vodafone.
Safaricom indicated that the current security unrest in the Tigray region is causing issues with some investors, but the entity remains confident in its business operations and objectives and notes that the agreement is a significant milestone for a digital Ethiopia.
The agreement will also provide Safaricom with a chance to lean on its experience in Kenya to roll out mobile money operations in Ethiopia, where some industry experts have described the country’s digital payments sector as underdeveloped.
The agreement comes at an appropriate time, given the renewed focus on several markets in Africa, focusing on sharing infrastructure and expanding network coverage to underserved communities and on entities that operate in cell phone tower management to service and handle base stations for other operators.