Gov’t set to break MTN ‘monopoly’
The government has announced plans to break MTN’s ‘near monopoly’ in the country’s telecommunications space, theghanareport.com has confirmed exclusively.
The Ministry of Communications said MTN’s 75% market share represented “glaring disparities” and unhealthy competition.
Three other telcos, AirtelTigo, Vodafone and Glo, to scrabble over 25%. They have been no match for MTN and the gulf has been widening even more over the past three years, a press statement intercepted by theghanareport.com suggested.
Currently, MTN has a 75% share of the voice market and 65% of data.
The Communications Ministry said it would be using the Electronic Communications (EC) Act 2008 and the National Telecommunications Policy to address the “imbalances”.
The Ministry explained that per the National Communication Policy, any operator with more than 40% market share in voice, data, SMS and value-added services like Mobile Money, is considered a Significant Market Power (SMP).
This designation means the government is bound to take steps to “corrective measures under the law to facilitate more market competition.”
Sector imbalance
The government expressed fears that “this imbalance potentially exposes the country to the dictates of the dominant operator and negatively impacts on competition and choice for the consumer as well as investments within the sector”
The statement revealed it had met with the telcos to discuss the “uncompetitive and unprofitable environment for less dominant players in these industries”.
The Communications Ministry has, therefore, issued at least six directives, which are part of “specific policies to ensure a level-playing field for all network operators.”
“These measures kick in immediately and the NCA is expected to work with all Network Operators who must cooperate to ensure it is done painlessly.”
The ministry suggested in its press statement that consumers should expect “proper pricing” of MTN services after the implementation of the measures.
The Ministry said the move should not be seen as a punishment, but a correction. The statement indicated that it was not singling out MTN, explaining all other operators which were once dominant in the past had their wings clipped.
South African-based company, Scancom Ltd (MTN Ghana), was incorporated in 1994 as a private limited liability company.
In 2016, MTN became a public company listing on the Ghana Stock Exchange (GSE) in September 2018. It is the largest company on the GSE by a number of Ghanaian shareholders, with 127,826 shareholders representing a value of Gh¢444 million.
In a testament to MTN’s stranglehold of the sector, MTN Ghana in 2018 won 40 awards including the prestigious Company of the Year 2017 by GIPC’s Ghana Club 100 Awards.
MTN is the only Ghanaian company to win the UK-based Investor in People Accreditation–Gold Employer of the year award.
For the past five years, the Ghana Revenue Authority has given MTN, great compliments and awards for being the largest taxpayer in the Large Tax Payer Category in the country. MTN Ghana has over the past five years contributed an average of approximately 3% of the total tax revenue in Ghana.
MTN Ghana recorded GH¢1 billion in profit for 2019 after tax. This represents a 33.56 percent higher profit compared to the figure earlier recorded in 2018.
But complaints about the cost of data, vanishing bundles have plagued the company.
In January 2020, subscribers lamented for days after MTN said its undersea cable in Europe had been cut, causing significant disruption in its services.
Yes, The laws are made to regulate and sanitize the operating system generally but, Why would govt want to disenfranchise an organization that is putting in a lot to achieve the goals / targets shareholders’ set out for the organisation at AGM. Honestly, I think it’s not fair. That portion of the law needs reviewed. Has MTN failed in meeting all obligations both the govt & the shareholders. The other telcos should diversify and get their axe right.
The Bible even appreciates reward for hard work and profit ( the parable of the talents) it was open ended so you see. MTN works hard and excellent productivity rewards it and pays all it’s due.
My opinion is, let the other telcos also diversify thru GSE, get the needed capital to expand, be more efficient and accountable to the shareholders then competition will not be skewed. NCA, rather, encourage healthy competition and review that section of the law.
The govt is likely to lose lots of financial support from MTN which the other telcos together cannot augment if mtn’s wings are clipped.
But, the bigger question is is govt going to tell MTN you have reached ur saturation point therefore MTN should not take on new subscribers if they wish for MTN as the service provider . Pls reconsider the decision careful. Certain policies are disincentive. Take a step back & reconsider the impact of that section of the law. Remember MTN is on the stock exchange GSE and needs to pay dividend to it’s shareholders’ etc. How does it aspire to great heights if the sky is not the limit. Other telcos should restrategise Pls. So that competition begins and not actions taken skewed to reward inactions of other competitors. Thanks
Excellent Peter…. As a country, wouldn’t it make more sense to encourage business expansion…. the other telcos should sit up…. for me I think that the government should focus on customer exploitation as this a high risk associated with entities enjoying ‘monopoly’ … I have been impressed with MTN… they are serious… the others should get serious
You classically spoke my mind. It is not MTNs fault that they are ruling the market. Do we expect MTN to direct the other networks on how to compete properly? Or MTN to invest in their competitors structure for effective competition.
Which kind law be this?
Exactly my taughts…. are they encouraging productivity or what ?
Massa relax. They can’t do foko. Abi we are all in Ghana. It’s all paper talk. MTN will still stand tall. They are doing well. They just need to iron out a few wrinkles. That’s all.
I side with you wholeheartedly on the points enumerated above. The other players in the market are not serious. Just comb through Africa and see if the situation is same everywhere. The rest of the players in the Ghanaian market are sleeping and not doing what is expected off them. MTN is ahead because of it understanding of the market and operating environment here in Gh. This policy if implemented will be counter productive and will serve as a disincentive to other investors who intend coming into the business space in Ghana.
I don’t blame mtn. And we’ll continuesly run for them to make them proud. Can you imagine tigo; as now know airteltigo is my first Sim card I bought. I bought the sim while I have no phone immediate they switched from buzz to tigo before areeba became mtn. But uptil now tigo isn’t make attempts to go for 4g. Do you expecting me to buy 4g phone and put in 3g dim? Are u guys serious? Better poblish yourself and a challenge on MTN
I don’t blame mtn. And we’ll continuesly run for them to make them proud. Can you imagine tigo; as now know airteltigo is my first Sim card I bought. I bought the sim while I have no phone immediate they switched from buzz to tigo before areeba became mtn. But uptil now tigo isn’t make attempts to go for 4g. Do you expecting me to buy 4g phone and put in 3g sim? Are u guys serious? Better poblish yourself and put a challenge on MTN
Mtn data is expensive and when you buy too it vanishes in a jiffy. It makes me dislike their services. Moreover, the network itself is bad at my end. 4G paa but the bars go off. Too bad!
It’s not only about how much the country makes from them but it’s also about risk management because if only focus on the profit and forget about the high risk then that is not good. Should mtn have a challenge no matter the situation be it through a fraudulent activity or a system failure as a nation that would be bad for us since they hold about 75% of the countries voice market. The limitation in communication alone not to talk of the financial aspect. Like the banks they should have an operating limit
Mtn is the best network in wnich i have ever use, the rest are not good ,very fast reliable network communication which the government must support them. They are really working hard in the county for the government to get more revenue . MTN still the best network communication in Ghana, no any network again no size.