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Zimbabwe - Telecoms, Mobile and Broadband

Attention: There is an updated edition available for this report.

The Zimbabwe - Telecoms, Mobile and Broadband report includes all BuddeComm research data and analysis on this country. Covering trends and developments in telecommunications, mobile, internet, broadband, infrastructure and regulation.

Executive summary

Zimbabwe’s economy has contracted for ten years in a row under gross mismanagement by its political leaders, sending annual inflation to an unprecedented rate of several billion percent and the exchange rate of the Zimbabwe Dollar to more than 50 billion per US$. Then in early 2009 the government finally gave up and allowed foreign currencies as alternative legal tender, which had already been the unofficial fuel of the local economy for years.

The ‘dollarisation’ has done miracles for the country’s telecom industry: Network operators, now able to bill their customers in hard currency, have regained a certain degree of planning reliability and access to funding for network expansions. Hundreds of thousands of US$ were invested into the three mobile networks in 2009 - Econet, NetOne and Telecel Zimbabwe. The subscriber base roughly doubled despite the fact that consumer prices initially rose - artificial price caps in local currency had meant that prices had previously been extremely low when converted into hard currencies. As a consequence, the average minutes of use on Zimbabwe’s mobile networks were ironically among the highest in the world, and the networks were congested. Prices are now more in line with other African markets again.

The normalisation of Zimbabwe’s economy is reflected in the International Monetary Fund (IMF)’s forecast of continuous GDP growth at 6% from 2010.

NetOne’s parent, TelOne (formerly PTC) still holds a de-facto monopoly on fixed-line services in the country. A second national operator (SNO), TeleAccess was licensed in 2002 but had its licence withdrawn in 2005 due to non-performance resulting from difficulties to raise funding. Another licensed operator, Afritell (a public-private partnership) also failed in bringing competition to the fixed-line sector. However, the government announced in 2009 that it recognises the urgent need for a second operator and that it is looking at ways to resuscitate or retender the licences.

In parallel, the government is planning to privatise up to 60% of TelOne and NetOne, either through an IPO or a strategic partnership with a foreign investor.

Despite the limited fixed-line infrastructure, Internet usage in Zimbabwe has continued to rise. In an environment of strictly controlled traditional media, citizens turned to the Internet for independent information and communication. However, limitations of international bandwidth for the landlocked country have affected development of the sector. New fibre optic links are now being deployed to improve international connectivity via neighbouring countries with access to international submarine fibre optic cables.

The ISP market is reasonably competitive with six major players. Eight companies were licensed in 2009 to provide VoIP telephony services. Several data carriers have been licensed and are rolling out national fibre backbone networks. ISPs have begun rolling out wireless broadband access networks, and the first 3G mobile broadband service in the country was overwhelmed by demand within weeks of the August 2009 launch.

After ten years in crisis, Zimbabwe’s telecoms market has a lot of catching up to do. The boom in all market sectors is expected to continue in 2010.

Key highlights:

Multi-currency system normalises telecom sector;
2010 estimates for mobile, fixed-line and Internet market;
Profiles of major players in all market sectors;
TelOne, NetOne privatisation planned;
Second fixed-line licence expected;
New draft ICT Bill 2009;
Universal Service Fund tapped for the first time;
Hundreds of thousands of US$ in network expansions;
New domestic and international fibre connections;
New VoIP licences;
3G spectrum allocation, service launches;
Internet and broadband pricing trends.One million dollars per minute

Zimbabwe’s hyperinflationary economy has meant that prices for mobile services have had to be increased by 1,000% or more on a monthly basis at times and reached millions of ZWD per minute. Ironically, the average minutes of use in the country were among the highest in the world during this time and the networks were congested, because most users appear to have access to foreign currency or other assets, and tariffs were extremely low when converted into hard currencies.However, the entry level for consumers is relatively high in Zimbabwe. SIM cards were sold for between US$15 and US$25, compared to US$5 in many other African countries, and the shortage of new lines resulted in the proliferation of a black market where prepaid starter packs fetch up to ten times the regulated official price.In January 2009 Zimbabwe’s telecom operators were given regulatory approval to charge for all their products and services in foreign currency. The move led to widespread consumer anger because it meant that prices in local currency would rise even faster. POTRAZ reacted by ordering service providers to slash tariffs by between 25% and 40%.Overall, however, the ‘dollarisation’ has meant that telecom operators were finally enabled again to run their businesses with a certain degree of planning reliability. The government has tried to impose price caps, but the network operators complained that they would go out of business if they were forced to operate below cost. Some of them suspended network expansion programs and the signing up of new subscribers until a tariff review was approved. Prices normalised and are now more in line with other African countries again, at around US$0.20 per minute for domestic calls.

For those needing high level strategic information and objective analysis on the telecommunications sector in Zimbabwe, this report is essential reading and gives further information on:

A market with ten years of lost time to catch up on;
The impact of the economic crisis;
Government policies affecting the telecoms industry;
Market liberalisation and regulatory issues;
Telecoms operators - privatisation, acquisitions, new licences;
Internet and broadband development and growth, including 3G mobile;
Broadband services and pricing trends;
Mobile Average Revenue per User (ARPU).This annual report provides a comprehensive overview of trends and developments in Zimbabwe’s telecommunications market. Subjects covered include:

Key statistics;
Market and industry overviews;
Regulatory environment and structural reform;
Major players (fixed, mobile and broadband);
Infrastructure development;
Mobile voice and data markets;
Average Revenue per User (ARPU);
Internet and broadband development and pricing;
Convergence (voice/data, fixed/wireless/mobile).

  • Executive summary
  • Key statistics
    • Table Country statistics - 2010
    • Table Fixed-line network statistics - 2009
    • Table Internet provider statistics - 2009
    • Table Internet user statistics - 2009
    • Table Mobile statistics - 2009
    • Table National telecommunications authority
  • Country overview (economy)
  • Overview of Zimbabwe's telecom market
  • Regulatory environment
    • Sector Reform Policy 1996
    • Posts and Telecommunications Act 2000
    • Telecom sector liberalisation
      • SNO licence
    • Regulatory authority
      • POTRAZ
      • Licence fees
    • Interception of Communications Bill
    • New nationalisation law 2008
    • New draft ICT Bill 2009
    • International gateways, interconnection
    • Value-added tax (VAT)
    • Universal service fund (USF)
  • Fixed network operators in Zimbabwe
    • TelOne
      • Table TelOne tariffs in US$, effective July 2009
      • Privatisation
      • Fixed-line infrastructure
        • Table Fixed lines in service and teledensity - 1995; 1997; 1999 - 2010
      • Wireless Local Loop (WLL)
      • National fibre backbone
      • International infrastructure
    • TeleAccess Zimbabwe (Pvt) Ltd (defunct)
    • Afritell
  • Broadband and Internet market
    • Overview
      • Table Internet users and penetration rate - 1996; 1998; 2000 - 2010
    • Public Internet access locations
    • Data carriers
      • Africom Zimbabwe
      • DataOne, SatNet
        • Table DataOne leased line tariffs in US$, effective March 2009
      • Powertel Communications
      • Telco Internet
      • Broadlands Networks
      • Aquiva
    • Zimbabwe's ISP market
      • Africa Online Zimbabwe
      • ComOne
      • Ecoweb
      • MWEB Zimbabwe
      • Zimbabwe Online (ZOL)
        • Table ZOL broadband pricing, December 2009
    • Zimbabwe Internet Exchange (ZINX)
    • Broadband in Zimbabwe
    • VoIP telephony
    • E-Commerce
  • Mobile communications
    • Overview of Zimbabwe's mobile market
      • Table Mobile subscribers and penetration rate - 1997; 1999 - 2010
      • Table Mobile operators, subscribers and annual change - March 2009
    • Major mobile operators
      • Econet Wireless Zimbabwe (EWZ)
      • NetOne
      • Telecel Zimbabwe
    • Mobile data services
    • Third generation (3G)
    • Satellite mobile

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