NetOne CEO makes US$1bn move

NetOne, Zimbabwe's oldest mobile telecoms operator, has laid ambitious plans to achieve US$1 billion in annual revenue by 2029, despite facing challenges in accessing capital. Chief executive officer Raphael Mushanawani, who has been at the helm for nearly two years, disclosed these plans during an interview with the Zimbabwe Independent. Mushanawani expressed confidence that the state-run operator had identified growth opportunities that could drive the company's dramatic turnaround.

The US$1 billion target represents a significant leap from the company's projected revenue of US$160 million in 2024, reflecting a more than sixfold increase over the next five years. NetOne, which was the first to be licensed as a mobile telecoms provider in 1996, now faces stiff competition, particularly from market leader Econet Wireless, which entered the industry two years later after a prolonged legal battle with the government.

Mushanawani emphasized that the company's growth strategy will center on meeting rising demand for data services, as the telecoms market continues to evolve. However, he acknowledged that this would require retiring outdated technologies and upgrading its network infrastructure to 4G capabilities.

"Normally, we set ourselves to reach a target," said Mushanawani, referring to the company's revenue goals. "This year, we set ourselves a target of US$160 million. That is what we are working to achieve. We want to be the number one network. We are seeing ourselves becoming a US$1 billion company within the next five years."

Despite his optimism, Mushanawani admitted that the journey to dislodge Econet as the market leader would not be easy. Econet, listed on the Zimbabwe Stock Exchange, recorded 10,436,233 active subscribers in the first quarter of 2024, while NetOne trailed significantly with 4,017,167 subscribers.

"We remain number two in the market," Mushanawani said. "It is not a good position that we want to find ourselves in. We all know who the dominant player is. However, we are confident that in the not-so-distant future, we will reclaim our position. I don't see why we should not be number one. I am seeing that soon we should be the most preferred network, the most efficient network, with the widest coverage and the most subscribers."

Mushanawani's optimism comes at a time when the country's mobile operators are grappling with economic turbulence. The first quarter of 2024 was marked by a decline in active mobile subscribers across the sector, as inflation and currency volatility reduced disposable incomes and led consumers to cancel their lines. Telecel, the third-largest operator, also reported markdowns in its subscriber base.

Industry experts have pointed to market saturation as another factor contributing to the decline. Jacob Mutisi, chairperson of the Zimbabwe Information and Communication Technology (ZICT), noted that the mobile market in Zimbabwe has reached a point where most potential subscribers already have access to services.

"The decline in mobile subscribers and penetration is attributed to the saturation of the mobile market," Mutisi explained. "The population has reached a point where most individuals who can access mobile services already have a subscription. There are also economic factors, such as increased cost of living or reduced disposable income, leading some consumers to cancel or not renew their mobile subscriptions."

Mutisi added that competition between mobile operators, as consumers seek better deals or improved service quality, is also contributing to the shifting dynamics in the sector.

As NetOne charts its course to challenge the status quo, the company's ability to secure capital for network upgrades and meet the evolving demands of the market will be key to achieving its ambitious US$1 billion target by 2029.