24 May 2018
| Alan Burkitt-Gray
Ethiopia has started a partial liberalisation of its telecoms sector, but competition will be restricted to local companies and foreign firms will still be banned.
State-owned monopoly Ethio Telecom says it has signed deals
with eight companies to be virtual internet service providers
(VISPs). All VISPs will use Ethio Telecom’s
Abdurahim Ahmed, head of communications at the monopoly, told
the Reuters news agency: "Our objective of signing VISP
agreements is to increase subscriptions. There may be price
reductions. There will be competition among themselves
— that is the core idea." He said they would provide
"downstream services" only.
Ethio Telecom announced a few days ago that it has earned more
than $1 billion in revenue in the first three quarters of its
current financial year. More than 75% comes from mobile
services, it added.
But internet penetration is low. Ethiopia has a population of
100 million, with only 16 million interest users.
Ethio Telecom has 4G services in parts of the country, and an interconnect service with CMC
The eight VISP partners will offer different packages, Ahmed
told media in Addis Ababa, the capital. The only one identified
so far is the G2G group of IT companies, which offers internet
services under its G2G Clarity brand.
G2G has had a value-added service licence from the government
for two years, but now also has a VISP agreement with Ethio
Ahmed explicitly ruled out foreign companies from VISP deals
with Ethio Telecom – and the Ethiopian government has
held out against privatisation or wider competition, saying it
wants to use Ethio Telecom’s revenue to fund wider