MTN Group President and CEO, Ralph Mupita has said that the company will bid again for the Ethiopian telecommunications license in the second round if mobile money services are included in the license.
“For us, it will really be important to see mobile money in that opportunity to put forward a bid and if it’s not there then probably we wouldn’t even bid,” Mupita told investors at the group’s capital markets day.
MTN lost the first bid to a Vodafone Consortium, which won the first license for a whopping US$850 million against MTN’s US$600 million.
Mobile money (MoMo) was excluded from the first licensing round and the Ethiopian Prime Minister Abiy Ahmed, said the block was imposed to allow the country to build its own expertise in phone-based financial technology.
But MoMo is critical to MTN’s strategy as it continues to evolve from just providing voice to also providing data, digital services, and mobile payment and lending solutions as demand for these services rise.
MTN is now pursuing a strategy dubbed Agenda 2025, which is designed to make it a fully digital platform player offering its network as a service for various innovations to plug in and play, and mobile finance is major in that strategy.
For instance, the MTN Groups projects that fintech service revenue contribution to its revenue will rise from 8% to 20% in 2025, and its mobile money customers across all of its operations will rise from 46.6 million to 100 million.
So Ralph Mupita made it clear to investors that if the Ethiopian license conditions in the second round remain the same, MTN might not bid any higher than the US$600 million it did in the first round.
“We really wanted to have seen mobile money in the license regime, so we adjusted our bid for the lack of mobile money,” Mupita said.
Meanwhile, last month, Ethiopia’s telecoms regulator announced that it had awarded one operating license to a consortium led by Safaricom, Vodafone and Japan’s Sumitomo.