MANAGEMENT at the state-owned mobile phone operator NetOne has blamed government for the company’s failure to effectively compete with industry rivals despite being the first firm to get an operator’s licence in the country.
NetOne Board Chairman, Dr Callistus Ndlovu told the media information and ICT parliamentary portfolio committee that government had over the years failed to inject funds into the company when asked why the firm was probably the country’s smallest mobile phone operator.
“NetOne has never received any capital infusion from the shareholder,” Dr Ndlovu said adding that it had also not been possible for the firm to operate like an “ordinary company”. He said NetOne had to "follow Government’s development agenda”.
The company, an off-shoot of the unbundling of the former Post and Telecommunications Corporation (PTC), was given a head-start by the government when it was granted the country’s first operator’s licence.
NetOne was able to launch its services while major rival Econet Zimbabwe Limited fought a lengthy court battle to be allowed to start operations.
Yet a little more than a decade later the company ranks well behind rivals Telecel and Econet in terms of subscriber numbers.
Dr Ndlovu told the parliamentary committee that the company’s lacklustre performance was largely due to the failure by government, which is the sole shareholder, to inject funds into the firm.
He also confirmed that talks were underway with foreign strategic partner over a possible joint venture arrangement expected to help recapitalise the company.
“After realising that the company cannot operate using the shareholders’ funds, we have been actively seeking strategic partnerships. We have had one or two partners expressing interest and now we are left with one,” Dr Ndlovu said.
Although he would not be drawn on details of the negotiations, NetOne has widely been linked to South Africa-based continental operator MTN.
Meanwhile the company's managing director, Reward Kangai said the firm was looking to treble its subscriber numbers by mid-year.
He said funds have since been secured to fund an expansion of network capacity and enable the company to take on more subscribers.
NetOne was recently reported to have sourced a US$53 million loan from China.
“From May (2010) onwards, we should be able to release more sim-cards. We already have the means to be able to increase our subscriber base substantially,” Kangai said. Additional reporting by New Ziana.