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Econet dares rivals, cuts tariffs by 60 pc

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THE country’s largest telecoms firm, Econet Wireless has slashed the cost of calls to other networks by 60 percent, the deepest tariff cut ever introduced on the local market.
Econet said the new tariff was “unconditional” and would be “effective immediately on all packages and at all times of the day.”
In a statement, CEO Douglas Mboweni said that all Econet customers would now also enjoy Buddie Zone tariffing with discounts of up to 90 percent.
 “Econet will mount an extensive campaign to show that it not only has the cheapest tariffs but it also has the best value for money,” he said.
“Our tariffs are unconditional and we do not ask you to buy something extra or spend so much to get something. When we give, we give. We are not the largest operator by accident.
“Our customers know that the value that we give them in terms of coverage, network quality, services, products and tariffs cannot be matched.”
Mboweni rejected claims that his company was afraid of competition.
“We have the cheapest tariffs and it will remain that way. We have the best coverage and we will continue to broaden it. We also have the largest range of products and services and we will keep investing and introducing more,” he said.
Recently Econet recorded US$695 million turnover in the year to February 2013, up 14 percent from US$611 million recorded in prior comparable period.
However, the telecommunications group’s profit after tax went down 16 percent to US$139 million due to escalating operating costs.
The costs were driven up mainly by ballooning interest charges on a syndicated US$307 million loan and maintenance of backup electricity generators for base stations.
“Finance charges increased due to finalisation of the multi-creditor facilities in the year under review,” said Mboweni.
He added there was a slowdown in voice calls revenue despite the company’s subscriber base growing by 25 percent to eight million after it invested $147 million to upgrade the network.
“Certainly voice is still a key segment but this means that our initiatives in the non-voice category (data and overlays) simply have to be robust and solid in order to deal with the slowdown,” said Mboweni.
Total assets surpassed the US$1 billion mark, registering a growth of 25 percent from last year while the company’s debt to equity ratio improved to 54 percent from 65 percent in the period under review.Advertisement

Mboweni said the group’s mobile money transfer business, Ecocash, handled over $1,2 billion worth of transactions since its inception two years ago.