By Decide Nhendo
Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ) has said the Zimbabwe Gold currency (ZiG) is impacting operation of telecommunications in Zimbabwe.
In his First Quarter Sector Performance Report, POTRAZ Director General Dr Gift Machengete said the new currency was impacting the performance of the telecommunications sector and said the only way for the tumult to settle was through improved macroeconomic stability.
“The introduction of the ZiG currency in Zimbabwe has implications for the telecommunications sector, impacting transactional processes, pricing strategies and cost structures. Going forward, the turbulence experienced by the sector in the first quarter is expected to subside on account of improved macroeconomic stability,” reads the report.
Machengete revealed that despite the sector being a highly capital-intensive sector with a lot of operating expenses it was lacking foreign currency for development to improve services.
“While the sector is highly capital intensive, it still faces inadequate foreign currency needed to invest in network expansion and upgrades. On the other hand, bandwidth costs, depreciation, administration costs, and staff costs remain key contributors to operating expenses in the sector,” reads part of the report.
The report expressed worry about the devastating El Nino-induced drought citing that it was going to affect the way consumers were going to consume telecommunications services since most of them were going to choose food first over data.
“On the demand side, the sector may suffer the negative spill-over effects of the El Nino induced drought which is likely to reduce aggregate demand. Hence, demand for telecommunications services may contract as consumers prioritize food against data,” reads the statement.
From the report, the first quarter of 2024 saw internet and data usage increase by 24.9 percent to reach 58.44 Petabytes (PB), from 46.79PB recorded in the fourth quarter of 2023. This was attributed to the increased expansion of digital services, remote working, and online learning, growing internet connectivity, and preference for Over-the-top (OTT) media and streaming services among other things.
Mobile voice traffic declined by 1.32 percent to record 3.07 billion minutes, from 3.1 billion minutes recorded in the previous quarter. Public Switched Telephone Network (PSTN) fixed voice traffic declined by 3.17 percent to record 66.87 million minutes from 69.06 million minutes recorded in the fourth quarter of 2024. The decline in mobile and fixed voice may be attributed to the substitution effect of Over the Top (OTT) communication such as WhatsApp and Facebook.
