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Frehiwot said that Ethio Telecom did not give due attention to the international operation. “It was supposed to offer competitive prices. If you look at our tariff rate, it was adjusted in the beginning of 2013 and we did not make price revision in the last six years but the telecom sector is dynamic. Our termination rate was not also competitive. And Ethio Telecom was not properly following up the illegal telecom operation. It was only recently that we bought the monitoring system that enables us to trace the illegal telecom operation.”
However, chasing the illegal operators does not seem to be a lasting solution. Customers told The Reporter that the state telecom monopoly has to make tarrif revisions and offer competitive prices. Frehiwot accepts the comment. The CEO said her new management has conceded to the idea of becoming competitive. Accordingly, Ethio Telecom revised its termination rate recently and has seen a significant improvement in its earnings.
“We introduced a new rate effective November 2018 and we have seen encouraging results.” Ethio Telecom used to receive 500,000 minutes on average on a daily basis. After the termination rate adjustment, it is receiving 800,000 minutes. The amount of incoming international calls have increased by 40 percent after the termination rate adjustment. “We are planning to boost the revenue from international operation by 60 percent,” Frehiwot said.
The United States, Middle East, Europe and South Africa are parts of the world where majority of international calls to Ethiopia originate. Accordingly, Ethio Telecom has incorporated a new division dubbed International Business that works to grow the international business. The division head reports to the CEO. Ethio Telecom on Thursday announced that it has made a tarrif reduction on international calls raging from 10-40 percent. It also made 51 percent reduction on international SMS rate.
Frehiwot disclosed that Ethio Telecom has 800 million birr uncollected telecom service bills. Individuals, and corporate customers owe broad band internet, fixed line and mobile phone service arrears worth 800 million birr. “We are looking at the matter. We are investigating the cause of the problem,” she said.
In addition to the illegal telecom operation new telecommunication technologies such as What is up and Viber have significantly reduced Ethio Telcom’s revenue from international services.
In related news Ethio Telecom has started recycling 18 million mobile phone SIM cards as of yesterday. According to Frehiwot calls have not been made using these lines in the last two to seven years. “Mobile phone lines are scare resource that we have to use properly. We pay license fees for the lines. So have started recycling these utilised Sim cards.”
With regards to the planned partial privatisation of Ethio Telecom Frehiwot said that the pre privatization work is being carried out. Ministry of Finance and Economic Cooperation is the responsible government organ for the partial privatization Etho Telecom. “It is the Ministry of Finance who is coordinating the work but Ethio Telecom is actively engaging in the process. We believe that we need to have a strong a strong regulatory organ before privatising Ethio Telecom. We do not believe that there is a capable telecom regulatory organ. The regulatory organ should have the technology, know how, and finance required to properly regulate the sector,” Frehiwot said.