- State-owned Ethio Telecom threatens legal action against Safaricom Ethiopia after line installations allegedly cause service blackouts.
- Dispute comes just two months after Safaricom launch in Ethiopia.
Ethio Telecom has threatened Safaricom Ethiopia with legal action after its customers experienced service disruptions in Semera, a city in the eastern region of Afar.
A statement released on Twitter asserted that that telecom line installations carried out by Safaricom Ethiopia had “severely damaged” Ethio Telecom’s communication lines passing through both the Afar region and Djibouti.
Service blackouts were reported on Sunday morning, although Ethio Telecom assured that “extensive repairs have been carried out” and that connectivity had been restored. However, the incident escalated further when the state-owned operator declared it would “be making legally accountable those who committed the act without prior notice”.
The dispute means that Safaricom comes under fire a mere two months after the full debut of its services in Ethiopia. It was reported in November that the new entrant had already amassed one million customers, meaning that an average of 20,000 customers had signed up per day since it commenced customer pilots in August 2022.
Disruptions caused by its line installations come during an expansionary period for Safaricom Ethiopia — it is aiming to add coverage in a total of 25 cities before April 2023, in order to pose a significant challenge to Ethio Telecom’s market control. The potential impact of legal proceedings on expansion plans could influence the success of such plans, with no response yet given by Safaricom on the matter.
Ethio Telecom is also in a state of transition. The conclusion of the Tigray War has led to the Ethiopian government championing a more laissez-faire approach towards the economy. The telecoms sector is seen as an area in which privatisation could drive growth for the nation, which has a mobile user base of approximately 65 million. In November, the government reinstated the process of selling a 40% stake in Ethio, as part of an aim to attract more international investment to the country. It also re-opened a stakeholder consultation process for a new full-service operating licence to allow a new competitor to enter the fray alongside Safaricom, which, according to State Minister of Finance Dr. Eyob Tekalign, will “create a world-class telecom industry and enhance the country’s digital economy”.
