Mixed messages as MTN reveals it is not opposed to SPTC entering mobile market

30 Mar 2012

According to the Times of Swaziland, MTN Swaziland has said that it is not opposed to the Swaziland Post and Telecommunication Corporation (SPTC) entering the country’s mobile market, despite this week’s decision by the International Court of Arbitration in Geneva, Switzerland to ‘terminate forthwith the mobile component of any telephony network and service’ operated by the SPTC, which occupies the dual role of market regulator and fixed line incumbent. In a statement issued following the ruling, MTN said that the company and its stakeholders are not opposed to SPTC competing with them, but stressed that the regulator cannot do so while it is still an MTN shareholder. The precise status of the SPTC’s stake in MTN is shrouded in mystery; in 1Q11 the regulator claimed that it had transferred its 51% shareholding in MTN Swaziland to the Ministry of Finance (41%) and King Mswati III (10%), in order to pave the way for its own independent entry into the wireless sector.

After finding its repeated attempts at launching a rival mobile network under the ‘ONE’ brand blocked by MTN in 2010/11, the SPTC promptly changed tack and launched fixed-wireless services under the ‘Fixedfone’ banner in August 2011, offering limited mobility within each one of twelve designated zones: Big-Bend, Hlathikulu, Lavumisa, Luve, Mankayane, Manzini, Mbabane, Nhlangano, Pigg’s Peak, Simunye, Siphofaneni and Siteki. However, despite the considerable physical bulk of the Fixedfone handsets, it was reported that customers were driving them around in their cars and using them in different geographical regions to make use of the service’s cut-price calling tariffs; SPTC dismissed these occurrences as ‘anomalies’, claiming that the process of locking the Fixedfones to their designated zones was ongoing.

The International Court of Arbitration will reconvene in August for a second hearing to determine the amount of damages to be paid to MTN on account of the SPTC’s now-admitted breach of the two parties’ long-standing joint venture agreement.