Airtel Dispels Rumours of African Market Exit, Says it’s Here to Stay

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After word went round last week that Airtel Africa, one of the largest telecommunications companies on the continent, was planning an exit from the market, the company has moved swiftly to dispel any such rumours.

In a statement, Airtel Africa CEO and Managing Director Raghunath Mandava, cites the company’s positive Q3 2016 results (its best quarter in over 2 years) and its planned 4G network rollout in several African countries as some of the things that show, respectively, the telecommunications company’s overall business outlook and commitment to the African market.

The company’s restructuring efforts and several other happenings over the last one year in the 15 African countries where Airtel currently operates in have led to widespread speculation that the company was preparing to exit the African market.

The company has in the last 2 years, sold off its operations in 2 African countries, Burkina Faso and Sierra Leone to French telecommunications company Orange with a further potential sale of its operations in the central African countries of Chad and Congo (Brazzaville) not being ruled out.

Bharti Airtel Africa which is part of the larger India-based Bharti Airtel Ltd, one of the biggest telecommunications firms in the world with over 364 million customers, has faced several huddles in the markets it operates in on the continent. In Kenya, for instance, its subsidiary has faced stiff competition from market leader Safaricom whose majority shareholder is British telecommunications giant Vodafone and whose revolutionary mobile money product, M-PESA, and its rollout of 4G across the country, have ensured it stays a leg up ahead of competitors.

Just recently, Airtel Kenya silently withdrew from the market its Unliminet product, a data product unveiled in early 2015 that was meant to woo Kenyans to the network through affordable and unlimited* social media-focused data plans as the company sought to tap into the growing mobile data market in the country. The company has yet to explain why the product was pulled but it’s anyone’s guess why that happened.

According to Airtel Africa, “data consumption and revenues have grown by 91% & 24% year over year respectively”, something it attributes to “stronger data networks”.

According to data from the telecommunications industry regulator in Kenya, the Communications Authority, Airtel Kenya had 6.7 million subscribers out of the 38.5 million mobile subscribers in the country recorded in the third quarter of 2016, a slight increase from the 6.5 million the previous quarter. Airtel accounts for just over 20% of Kenya’s mobile internet subscriptions, a figure it will be hoping to boost when it finally rolls out its 4G network. The company is set to start testing its 4G network in the country this week.

In Kenya, just like in Africa’s most populous nation, Nigeria, the local operations have been passed on from one company to another (Kencell-Celtel-Zain, in Kenya and ECONET Wireless-Vodacom-Vmobile-Celtel-Zain, in Nigeria) before landing in the hands of Bharti Airtel, a scenario that some believe has put the current owners in a catch 22 situation.

Should Bharti Airtel just pack its bags and exit the Kenyan (and African market at large) or should it stay put? This has been an ongoing discussion in our forums for a year now, long before the recent rumours abound. Jump in!

 

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