MTN, Airtel Plan Cost Reduction In Network Sharing Deal

MTN Group and Airtel Africa have signed a network infrastructure-sharing agreement in Nigeria and Uganda, aiming to reduce costs and expand mobile connectivity in underserved areas.

Under the agreement, both companies will explore various models of network collaboration, including Radio Access Network sharing and fibre infrastructure partnerships. This could involve the construction of new fibre networks where necessary.

The telecom giants announced the deal on Wednesday, highlighting its role in optimising operational expenses and enhancing service delivery, particularly in rural regions where access to digital services remains limited.

MTN and Airtel, which control 51.79 per cent and 34.11 per cent of Nigeria’s telecom market, respectively, have both been impacted by foreign exchange losses due to the depreciation of the naira.

To mitigate FX exposure, both MTN and Airtel have reduced investments in network infrastructure. This slowdown is part of their strategy to minimise foreign exchange losses and manage rising operational costs, such as surging energy

MTN Group President and Chief Executive Officer Ralph Mupita said the demand for data services continues to grow across Africa, reinforcing the need for strategic investments.

“At MTN, we are driven by the vision of delivering digital solutions that drive Africa’s progress and will continue to see strong structural demand for digital and financial services across our markets.

“To meet this demand, we continue to invest in coverage and capacity to ensure high-quality connectivity for our customers. That said, there are opportunities within regulatory frameworks for sharing resources to drive higher efficiencies and improve returns,” he said in a statement.

Following the Nigeria and Uganda agreements, both operators are exploring similar infrastructure-sharing opportunities in other markets, including Congo-Brazzaville, Rwanda, and Zambia.

Airtel Africa Chief Executive Officer Sunil Taldar described the partnership as a practical approach to building a more extensive digital infrastructure while ensuring cost efficiency.

“As we compete fiercely in the market on the strength of our brand, services and offerings, we are building common infrastructure within the permissible regulatory framework.

“This provides a more robust and extensive digital highway to drive digital and financial inclusion while avoiding duplication of expensive infrastructure to drive operational efficiencies and benefits for our customers,” he said.

Airtel Africa serves over 156 million customers across 14 countries in sub-Saharan Africa, while MTN Group operates in 19 countries across Africa and the Middle East, with a customer base of 287 million.

Source:- Punchng