Gov’t initiates moves to break MTN’s dominance in telecoms sector

The National Communications Authority is set to begin the implementation of specific measures within the telecommunications industry to provide a level-playing field for all network operators and break the dominance of MTN Ghana in the telecommunications sector.

This is according to the Ministry of Communications.

This is according to the Ministry of Communications.

A trend which MTN has shown over a three (3) year period and into the first quarter of 2020.

This it believes “clearly shows an uncompetitive and unprofitable environment for less dominant players in these industries” though the statistics are impressive and showing growth within the telecommunications and financial sectors.

Per the National Telecommunications Policy (NTP), “any operator with 40% or more market share in voice, data, SMS and value added services like Mobile Money, is considered a Significant Market Power (SMP). And MTN falls within that category.”

“With this designation of SMP, the Regulator is required to take corrective measures under the law to facilitate more market competition, ensure proper pricing for consumers and facilitate the overall growth of the telecommunications industry,” the statement explained.

To correct the imbalance, government is immediately putting in place an Asymmetrical Interconnect rate in favour of the disadvantaged operators.

It will also put a floor or ceiling pricing on all minutes, data, SMS, Mobile Money and review and approve all pricing by the SMP as required by law.

Additionally, it will require the SMP to not have differential prices for on-net and off-net transactions and ensure various operator vendors are not subject to exclusionary pricing or behaviour.

Citibusiness news

Government says the growing control of MTN “has impacted negatively on competition and consumer choice, necessitating corrective action” though it acknowledges the investments MTN has made in their operations over the years.

It has thus directed the National Communication Authority (NCA) to enforce the provisions of the Electronic Communications (EC) Act 2008 and the National Telecommunications Policy “to address glaring disparities in market share and revenue share in the sector.”

A statement issued by the Ministry explained that, “the policy directive is motivated by evidence of a growing market imbalance and creation of a near-monopoly in the telecom sector.”

It fears this imbalance will “potentially expose the country to the dictates of the dominant operator and negatively impact on competition and choice for the consumer as well as investments within the sector.”

Instead, it wants to guarantee “proper and healthy competition” in the sector in addition to securing better pricing policy for the consumers.

Government further indicates that per Industry Statistics released from the Statistical Bulletin – Quarter 4, 2019 of the National Communications Authority (NCA), MTN has almost 75% of telecommunications market share.