Is Telecel Fading Away?

The latest Q1 2025 Sector Performance Report from the Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ) paints a concerning picture for one of the nation's long-standing mobile network operators, Telecel.

As I looked at the drop in subscribers of Telecel, I began to think: when did I last call a Telecel number, or receive a call, or even just save a number from someone using Telecel? It really struck me that Telecel is fading slowly but surely. I checked my WhatsApp contact list and couldn't find anyone using Telecel. I asked my friends, and no one could remember calling someone with a Telecel number.

I remember the days when Telecel was a strong competitor, offering great bundles; I actually once owned a Telecel line. But now, its market presence is barely felt. While the overall mobile sector in Zimbabwe saw a modest increase in active subscriptions, Telecel experienced a significant decline across key metrics, raising questions about its future in an increasingly competitive market.

The Shrinking Subscriber Base

The report highlights that the total active mobile subscriptions in Zimbabwe grew by 1.38%, from 15,677,094 in Q4 2024 to 15,893,626 in Q1 2025. This general growth, however, masks a stark reality for Telecel. While its counterparts, Econet and NetOne, recorded subscriber increases of 2.17% and 0.38% respectively, Telecel's active subscriber base plummeted by a substantial 11.69%. This translates to a loss of 44,538 subscribers, with their numbers dropping from 381,097 in Q4 2024 to 336,559 in Q1 2025.

This decline has directly impacted Telecel's market share. Such a significant contraction in subscriber numbers is a critical indicator of a company's health in the telecommunications industry, suggesting a potential erosion of customer trust or an inability to compete effectively.

Dwindling Voice and Data Traffic

The challenges for Telecel extend beyond just subscriber numbers to its core services: voice and data. While the overall mobile voice traffic in Zimbabwe increased by 5.38% to 4.20 billion minutes, Telecel's voice traffic experienced a drastic decline of 43.28%. Their voice minutes dropped from 1,669,888 in Q4 2024 to 947,186 in Q1 2025. This sharp fall is particularly alarming, as voice services, despite the rise of data, still represent a significant portion of MNO revenue.

Similarly, in the burgeoning mobile internet/data traffic segment, Telecel continued its downward spiral. While the national mobile internet/data traffic surged by 17.31% to 114.02 Petabytes, Telecel's data traffic decreased by 18.26%. This contrasts sharply with Econet's impressive 20.68% growth and NetOne's 5.23% increase in data traffic. In an era where data consumption is the primary driver of growth in the telecom sector, Telecel's inability to capture or retain data users is a major red flag.

Implications for the Zimbabwean Consumer and Market

Telecel's struggles have several implications for the Zimbabwean telecommunications market and its consumers:

• Reduced Competition: A weakening Telecel could lead to a less competitive market, potentially resulting in a duopoly between Econet and NetOne. This might reduce incentives for innovation, competitive pricing, and diverse service offerings, ultimately impacting consumer choice and affordability.

• Service Quality Concerns: A declining subscriber base and revenue can hinder a network operator's ability to invest in infrastructure upgrades and maintenance. This could lead to a deterioration of service quality for existing Telecel subscribers, including network coverage, call quality, and internet speeds.

• Impact on Rural Areas: Telecel, like other operators, has a presence in various parts of the country, including some rural areas. A significant reduction in its operations could leave certain communities underserved or without viable mobile connectivity options.

• Potential for Market Consolidation: The continued decline could make Telecel an acquisition target or force it to significantly restructure its operations. This could lead to further consolidation in the market, with potential impacts on employment and the overall telecom ecosystem.

What Lies Ahead for Telecel?

The POTRAZ report clearly indicates that Telecel is facing significant headwinds. The consistent loss of subscribers, coupled with a sharp decline in both voice and data traffic, suggests a challenging path ahead. For Telecel to remain a viable player in the Zimbabwean market, it would likely need to undertake drastic measures, including significant investment in network infrastructure, innovative service offerings, and aggressive marketing strategies to regain customer confidence and market share.

The coming quarters will be crucial in determining whether Telecel can reverse its fortunes or if it will continue its trajectory towards becoming a marginal player in Zimbabwe's dynamic telecommunications landscape.