Monthly News Roundup: August 2023

IHS Towers announced their Q2 2023 earnings, showing revenue growth of 16.8% year-on-year and an adjusted EBITDA of US$303.7mn, a 27% increase year-on-year, with total capex reaching US$207 million. IHS Towers’ board of directors has also authorised a stock repurchase program for up to US$50mn of the company’s ordinary shared effective from August 15^th 2023 through to August 15^th 2025.

CEO Sam Darwish commented on the results “We remain well positioned to take advantage of the strong secular growth trends across our markets, which we expect to continue for years to come. And we are encouraged by the recent policy changes implemented in Nigeria that are intended to put the country on a better economic path. In the near-term, however, these changes will cause some anticipated friction including the significant devaluation of the Nigerian Naira that occurred in mid-June. Subsequently, we are revising our 2023 guidance for revenue, Adjusted EBITDA and RLFCF while maintaining our capex guidance and our target leverage ratio. Our expectation for revenue would have otherwise increased by $31 million had the average FX rates previously assumed in our guidance remained unchanged, reflecting the strength we continue to see in our fundamental business.”

Airtel Kenya has announced plans to invest over US$150mn over the next three years to expand network coverage in the country. Kenya’s second largest MNO, Airtel will install an additional 659 network sites increasing the current total from 3,200 and covering 89% of the country. Airtel Kenya has also been rolling out new sites for its 5G network, which is now available in 16 counties and installed on 370 sites, with plans to set up 120 more in the next 3 months.

Airtel Uganda has begun plans to deploy 5G equipment at 50 sites across central Kampala with a roadmap of upgrading 2,500 sites with 5G down the line as well as launching a pilot in the Buganda region. Airtel and MTN both won 5G frequencies in the government’s auction in July with MTN launching services two days ahead of Airtel Uganda, with plans to upgrade all sites to 5G by 2024 with 100% indoor connectivity in Kampala.

South Africa’s Competition Commission (CompCom) has recommended the prohibiting of Vodacom to merge with MAZIV, the recently formed owner of fibrecos Vumatel and Dark Fibre Africa. Vodacom had sought to acquire 40% of MAZIVs shares in exchange for US$313.4mn in cash and ZAR.2bn in assets. The suggestion comes after concerns that the transaction is likely to lessen competition in several markets and no clear solution is being proposed to address the resulting harm in competition. The investigation also raised allegations of self-preferencing behaviour and discriminatory pricing by MAZIV and suggests the merger is likely to reinforce these activities.

Zimbabwe Electricity Supply Authority’s (ZESA) subsidiary PowerTel Communications is planning to invest over US$50mn to expand fibre infrastructure as well as improve connectivity in rural areas of the country. This project is being coordinated with improvements to ZESA’s electricity supply network and expansion of the energy grid.

Indian cellco Vodafone Idea (Vi) has completed 5G tests in the 3.3GHz and 26GHz bands in the city of Pune in Western India in a bid to meet its minimum rollout obligations, citing a notice from the Department of Telecommunications. Vi officials confirmed in a recent earnings call that the operator would not meet its rollout obligations in 15 of the 17 circles for which it purchased spectrum in August 2022. Rival operators Bharti Airtel and Reliance Jio Infocomm (Jio) announced earlier in August that they had met their respective requirements, while the fourth company to acquire spectrum in last year’s sale, Adani Data Networks, has yet to meet its obligations.

Indian vendor Tejas Networks confirmed that it received a purchase order from state-owned Bharat Sanchar Nigam Limited (BSNL) to supply equipment for the telco’s 4G/5G rollout. In a regulatory filing, Tejas reported that, with Tata Consultancy Services (TCS), it received a master contract for the supply, support and maintenance of RAN equipment for BSNL’s pan-India 4G/5G network. As part of the contract, Tejas received a purchase order valued at INR74.92 bn (USD899 mn) for the supply of 4G/5G RAN equipment for approximately 100,000 sites. The order would be executed in 2023 and 2024. BSNL’s deployment of 4G is more than a decade behind its competitors, with rival Bharti Airtel having launched its LTE network back in 2012. The cash-strapped telco initially struggled to secure spectrum for its rollout and, and then had arguments over the terms of its equipment tender. It was not until May 2023 that the company finalised negotiations with for its national 4G rollout.

Indonesia’s telco Telekomunikasi Selular (Telkomsel) and Swedish equipment manufacturer Ericsson have renewed their longstanding partnership to develop the operator’s 4G LTE and 5G network footprint in the country. Ericsson will deploy its energy-efficient 5G Radio Access Network (RAN) products in Aceh, Northern Sumatra, Central and West Sumatra and Eastern part of Kalimantan. Ericsson is powering Telkomsel’s network with its ultra-lightweight Massive MIMO antenna integrated radio AIR 3219 that will serve to address future 5G requirements.

Malaysian mobile network operator Maxis has become the last of the country’s major service providers to introduce 5G connectivity for end users, over the network operated by Digital Nasional Berhad (DNB). In July 2023, Maxis announced its intention to sign an agreement to access DNB’s 5G network, having long been the only one of Malaysia’s MNOs not to sign up with the wholesale operator. Maxis shareholders voted to approve the execution of the access agreement with DNB at an extraordinary meeting held on 14 August, and new tariffs were launched from 15 August, with 5G being offered for both pre-paid and post-paid users.

Axiata Group’s Nepalese unit Ncell Axiata has revealed that as part of the company’s service expansion and improvement drive in the last fiscal year 2022/23 it installed 338 new base transceiver stations (BTS) across the country. The mobile operator said the 4G LTE service expansion will benefit people living in 55 rural and remote areas in the high-altitude regions. Ncell also reported the deployment of 283 new BTS to enhance quality of service in more than 50 districts in other seven provinces. In the last fiscal year, the company also upgraded nearly 1,450 sites in over 60 districts, enhancing its 4G network capacity, with over 440 sites upgraded in rural municipalities. Ncell also upgraded the capacity of sites in metropolitan cities, boosting the total footprint to over 4,000 4G BTS across the country for the delivery of high-speed mobile internet and voice-over-LTE (VoLTE) services to nearly 16 million subscribers, providing population coverage of 91.4%.

The board of Thai state-owned fixed and mobile operator National Telecom (NT) approved the first phase of investment in a 26GHz 5G network rollout project, with an initial outlay of THB800 mn (USD22.6 mn). NT was formed by the merger of state-owned sister telcos TOT and CAT Telecom in January 2021. In Thailand’s February 2020 multi-band 5G spectrum auction, both won spectrum allocations, and in February 2023 the government approved NT’s 5G rollout plan and operational expenditure of THB6.7 bn for the period until licence expiry in 2036. NT aims of introduce 5G services in the 700MHz and the 26GHz bands by March 2024. NT’s management will conduct the procurement process by early next year. The telco has highlighted a focus on using the spectrum for fixed wireless services and private 5G campus networks for manufacturers, ports, logistics operators, airports and other enterprises.

Globe Telecom is partnering Hewlett Packard Enterprise as part of a joint initiative to roll out the country’s first private 5G Standalone (SA) network to help enterprises drive their digital transformation. The new network will deliver mobile connectivity as an alternative or complement to Wi-Fi and public mobile platforms, capable of handling Internet of Things deployments supporting mission-critical applications.

Globe Telecom published its financial results for the first half of 2023, highlighting sustained topline growth and service revenues of PHP80.40 bn (USD1.42 bn), up 2% from last year. The company attributed the growth to the significant expansion in data revenue across its mobile and corporate data businesses. Mobile revenues reached PHP54.82 bn, representing y-o-y growth of 1.0%, fuelled by demand for Globe’s pre-paid brands, despite its combined mobile subscription base declining to 82.9 million, down from 87.4 mn. The operator built 542 new sites and upgraded 5,087 sites to 4G LTE to meet the demand from data from its users and deployed 356 new 5G sites. Globe currently has 5.2 million active 5G mobile devices.

Vietnam’s Authority of Radio Frequency Management is completing preparations for an auction of mobile spectrum in the 700MHz band. The frequencies, which were freed up through the switchover from analogue to digital TV, will be used by mobile operators for the provision of 4G and 5G services. In preparation for this, in December 2019 the Ministry of Information and Communications published a circular on plans for the use of the 694MHz-806MHz frequency band for mobile services that came into effect on 16 February 2020. The development follows an unsuccessful auction of 2300MHz spectrum licences earlier this year which failed to attract any bidders.

E& has reported revenues of US$3.71bn in its Q2 financial results, up 4.8% YoY, driven by growth in all key markets. EBITDA however declines from 51% earlier this year to 48% driven primarily to inflationary pressures, the termination of Etisalat Misr (Egypt’s) national roaming agreement, and challenging macroeconomic environments that has led to currency devaluation. Despite this, net profit was up 3.8% and aggregate subscriptions increased from 160mn to 165mn in 12 months due to strong subscriber acquisition in Egypt, Pakistan, UAE, Chad, Burkina Faso, Afghanistan, Togo and Benin. Strong financial results will continue to fuel the group’s expansion-focused strategy, having recently agreed to acquire a controlling interest in four CEE MNOs from PFF Group.

MTN’s Iranian subsidiary MTN Irancell has announced it is working towards an initial public offering (IPO) which is expected to be concluded next year. MTN Irancell is 51% owned by Iranian Electronic Development Company (IEDC) and 49% by MTN Group and there was a requirement under Irancell’s concession that the owners should divest a 21% stake via an IPO within 3 years of its service launch back in 2006. So far the government has been unable to facilitate an IPO. MTN Irancell has invested over US$10bn in the country since launching.

Oman’s Telecommunications Regulatory Authority (TRA) plans to conduct a limited trail shutdown of 3G services ahead of an entire network switch-off which is due to take place in Q3 2024. The shutdown will start in rural areas and the spectrum repurposed for more advanced 4G and 5G networks. The TRA will also no longer approve devices that are not compatible with 4G networks and will prevent their distribution in the Sultanate, while ensuring VoLTE technology is enabled on all mobile devices.

Saudi towerco TAWAL has formally completed the purchase of United Group's 4,800 infrastructure assets in Bulgaria, Croatia, and Slovenia for EUR1,22bn after receiving all regulatory approvals.

The acquisition is the second big international expansion for TAWAL following its entry into Pakistan in 2022. Earlier in August, the Bulgarian Commission for the Protection of Competition (CRC) gave its approval to the sale of the 3,200 sites in the country to TAWAL which used to be on MNO Vivacom’s balance sheet.

According to TAWAL its European macro towers include 3,090 macro towers in Bulgaria, 1,020 macro towers in Croatia and 690 towers in Slovenia.

TAWAL has said it aims to ensure reliable, effective and efficient network to all MNOs and accelerate the deployment of ICT infrastructure in the three markets.

Christian Hillabrant has taken office as CEO of Vantage Towers, the towerco has announced. He succeeds CFO Thomas Reisten who had been an interim CEO following Vivek Badrinath's announcement earlier in 2023 he will not seek renewal of his contract as CEO when it expires at the end of the year.

Hillabrant was previously the Chief Operating Officer of U.S. towerco Tillman Infrastructure.

Digi Belgium, the joint venture between Romania-based multi-play service provider Digi and Belgian B2B telecom player Citymesh, will acquire 400 sites from Belgian MNO Proximus' national mobile network, Proximus has announced. The Proximus’ sites that will be decommissioned in the context of the ongoing consolidation will be transferred to InSky, the company that will be deploying the infrastructure of Digi and Citymesh.

" Creating a complete nationwide Digi network will take a few years, but thanks to this agreement, we can combine the strong Proximus coverage with the rollout of our own Digi network", Ward Van Ooteghem, Chief Strategy Officer at Citymesh Group has said. No financial details have been disclosed. Digi Belgium has also reached a national roaming agreement with Proximus which guarantees a 5-year access right to Proximus' national mobile network.

Digi entered the Belgium market in 2022 by setting up a joint venture with B2B telecom player Citymesh and acquiring 5G spectrum. The commercial launch for Belgium’s fourth MNO has been announced for 2024. It will offer services for both consumers and business clients.

DIGI Portugal is on-track with preparation for the launch of commercial MNO services in early 2024, its parent company and Romania-based multi-play service provider DIGI has announced in its H1 2023 financial results.

DIGI Portugal is working with Cellnex on the development of its mobile infrastructure and equipping contracted towers. The parties have an agreement for the roll-out of 2,000 PoPs (Points of Presence) by the end of 2023. The next rival of MEO, NOS and Vodafone Portugal has already acquired license to operate the low and mid 5G pioneer bands in the country.

Telefonica has reached an agreement to partner with SpaceX to market the latter’s Starlink services across its global markets. The deal will allow Telefonica to offer broadband satellite services to its customers in areas where it does not currently provide coverage. With Telefonica already marketing the service in Mexico, the partnership will extend to Peru, Colombia, Chile, Brazil and Spain.

Having secured spectrum in 2021’s 5G auction, ISP Brisanet has started marketing 5G services in the Northeast of the county. The ISP expects to cover 5 million people in 40 municipalities by the end of the year.

Colombia’s Ministry of Information Technologies and Communications has published a draft resolution of its 5G auction terms. Spectrum is set to be distributed in the 700MHz, 1900MHz, Extended AWS, 2500MHz and 3500MHz bands. Interested parties had until 15 August to submit their feedback

Mexico’s Instituto Federal de Telecomunicaciones (IFT) has approved the takeover of the administration of a 18.29% stake in ALTAN Redes by Macquarie. Mexico’s open access 4G mobile network operator exited bankruptcy protection in October last year, having been restructured as a public private partnership in which the Mexican government has a 80.43% stake.