MTN Group and Airtel Africa have formalized a network infrastructure-sharing agreement in Nigeria and Uganda, with the aim of reducing operational costs and expanding mobile connectivity in underserved regions.
Under the terms of the agreement, both entities will explore various models of network collaboration, including Radio Access Network sharing and fiber infrastructure partnerships. This may involve the construction of new fiber networks where necessary.
The telecommunications giants announced the agreement this Wednesday, emphasizing its role in optimizing operational expenses and enhancing service delivery, particularly in rural areas where access to digital services remains limited.
MTN and Airtel, which collectively control 51.79 percent and 34.11 percent of Nigeria’s telecommunications market, respectively, have both been adversely affected by foreign exchange losses due to the depreciation of the naira.
To mitigate foreign exchange exposure, both MTN and Airtel have curtailed investments in network infrastructure. This slowdown forms part of their strategy to minimize foreign exchange losses and manage escalating operational costs, such as surging energy expenses.
MTN Group President and Chief Executive Officer Ralph Mupita affirmed that the demand for data services continues to expand across Africa, underscoring the necessity for strategic investments.
“At MTN, we are guided by the vision of delivering digital solutions that drive Africa’s progress and anticipate sustained robust structural demand for digital and financial services across our markets.
“To address this demand, we persist in investing in coverage and capacity to ensure high-quality connectivity for our clientele. Nevertheless, opportunities exist within regulatory frameworks for sharing resources to achieve enhanced efficiencies and improved returns,” he stated in a press release.
Following the agreements in Nigeria and Uganda, both operators are exploring similar infrastructure-sharing opportunities in other markets, including Congo-Brazzaville, Rwanda, and Zambia.
Airtel Africa Chief Executive Officer Sunil Taldar characterized the partnership as a pragmatic approach to constructing a more extensive digital infrastructure while ensuring cost efficiency.
“While we compete vigorously in the market based on the strength of our brand, services, and offerings, we are establishing common infrastructure within the permissible regulatory framework.
“This provides a more robust and extensive digital highway to facilitate digital and financial inclusion, while avoiding the 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.
