Telecoms & IT

Phone Home

TDM

Since its inception in 1981, TDM has undergone significant internal reform, becoming a public company in 1992 and a private Limited Liability Company in 2002. In this form, it is […]

Since its inception in 1981, TDM has undergone significant internal reform, becoming a public company in 1992 and a private Limited Liability Company in 2002. In this form, it is 80% state owned while the remaining 20% is held by the managers, technicians, and workers (GTT). It owns the dominant internet and mobile network service providers in Mozambique, and enjoys a monopoly in fixed-line services. The current chairman of TDM, Teodato Hunguana, was appointed in March 2011, and his tenure appears to have been successful to date, as after several successive years of losses the company enjoyed a profit of $26.3 million in 2011, with the business growing by 12%. These profits are regarded as the result of the expansion of TDM’s services throughout the country, and the result of fees paid by international fiber-optic cable operators whose infrastructure crosses Mozambican territory. The board has also concentrated on reducing costs, and has frozen the salaries of the senior staff. The investment made by the company in 2011 amounted to $44 million, a 335% increase on its 2010 investment.

The telecommunications sector in Mozambique has undergone significant reform over the past decade, both in terms of competition and service offering. The SEACOMM and EASSy fiber-optic cables arrived in 2009 and 2010 respectively, dramatically reducing the cost of bandwidth and thus broadband retail prices, and improving the speed and reliability of connections, which had previously depended on satellites. In 2011, fixed-broadband internet subscribers represented only 0.07% of the population. Internet usage, however, has increased rapidly among Mozambicans, with 4.3% of the population accessing the web in 2011 compared to only 1.6% in 2008. Total investment in the telecommunications market has increased by an even greater extent, with $80 million in 2010, followed by £508.4 million in 2011. TDM’s subsidiary, TVCABO, is the largest of the 20 or so internet service providers currently operating in the country.

The mobile network in Mozambique is split between three companies. In the 1990s, TDM operated a monopoly, but following market liberalization in 2002, Vodacom, a subsidiary company of Vodafone, entered the market in late 2003. TDM’s subsidiary company, mCel, was founded in 1997 and remains the dominant network. Vodacom is mCel’s strongest competitor. The greatest impact to the market in recent years has been the granting of a third license and the subsequent market entry of Movitel in 2010. This newest competitor is 70% owned by Viettel Telecom, a Vietnamese network, and 30% by Mozambique’s ruling party’s investment branch, SPI-Gestão e Investimentos of the Frelimo party. It has pledged to invest $465 million in Mozambique to establish itself as a nationwide network and aimed to have laid 16,000 kilometers of fiber-optic cables and built 1,850 mobile base stations by the end of 2012. This would double the total number of mobile base stations in Mozambique. Movitel plans to achieve its plans through strategic partnerships. In May 2011, Movitel signed an agreement with the state electricity company Electricidade de Mozambique (EDM), which allows it to run fiber-optic cables alongside EDM’s electricity wires on the national grid.

TDM remains the most significant telecoms provider in Mozambique. Its internet service offering through TVCABO is developing rapidly and becoming dramatically cheaper. While it currently has an almost unrivalled dominance of the sector, it will be interesting to see the effect of greater competition in the near future. With Movitel’s investment in rural Mozambique, the state provider has significant ground to catch up if it is to retain its position.

You may also be interested in...

Female,Scuba,Diver,Swimming,Under,Water

Tourism

Diving in

Scuba diving in Mozambique

View More
Large,Industrial,Tanks,Or,Spherical,Tanks,For,Filter,Of,Petrochemical

Real Estate & Construction

Chin up

Challenges for the future

View More
Cocoa,Pods,In,Ghana,Forest

Agriculture

On the right track

Reforming the agricultural sector

View More
Casablanca,,Morocco,Industrial,Shipping,Port,At,Dawn.

Transport

The port of choice

The Port of Nacala

View More
The road to prosperity

Telecoms & IT

The road to prosperity

Internet access

View More
Come get involved

Finance

Come get involved

Financial inclusion

View More
Beer battles

Industry

Beer battles

Breweries in Mozambique

View More
A united front

Diplomacy

A united front

Cabo Delgado insurgency

View More
Between a rock and a hard place

Economy

Between a rock and a hard place

Mozambique versus COVID-19

View More
View All Articles