Delving into Government’s Quest to Break MTN Ghana’s Monopoly and Its Implications
On Saturday, it emerged that Ghana will implement a set of policies to reduce the dominance of MTN Ghana in the country’s telecommunications market according to the Minister of Communications, Mrs. Ursula Owusu-Ekuful.
“The National Communications Authority (NCA) will in the coming days begin implementation of Specific policies to ensure a level playing field for all network operators within the telecommunications industry,” The statement said.
This statement comes after the Government describes MTN as having attained a Significant Market Power (SMP) per the NCA directives. MTN has over 70% of the industries market share,
What the government by this statement is telling us is that though they acknowledge MTN has made significant investments in their operations (infrastructure and human resources), MTN has so much power that consumers are forced to use MTN, not necessarily because they need MTN but because of MTN’s market share.
What is the Government’s problem here?
A set of rules called antitrust laws, ban companies from taking certain actions to develop monopolies. These laws ban deceptive trade practices that companies will try to use to gain an advantage.
But has MTN broken any rule?
An example of behavior against antitrust is lowering your prices to push out its competition. We all know MTN will never drop prices?
Another example is companies coming together to fix prices.
Still, we don’t see where MTN went wrong.
Well since none of the above applies, we can safely assume that the Government of Ghana is getting uncomfortable with MTN’s control of over 70% market share and are rightly so.
As at now, through no fault of theirs but sheer hard work, they wield so much power to control the industry’s path in both the short and long run.
So how is the government going to deal with MTN?
The government wants all the telcos to submit their plans within a month.
Now there you have it.
My two pence on this is that the government will stifle the growth of the Telecom sector. Though you can see a clear plan of improving coverage of telecommunication services, these directives won’t force the telcos to put in their best. Rather they would be doing their barest minimum to attain NCA requirement leaving much for optimization.
If the government wants to create a level playing field, NCA should reduce the price of the 4g spectrum, and allow the other options to undertake 5g drive before inviting MTN to the game.
Mind you, NCA’s decision to sell the 4g LTE spectrum at $64 million is what gave MTN a competitive edge, and they cannot absolve themselves of their complicity.