Safaricom, the telecommunications giant, has achieved a milestone by surpassing five million subscribers in its Ethiopian subsidiary within less than a year since entering the competitive Ethiopian market. The company’s objective is to secure a significant market share and aims to acquire 10 million customers by the end of March next year, according to MarketNewsNG.
Stephen Kiptinness, Safaricom’s chief corporate affairs officer, confirmed the impressive subscriber numbers. He responded affirmatively to a query seeking official validation of the subsidiary’s performance.
Safaricom’s entry into Ethiopia in October of the previous year marked a strong beginning, gaining 740,000 subscribers within the first month and generating revenue of Sh98.3 million. The company announced crossing the one million customer milestone in mid-November and by mid-March of the current year, it reached 2.8 million customers. This recent accomplishment signifies an addition of 2.2 million users in just five months, with an average of 14,600 daily sign-ups.
As Safaricom competes with the State-owned Ethio Telecom (Ethiotel) for dominance in the 112 million-strong Ethiopian market, it has also initiated M-Pesa operations in the country. The company aims to attract at least two million M-Pesa customers by the end of the current financial year.
Despite aggressive marketing and substantial investments in infrastructure and services, the Ethiopian venture has faced challenges, with the subsidiary generating revenue of Sh1.83 billion but incurring significant operating costs, leading to a loss after tax.
Safaricom’s strategy is to offer quality telecommunications and mobile money services to increase its customer base in the Ethiopian market and replicate the success it achieved in Kenya. The company also plans to invest between Sh40 billion and Sh45 billion in its Ethiopian operations in the current financial year.