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Vodafone downplays 4G LTE rollout in Ghana

Vodafone downplays 4G LTE rollout in Ghana.

Vodafone says it is not rushing to roll out 4G LTE services in Ghana, citing the poor penetration of 4G-enabled gadgets and unfavorable market dynamics.

Vodafone Ghana CEO Yolanda Zoleka Cuba said despite the numerous advantages of LTE, the company views 4G as a long term venture since only 1% of the population have 4G-enabled devices.

Cuba said: "Over the long-term for us it is imperative to have access to 4G. It will actually ensure not just fast speed but network quality to all our customers, so from that perspective we are committed to 4G. But at this stage, however, when we look at the percentage of people with 4G-enabled phones, it's still around one percent of the Ghanaian population."

She noted that the low penetration makes it very difficult to justify the US$67.5 million 4G license fee required by the country's National Communications Authority (NCA) and requested during a 4G spectrum license auction held last year – the auction was won by MTN, who subsequently paid for the 4G license.

"If you are a market leader, you have dominance in the profit pool, not just the revenue pool ... it's much easier to say, in order to protect or entrench your lead, 'I'm willing to pay US$67.5 million'. If you're not, it's very difficult to justify that kind of investment. Do we need 4G spectrum, absolutely! But can we afford it? Unfortunately, not at this time," Cuba added.

Even though Vodafone aims to be the leading operator in Ghana, Cuba said it cannot compete with MTN in the space since the mobile operator had already started rolling out 4G LTE services in partnership with Ericsson.

She added: "As I talk to you, it would be easy to say we are going to get 4G next year - but absolutely not. What is going to happen is that we have to restructure our balance sheets to even consider being able to afford 4G."

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