State-run Afghan Telecom will roll out 4G services in the war-torn nation by the end of this year as it looks to expand its share of a crowded market dominated by foreign players such as Etisalat.
"We will commercially launch our 4G network by the end of this year … we are not late … [we] took time because we wanted to cover majority of our existing as well as new customers," Mohammad Bashar Niazi, chief operations officer of Kabul-headquartered Afghan Telecom, told The National.
Almost all fixed-line services were destroyed during the war and most of the country's telecoms services now depend on wireless or mobile networks. Despite this, telecoms networks cover over 90 per cent of the population in Afghanistan.
Founded in 2005, Afghan Telecom is working with a mix of vendors including Huawei, ZTE and Cisco to launch its 4G services.
“Launch of 4G will be a major facilitator in our future growth,” said Mr Niazi.
However, Afghan Telecom will not be the first operator to offer 4G services in Afghanistan. Its main competitor, Afghan Wireless — the first wireless communications company in the country — rolled out a 4G network in 2017.
Afghan Telecom’s mobile business, called Salam, was one of the last players to enter the local market in 2013. Its main competitors are Roshan, Afghan Wireless, Etisalat and MTN Group.
With more than 2 million customers out of a total population of around 36 million in Afghanistan, Salam currently has a market share of nearly 11 per cent. The company is looking to grow this by a further 5 per cent.
“Wireless telephony is our stronghold and we will be increasing our market share in this segment to almost 16 per cent by 2020,” added Mr Niazi.
Afghan Telecom’s immediate priority is to invest in improving infrastructure and increasing connectivity, said Mr Niazi, without disclosing investment figures.
In the past, Afghan Telecom received a grant of $50 million (Dh183.5m) from the World Bank to expand its network bur Mr Niazi said the company is "self-sustainable" now.
“World Bank grant was mainly used to extend connectivity. But now we are a revenue-generating company and don’t need outside funding.”
Mobile money — payment services performed through a mobile device — could be a new growth engine for telecoms, according to Mr Niazi.
“Nearly 65 per cent of our population is young — below 30 — and they are using mobiles not only for calls but also for payments using internet,” he said. “We are working to build a safe framework of mobile money and very soon we will enter this business. Some private companies offered mobile money services in Afghanistan in the past but they were not very successful. There were many incidents of financial frauds.”
Afghanistan, which has nearly 19 million mobile users, is also pegged to experience an uptick in internet penetration as cheaper smartphones make their way into the country from neighbouring China.
"Currently internet penetration is around 19.6 per cent (7 million users) and with the availability of cheap smartphones, this figure will go up significantly,” added Mr Niazi.
Afghan Telecom is also sharing nearly 70 mobile towers with Etisalat, the UAE’s biggest telecoms service provider.
“It reduces opex [operating expense] and we are not competitors when it comes to sharing resources. There are 300 more towers to share with different operators,” he said.