The Tanzania Telecommunication Company Ltd (TTCL) will enter the mobile phone sector by the end of this year, and compete directly for more than 30 million subscribers.

The state corporation will move from Code Division Multiple Access (CDMA) to Global System for Mobile (GSM) services. GSM is the most widely used digital wireless telephone system in the world.

The transfer from DCMA to GSM will enable the TTCL Sim card to be used in all types of mobile phone handsets. Currently the Tanzania mobile companies that use GSM are Airtel, Vodacom, Zantel, Tigo and Smart.

TTCL head of business unity Fredrick Mloka said that by 2020 the firm aims to have 2.5 million to 3.4 million subscribers, about 10 per cent of the market. The company currently has 260,000 subscribers on its landline and mobile services.

Mr Mloka said they will introduce a mobile money transfer product called TTCL Pesa. He said TTCL is moving from CDMA to GSM via Long Term Evolutions (LTE).

“We expect to get a positive growth by the second year,” he said.

Mr Mloka said by moving to fibre optic, their customers will have reliable services and the company will deliver these countrywide.

TTCL needs $180 million from the government, internal sources and development partners to finalise the project. So far it has spent $22million to purchase equipment for the transformation.

“We are optimistic that we will get the required funds to complete the entire project because the government has promised to inject some of the required funds,” Mr Mloka said.

However, analysts caution that TTCL’s ambitious plan will require radical changes in its traditional way of doing business. “TTCL can shake the market especially if it involves experts in its strategy,” development analyst Emmanuel Kisumo said.

Government-owned

Mr Mloka said the government has concluded negotiations with Bharti Airtel on the transfer of 35 per cent shares. The Tanzania negotiation team reached an agreement with Bharti Airtel to pay Tsh14 billion ($7.8 million) for TTCL to become wholly state owned.

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According to Deputy Minister for Communication, Science and Technology January Makamba, in 2010 TTCL generated about Tsh80 billion ($42 million), and in 2013 the company’s revenue rose to Tsh93 billion 93 ($49 million).

“The company also managed to cut down losses from Tsh28 billion ($14 million) recorded in 2010, to Tsh 16 billion ($8 million) in 2013,” said Mr Makamba.

Tanzania is the second largest telecoms market in East Africa, behind Kenya. The driver of this phenomenal growth has been the mobile sector.