January 8, 2018 - MTN and VANU announced the integration of the two networks which will extend MTN's Network to Rwandans, in rural areas, who are currently unconnected.
The agreement will allow for the provision of GSM services, including voice and data, which were previously inaccessible to several people in rural Rwanda. The agreement will not only benefit existing MTN subscribers, but it creates an opportunity for MTN to grow its customer base.
Founded in 1998, Vanu provides solutions that make it possible for people in areas with traditionally poor or no coverage to connect with each other and the outside world. Vanu Rwanda (Local Vanu affiliate) was incorporated in Rwanda in March 2016.
Traditionally, developing mobile networks has required building high-power base stations, requiring significant financial investments. This makes it difficult to justify connecting rural areas, especially in developing economies like Rwanda. Revenue per site is lower due to lower incomes and sparse population, and costs of running the sites is higher due to the need to run diesel on off-grid sites.
To overcome the difficulties faced in providing mobile coverage to rural areas, Vanu pioneered a model that cost-effectively addresses these difficulties. The model brings together business and technical innovations of small-scale network architecture, wholesale network operation, and solar power, which ensure that mobile network operators like MTN can service people in rural areas.
The alliance between Vanu and MTN will close the digital divide by providing for services that were previously unavailable to the rural population. In addition to voice and data services, the alliance will allow for the provision of mobile money services through MTN Mobile Money which will unlock previously untapped economic opportunities. According to GSMA estimates, a 10% increase in mobile penetration results in a 0.8% increase in annual economic growth.
"We are thrilled to be working with MTN Rwanda, the largest telecoms operator in the country on a project which we believe will have a transformative impact on the lives of Rwandans," says Vanu-Rwanda CEO Anthony Masozera. "It shows that MTN is willing to work with companies, like Vanu, that have the potential to make a real difference in society."
MTN views the agreement as an enabler to better serve its customers, and as a crucial component of its business mission.
"We are committed to providing an improved rural service to all our subscribers," says MTN Rwanda's CEO, Mr. Bart Hofker, "The agreement with Vanu Rwanda underlines how passionately we feel that someone in a rural area should be able to receive the same level of connectivity as a city-dweller."
Masozera also acknowledged the Rwandan government's role in supporting Vanu's successful implementation of the project.
"The government recognised that connectivity is crucial to development and that our Rural Coverage as a Service model provides an innovative way to bring coverage to a sizeable population of Rwandans who live in rural areas," he says. "Government support during our pilot and testing phases laid the groundwork for agreements like the one we have with MTN today".
According to the Director General of RURA, Mr. Patrick Nyirishema,"The agreement between Vanu-Rwanda and MTN will help ensure all Rwandans are connected. This is in line with Rwanda's vision to achieve 100% network coverage, and ensure that by 2020 no Rwandan is left behind. The geography of our country means that doing so using traditional methods can be challenging. This service model enables the provision of world-class connectivity to our people wherever they happen to live in Rwanda."