How MTN lost the lucrative Rain deal

In November 2016, WBS (now known as Rain) announced that it had signed a facilities leasing and roaming agreement with Vodacom.

This multi-billion-rand deal is helping Rain to accelerate its LTE-A network rollout and gives Vodacom access to additional spectrum to serve the growing demand for data on its network.

While Vodacom and Rain are now close partners, it could have been very different if former MTN SA CEO, and now Altron CEO, Mteto Nyati had his way.

In his book Betting on a Darkie, Nyati explained how former FNB CEO Michael Jordaan and FirstRand’s Paul Harris approached MTN regarding a partnership.

Rain needed an existing mobile operator as a partner to realise its vision of offering affordable data to people in urban areas.

“To work out the finer details of pricing, I handed the proposal to MTN SA’s chief financial officer, which in hindsight was a mistake,” Nyati said.

He explained how inaction from MTN SA’s CFO resulted in Jordaan and Harris walking away from MTN and signing a deal with Vodacom.

“I was disappointed. It was a critical project that could’ve changed the structure of the market. I kicked myself for not having led the discussion myself,” said Nyati.

Rain still open to new agreements

In response to questions from MyBroadband, Rain CEO Willem Roos said it spoke to various parties before it signed the agreement with Vodacom.

Roos added that Rain remains open to conclude a roaming agreement with any party that makes sound business sense for all.

Roos could, however, not divulge details about Rain’s discussions with MTN due to the confidential nature of these negotiations.

MTN signs deal with Liquid Telecom

In February 2019, MTN signed a deal to roam on Liquid Telecom’s 4G network “to provide greater Internet access across South Africa”.

This deal mirrors the Vodacom-Rain agreement with infrastructure sharing, which reduces the need for excessively high capital investment.

As was the case with Rain and Vodacom, the deal with MTN enables Liquid Telecom to make the most of its spectrum assets.

Mteto Nyati’s best-selling book Betting on a Darkie is available at bookstores countrywide.

Now read: Vodacom’s R1.7-billion plan with WBS

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How MTN lost the lucrative Rain deal