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The ink had barely dried on MTN's South African operating licence in 1994 when a bold idea began to take root at the Pin Mill Farm headquarters: why not take this burgeoning success story beyond South Africa's borders and into the rest of the continent? The seed of this idea was sown in original shareholder Cable & Wireless’s interest in bidding for a licence in Zimbabwe, a move that would mark the beginning of MTN's expansion into African markets.
Enter a 32-year-old executive named Ross Macdonald who, while working for M-Net, had been closely involved in the South African licence bid and had been instrumental in developing the MTN financial model and business plan. Macdonald volunteered to put together a joint bid with Ericsson and Cable & Wireless for a Zimbabwean licence. The Zimbabwe exercise was to be short-lived. On the day of submission in Harare, and with numerous high-profile international players ready to pitch, the Zimbabwean authorities summarily and abruptly cancelled the tender.
The following year, in 1995, Macdonald was called into a board meeting and quizzed by directors on what he thought he was doing ‘running around Africa’. "I recall saying that I thought the South African market was finite and that if this business was going to maintain growth, we had to look for new markets. But considering that our customer base was already in the hundreds of thousands at the time, I suppose it was a fair question!"
It certainly was a fair question: across South Africa, cellular uptake had simply exploded, soaring much higher than had been predicted by anyone’s models, and MTNers were bending over backwards 24/7 to connect customers and keep them satisfied. And the country was still the only one in which MTN had a licence. Back in the mid-1990s, MTN’s vision for African expansion had two regional clusters at its heart: the Great Lakes region of East Africa and South Africa’s neighbours. That vision was to be expanded considerably as unforeseen opportunities in other corners of the continent presented themselves, and MTN became increasingly confident in its ability to deliver and grow almost anywhere.
In 1995 and 1996, the company was preparing to launch services in the mostly rural area of Transkei—the part of the Eastern Cape that, under apartheid, had become a notionally ‘independent’ homeland. Transkei was large, and its populations were rural, widespread, and mostly very poor.
There were concerns that Transkei would never pay a return on the considerable investment that went into connecting it. Those concerns were completely unfounded, however, and, to everyone’s amazement, for months after the switch-on in April 1996, Transkei carried some of the heaviest traffic recorded on the MTN network, most of it coming from community payphones. The Transkei success spurred dreams of expanding into Africa, where populations were similarly mostly rural and poor – and more than 70% of people had never made a phone call.
MTN’s first real opportunity to move into Africa came in 1996 when the Ugandan government called for tenders for a second mobile licence in partnership with its posts and telecoms service. MTN and its various consultants had just ten days to put together the tender, but they pulled it off—only for the Ugandan government to (as had happened in Zimbabwe) cancel it.
Two years later, in April 1998, the company was finally granted a Uganda licence, followed just weeks later by a licence in Rwanda. The great MTN African foray was underway. In Rwanda, Macdonald remembers visiting a government facility in 1996, two years after the genocide, that still bore the scars of conflict with bullet holes in the walls. Another memory is of a business associate taking ‘happy snaps’ around Kigali with the first digital camera Macdonald had ever seen. "Visiting Kigali in 1996 – two years after the genocide – was memorable, not least because the Rwandese are all incredibly bright, polite, and gentle people, and one could not imagine the horror that had taken place, but people were getting on with their lives. Life seemed so normal."
Shortly after winning the first two licences, Macdonald, formally appointed to go ‘running around Africa’ as Executive: International Business Development, brought on board Kym Walton, an all-round expert from Cable & Wireless, to formalise the necessary procedures and processes for further expansion. "We were no longer focused on becoming the biggest in South Africa," recalled Paul Edwards, at the time chairman of shareholder Johncom, "we wanted to become the biggest in Africa."
Ross Macdonald explained that MTN's philosophy in Africa was one of alliance-building with local and international partners, bringing together capital from Africa's entrepreneurs with funds from major Western operators. "We do not aim to move in and take over," he stressed, "but rather to supply our expertise as a platform on which locals can build, enhancing existing skills, developing new ones, and pumping money back into the community."
Getting networks up and running so far from ‘home’ was a daunting task, made possible by the deployment of expert MTN (and other expatriates) to Uganda and Rwanda and the rapid appointment of scores of talented, mostly young, locals. Getting started was relatively smooth in Rwanda, where MTN was able to deploy a containerised solution, a tactic that was to have a profound impact on the subsequent deployment of mobile networks across Africa.
"The arrival of giant Russian cargo planes bearing our first deliveries of network equipment was a momentous occasion," said Macdonald. "The ability to deploy whole components of a telecommunications network in a single delivery was significant. It had a marked impact on the deployment of subsequent mobile networks in Africa."
In Uganda, a giant multipurpose Unimog truck was bought and customised for transporting sensitive base station equipment over long distances on very rough roads. Equipped with a roof-mounted air-conditioning unit, a seven-ton crane, and a 12-ton winch, the MTN-branded Unimog had no fewer than 32 forward and 32 reverse gears. Growth in both Rwanda and Uganda was explosive – in terms of footprint as well as customers.
In Rwanda, helped by the steady arrival of giant cargo aircraft, the pace of network rollout probably surpassed the breakneck speed at which MTN had put together its network in South Africa. After signing the shareholders’ agreement in April 1998, the initial network was built in a matter of weeks, with the first MTN calls in the country being made on July 4. That date was Rwanda Liberation Day (‘Kwibohora’), commemorating the day the genocide and civil war ended in 1994, and was the date by which the company had promised to go live.
By February 1999, with sales going through the roof (especially following the launch of pre-paid on December 8, 1998), capacity in the capital Kigali had been increased, and two months later, coverage was extended to three additional towns. Less than a year after officially starting services in Rwanda, the country’s ten biggest towns all had full GSM coverage.
In Uganda, the network took slightly longer to go live, the big switch-flipping event being marked with a mobile call from President Yoweri Museveni on October 23, 1998, to his South African counterpart, President Nelson Mandela. Six weeks after the start of operations, MTN Uganda had signed up more customers than the opposition had in three-and-a-half years; such was the demand for all things MTN that there were even reports of Kenyans crossing the border just to make the Better Connection.
Less than two months after formally opening up for business, MTN had 60 outlets operating in and around Kampala, Jinga, Entebbe, and Iganga. One dealer had eight shops and had to employ 80 additional staff to cope. MTN's customer services department was recording up to 7,000 calls per day.
Meanwhile, over in Swaziland (today, Eswatini), MTN had worked similar wonders in getting its network switched on, in the case of the kingdom, nine months ahead of contractual obligations. On September 6, 1998, Independence Day and King Mswati III’s 30th birthday, the king made the country’s first cellular call (it’s not recorded who he phoned). Commercial operations began three months later.
Soon it became apparent that people in Swaziland’s urban areas were clamouring to buy MTN packages for their family members in the rural areas. "This is when you realise that MTN is much more than just a brand," said Themba Khumalo, CEO of MTN Swaziland and the first Swazi national to be chief executive of a multinational in the kingdom. "We uplift and help people every day."
In 1997, civil war erupted in Brazzaville, capital of the Republic of Congo, just across the great river from Kinshasa, capital of the Democratic Republic of Congo. As the fighting raged, MTNer David Rodman called his mother on the company’s satellite phone to reassure her that, despite what she might hear about the conflict, he was safely calling from Zaire. His mother’s response was: "Where is Zaire then?"
Just as close to the action that day was Rodman’s colleague, Ross Macdonald, who recalled "watching the civil war in Brazzaville from my hotel room in Kinshasa. This included MiGs bombing the city and tanks rolling through the streets. Then I saw the same images on CNN – because they were holed up in the same hotel – just one floor up."
MTN’s African forays were not without setbacks and failures. MTN bid for a licence in Kenya and lost by the narrowest of margins when Telia was not prepared to increase the subscriber forecast part of the bid. In the Democratic Republic of Congo, MTN got so far as to set up a local office but had its licence revoked when Laurent Kabila changed the rules because he fell out with his erstwhile Rwandan comrades.
With hindsight, Macdonald believes that turning down a licence in Botswana was a particular mistake. "We were assured of a licence, but we thought that the market could not support two licences, and so we walked away," he said. "In hindsight, it was foolish and arrogant of us."
Other ventures that did not come to fruition in the 1990s were in Tanzania, Ethiopia, Burundi, and Mozambique.
In 2004, looking back on a decade of involvement with the company, MTN’s stalwart chairman, Dr Nthato Motlana, recalled that his happiest moment in that time was signing the Rwanda licence agreement. "It marked the start of a new era for both MTN and Africa," he said. "It was a very special time. Africa's leapfrogging of the digital divide in the past 10 years has been amazing. Despite the struggles in the early years, MTN has had a lot to do with progress on the continent. Africa's future looks bright."
One of Macdonald’s most profound memories of his African adventures was when, after the Rwanda launch, he and Motlana spent some hours in the company of Paul Kagame, listening to him recount the horrors of the Rwandan genocide and the military campaign which he led to regain control of the country.
MTN's journey into Africa in the 1990s was marked by bold decisions, rapid growth, and a few setbacks. However, the company’s vision and determination have laid a strong foundation for the future. MTN’s commitment to connecting people, uplifting communities, and driving inclusive progress remains as strong as ever.
