Sam Nartey George, the Minister-Designate for Communications, Digital Technology, and Innovations, has levied a significant critique against the previous New Patriotic Party (NPP) government’s handling of MTN Ghana’s Significant Market Power (SMP) designation. During his appearance before Parliament’s Appointments Committee, he contended that the NPP administration wielded the SMP classification as a punitive instrument against MTN, rather than employing it as a corrective measure to address market imbalances. This punitive approach, he argued, has been demonstrably ineffective, as MTN’s market share has continued to expand despite the SMP designation. He pledged that under the Mahama administration, the SMP would be utilized as a tool to foster fair competition and ensure an equitable playing field for all telecommunications operators, benefiting consumers through a wider range of choices. This signifies a shift in policy perspective, prioritizing the creation of a balanced market environment over what George perceived as the previous government’s punitive stance towards a major investor.
The core of George’s argument rests on the distinction between punitive and corrective measures in regulating market dominance. He accuses the NPP government of misusing the SMP designation, ostensibly employing it to penalize MTN rather than to address the underlying market imbalance. This, he claims, is evidenced by the continued growth of MTN’s market share despite the SMP classification. In contrast, George outlined the Mahama administration’s intended approach, emphasizing the use of the SMP as a corrective tool to promote competition and consumer choice. This suggests a move away from targeting individual companies, instead focusing on creating a market structure that encourages competition and prevents dominance by any single player. The ultimate goal, according to George, is to foster a dynamic telecommunications landscape that offers consumers a diverse range of options and services.
The SMP designation, granted to MTN Ghana by the National Communications Authority (NCA) in 2020, empowered the regulator to implement corrective measures aimed at curbing the company’s market dominance. MTN’s control of over 57% of the voice market and more than 67% of the data market prompted the NCA to intervene, seeking to enhance competition and protect consumer interests. The Electronic Communications Act, 2008 (Act 775) provided the NCA with the authority to implement measures such as price controls, charge reviews, and ensuring equitable access to market information for all operators. These powers were intended to address the market imbalance created by MTN’s dominant position and prevent potential abuses of its market power.
Despite the NCA’s interventions and the SMP designation, MTN Ghana has maintained and even expanded its market dominance. The company’s third-quarter 2024 report revealed continued growth in key metrics: mobile subscribers increased by 10.8% to 28.6 million, active data users rose by 17.3% to 17 million, and Mobile Money (MoMo) active users grew by 18.1% to 17 million. These figures underscore the ineffectiveness of the previous government’s approach, as the SMP classification seemingly failed to curb MTN’s market share growth. This sustained dominance, according to George, reinforces the need for a more effective regulatory strategy focused on fostering competition rather than punitive measures.
The debate surrounding MTN’s SMP designation highlights the challenges of regulating dominant players in the telecommunications sector. Balancing the need to address market dominance with the imperative to encourage investment and innovation requires a nuanced approach. The NPP government’s strategy, as criticized by George, appears to have fallen short of achieving its intended outcome. The Mahama administration’s proposed approach, focusing on creating a level playing field for all operators, represents a different perspective on addressing this issue. Whether this approach will prove more effective in fostering competition and enhancing consumer choice remains to be seen.
The future of telecommunications regulation in Ghana hinges on the effective implementation of policies that promote both competition and innovation. The Mahama administration’s stated commitment to using the SMP as a corrective rather than a punitive tool suggests a potential shift in regulatory focus. This new approach seeks to address the underlying market imbalances and foster a more dynamic telecommunications landscape where consumers benefit from greater choice and operators compete on a more level playing field. The success of this approach will depend on the NCA’s ability to implement effective regulations and enforce them fairly, ensuring a balanced and competitive market that benefits both consumers and investors.
