‘MTN has liquidated Visafone, recognising a loss of N30.3 billion ($18 million) on the 2016 acquisition of Nigeria’s last-standing CDMA network. “Following the absorption by MTN Nigeria, Visafone is now fully liquidated,” a note in its H1 2024 financial statement said”’ – TechCabal.
Like Bourdex and Starcomms, Visafone was in the class of CDMA companies. But they quickly faded when GSM companies like MTN, Econet* and Glo took off. These CDMA companies had knocked down Nitel and its cobwebs of voice telephony, but they could not withstand the GSM firms. Of course, today, GSM firms in Africa are at the crosshairs of Elon Musk’s Starlink which provides satellite broadband services.
Meanwhile, do you see that 15 kobo/sec in the photo? Yes, that 15 kobo was very “expensive” and that should be late 1990s.
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The lesson of Visafone and CDMA cousins is an important one: the technology platform you adopt may even become the enabler of your failure. And that is why it is recommended that we seek professional opinions because some of those actions are not easily reversible.
This is a pure creative destruction in action. Creative destruction is a theory developed by Austrian-American economist Joseph Schumpeter in 1976 that describes how new innovations replace existing ones that have become obsolete. The term is often used to emphasize the dynamic nature of the modern economy and is generally viewed as a positive evolutionary process.
Schumpeter believed that capitalism is always changing and that new products and markets are constantly entering the sphere. He also believed that new ways of doing things are the main source of the capitalist economy’s development, and that old assumptions need to be broken so that new innovations can benefit from existing resources.
Creative destruction can lead to the destruction of existing economic structures, such as industries, firms, and jobs, but this destruction can also create long-term economic growth and progress.
For example, LASIK surgery has reduced visits to optometrists and opticians, but has increased the need for ophthalmologists. Similarly, the development of the internet led to the decline of the newspaper industry, and the rise of online shopping led to the decline of brick-and-mortar stores.
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