Balancing Act News Update - African internet developments

Balancing Act home page

Current issue

Full archive

Submissions

Subscribe

Order publications

About

Contact us

Search site

Amend subscription

En français



The countries below contain a historic archive of information on the state of the internet that is now three years old. For some countries, the information has remained largely the same whereas for others considerable change has occurred. However it can still be used to identify organisations involved in developing the internet and to understand the historic development of the Internet in Africa. For up-to-date (but "pay-for") information click here: There are special rates for students and universities.

DOWNLOADS ZONE
This is an area where you can download longer articles and reports of interest. These will be updated as new material becomes available.

Download 1
(Word format, 875kb)
This IDRC-supported research study looks at how complaints by African consumers in the telecoms and Internet sectors are dealt with and what input consumer organisations are able to make into policy for these sectors. It is based on a survey of 30 African countries and includes detailed case studies of Kenya, Senegal and South Africa.

Download 2 Word document
(255kb)
This chapter from the ITU's Global Trends in Telecommunications Reform 2005 examines the market and regulatory implications of the shift to IP networks and outlines the different types of responses regulators are making to VoIP calling.

Download 3
(pdf format, 310kb)
Leslie Chan, Barbara Kirsop, Subbiah Arunachalam look at the use of Open Access archiving as a way of improving scientific capacity building.

If you have updates or interesting material to add, please send it to info@balancingact-africa.com

ALGERIA ANGOLA BENIN BOTSWANA BURKINA FASO BURUNDI CAMEROON CAPE VERDE CENTRAL AFRICAN REPUBLIC CHAD COMOROS CONGO COTE D'IVOIRE DEMOCRATIC REPUBLIC OF CONGO DJIBOUTI EGYPT EQUATORIAL GUINEA ERITREA ETHIOPIA GABON GAMBIA GHANA GUINEA GUINEA-BISSAU KENYA LESOTHO LIBERIA LIBYAN ARAB JAMAHIRIYA MADAGASCAR MALAWI MALI MAURITANIA MAURITIUS MOROCCO MOZAMBIQUE NAMIBIA NIGER NIGERIA REUNION RWANDA SAO TOME & PRINCIPE SENEGAL SEYCHELLES SIERRA LEONE SOMALIA SOUTH AFRICA SUDAN SWAZILAND TOGO TUNISIA UGANDA UNITED REP OF TANZANIA ZAMBIA ZIMBABWE

NIGERIA: THE BEGINNING OF THE END FOR AFRICA’S INTERNATIONAL GREY MARKET?

Telecoms news

Internet news

Computing news

Digital toolbox/In search of the business model

On the money

Web news

People, events, jobs, contracts...

Parts 1, 2 and 3 of African Internet Country Market Profiles are out now... and web ordering now in place..

The first part of Balancing Act's African Internet Country Market Profiles covers 22 countries in West Africa, the second part covers 15 countries and territories in East Africa and the third covers 12 countries in Southern and Central Africa.

To see the contents:
Part1: http://www.balancingact-africa.com/profile1.html
Part2: http://www.balancingact-africa.com/profile2.html
Part3: http://www.balancingact-africa.com/profile3.html
To order: http://www.balancingact-africa.com/publications.html
You can now order by credit card direct from this web site.

WEEKLY PUBLICATION DEADLINE: 12 pm GMT Sunday.

For country-by-country information on internet, telecoms and computing in English go to: http://www.afridigital.net

L’edition mensuelle en francais: L’edition mensuelle en francais de Balancing Act’s News Update donne des informations sur les derniers developpements en matiere de Telecoms, Internet et Informatique en Afrique. Si vous voulez vous abonner a News Update, envoyez simplement un message en francais "Je veux m’abonner à l’édition en français de Balancing Act’s News Update" a info@balancingact-africa.com. Si vous voulez annuler votre abonnement, il suffit d’envoyer un message en francais "Je veux annuler mon abonenment à l’édition en français de Balancing Act’s News Update" a la meme adresse email.

2006 RATE CARD AVAILABLE
To see a copy of our rate card for 2006, e-mail a request to: (info@balancingact-africa.com) Don't get left behind. Be seen and known through advertising in our e-letter and on our web-site.

ISSUE NO 321

Nigeria: the beginning of the end for Africa’s international grey market?

With the new Nigerian telcos offering some of the cheapest prices on the continent for international calls, the VoIP grey market in Nigeria is in a tail-spin. This may turn out to be the beginning of the end for the price arbitrage-based grey market on the continent. However before telco incumbents across the continent break open the champagne to celebrate, they need first to see the painfully low prices that have brought on this decline. Back from a recent trip to Nigeria, Russell Southwood looks at this and other trends that are emerging in this developing market.

All the telcos (including Nitel) are sending out international traffic using IP, the only difference is whether they pass on the savings made to their customers. Incumbent Nitel is currently charging N45 (US36 cents) a minute for a call to Washington DC. By contrast, one of the newer telcos Starcomms is offering the same call for N20 (US16 cents a minute). The mobile operators have replaced the fixed line operators as the new incumbents with MTN charging over N100 (US80 cents) a minute for international calls and VMobile, shortly transforming itself into Celtel, charging N60 (US48 cents) a minute. The mobile operators all have IP gateways. For example, MTN is operating IP gateways in Lagos and Abuja so it is not clear why they are charging so much more than anyone else. If the precedent set by the Safaricom IP service in Kenya is anything to go by, they will shortly be following the others with lower prices.

The impact of these falling prices has been to completely undercut the grey market. Most are small operators – like cyber-cafes or ISPs – who buy from international minutes aggregators. And the prices have now reached the point where there is little or no margin left for them to make a living.

As most are small-scale operators, they do not have the volumes needed to make sufficient income. One bandwidth seller told us:”We used to have a couple of pre-paid card wholesalers in one of Nigeria’s larger regional cities. Both have gone out of business.”

This loss of grey-market voice business seems to have been only one of several plagues to have hit the Nigerian cyber-café business. The tightening up of security scrutiny of cyber-cafes to weed out 419 scammers has also deterred legitimate customers. The net result has been catastrophic as one industry insider told us:”There has been a significant churn amongst cyber-cafes. New ones open and old ones close with a failure rate as high as 60%.”

You might have thought that all this cheaper, international IP-based voice traffic was coming about because operators were switching to cheaper SAT3 fibre prices. How wrong you would be. Those buying satellite bandwidth in the Nigerian market in volume can get below $5,000 per mbps per month duplex, a price than is still cheaper than SAT3 fibre prices. Indeed one of the Nigerian satellite bandwidth resellers told a workshop at the recent 3rd African VoIP Forum that on the basis of their research, SAT3 prices were still on average $2,000 per mbps per month higher than their satellite equivalent.

(Nevertheless we were told that a staggering 30% of Nigerian satellite reseller market consists of small, largely faceless, unlicensed operators.)

It is part of the tragedy of this story that incumbent Nitel is only now really focusing on beginning to sell SAT3 capacity as part of its roll-out of broadband. This is a full five years after it had the capacity available at its landing station and five years of lost fibre capacity that it will never get back. There are not many African telcos that can have thrown away quite so much money by not using this time-sensitive asset. The incumbent now has plans to make broadband available through ten exchanges and offer up to 500,000 new lines.

But the full awfulness of the story does not end there. Even those who have already connected are not being offered a reliable service. As another industry insider told us:” The service is hardly stable. There’s problems of motivation (amongst its engineers). People are disgruntled (by the recent privatisation).” The company has no redundancy fibre connection to the nearby landing station in the neighbouring country of Benin.

So when the fibre goes down, customers just have to wait until Nitel gets round to fixing it. So it’s hardly surprising that large corporate customers - like Shell, Total and Tara – that have gone over to fibre have hung on to their satellite capacity to use it for redundancy when there are SAT outages.

Interestingly, a SAT3 wholesale market is beginning to develop. One of the problems has been that the old-fashioned incumbents responsible for selling the fibre will not sell anything smaller than an E1. Until recently, they have been unwilling to sell the capacity on in bulk to resellers. However you can now buy SAT3 capacity from at least three Nigerian companies (21st Century, Accelon and GS Telecom) all of whom have until recently been better known for selling satellite capacity. With one 5-10 millisecond hop, your traffic goes into their local hub before being transferred via Nitel to the landing station. Expect to see more of this kind of reselling elsewhere in the future.

ISSUE NO 321 TELECOMS NEWS

INDEX

NEOTEL GIVES TELKOM SA TASTE OF COMPETITION

Almost a dozen companies are already using the services of Neotel, the new second network operator that officially launched yesterday as a rival to Telkom. Neotel will pump R11bn into its networks over the next decade, with the bulk of the spending happening in the next cash-guzzling two or three years.

Cell C was the first customer to place a call over the new network, said Neotel CEO Ajay Pandey. Vodacom and MTN are also routing some of their international calls over Neotel's bandwidth. Even Telkom is a customer, with the two networks poised to be occasional collaborators as well as rivals.

At the long-awaited launch in Midrand, Pandey paraded the first customers on stage, saying Neotel would be nothing without its clients. It will need many more to recoup its current and future investments, however, and Pandey said no profit will be seen for at least three or four years.

Its first services are to transmit international traffic for other telecommunications players that offer voice and data services to corporate SA. Until now Telkom has monopolised the supply of that international bandwidth.

Large companies will be its second target, by offering international and national bandwidth directly to big companies by the end of the year. Consumers will have to wait until an unspecified time next year before they can buy fixed-line calls or Internet access directly from the second network operator. The first few consumers in major urban areas should be reached by March next year, with a goal of eventually reaching 80% of the population.

Neotel is negotiating with local banks to raise its funding in a combination of debt and equity. The cash will be used to expand the national networks built by Transtel and Eskom Enterprises, which together hold 30% in the business. Its other stakeholders are the Indian conglomerate Tata and its telecoms subsidiary, VSNL, with 26%; Nexus Connexion, the black empowerment partner, with 19%; and Two Telecoms and CommuniTel, each with 12,5%.

Pandey said Neotel aimed to change people's perceptions of telecommunications services and become their preferred supplier. By delivering what the industry needed it would open up new opportunities for local companies, particularly those running call centres and business process outsourcing services for foreign customers, he said.

At the moment, Neotel's national network was inadequate to offer all the services it would eventually supply.Cash would be pumped in to rapidly grow its infrastructure, with more than half the R11bn spent within three years.

(SOURCE: Business Day)

NEW MOBILE PHONE ENTRANT FOR MOZAMBIQUE HANGS ON FEASIBILITY STUDY

A new mobile phone operator could soon establish itself in Mozambique, said Transports and Communications Minister, Antonio Munguambe last week, reports "Noticias".

Currently, there are two mobile phone operators established in the country, namely, the Mozambican Mcel and the South African Vodacom.

Munguambe, who didn't disclose the name nor the dates for the establishment of the new operator, said that "all depends on the feasibility studies, to be carried out soon, in order to assess the situation of the domestic market". Munguambe added that "there is a huge interest from the new operator in the Mozambican market, adding that this should happen in the shortest space of time".

However, said the minister, a favourable decision from the Mozambican government regarding the establishment of any new mobile operator will be mainly determined by the feasibility studies to be conducted on the Mozambican market. "We want to gather more information to assess weather there is room in our market for another mobile phone operator, in order to decide objectively if we can accommodate a new operator", explained Munguambe.

According to him, for a new company to start operating in Mozambique in this area it has to challenge the market and improvement of the quality currently rendered to the users and not to destabilize the existing mobile phone operators.

He said that currently not only "Vodacom" is complaining about the legislation in the telecommunication sector but also the state owned company "Telecommunicacoes de Mozambique" (TDM) and the mobile phone operator "Mcel". "That's one of the reasons the government has appealed to the regulator to propose measures to establish an even treatment among the operators, which soon will turn into reality, because we have set deadlines for its completion", said Munguambe.

(SOURCE: Agencia de Informacao de Mocambique)

MASCOM DENIES DECEIVING ORANGE SUBSCRIBERS IN BOTSWANA

Mobile phone service provider, Mascom has refuted allegations that it is trying to lure Orange customers by giving misleading information about its rival. Company spokesperson, Odirile Motlhale said Mascom has not been involved in any unlawful business practice concerning Orange's existence in order to lure their customers and increase its subscription base. He was responding to a press release published in local newspapers purported to have targeted Orange subscribers. The statement indicated that, "a certain company offering mobile services is providing and/or is involved in the perpetuation of misleading information about the long-term existence of Orange in Botswana".

Kago Mmopi, Orange Botswana Marketing Manager confirmed that indeed a company offering mobile services is providing such misleading information in order to lure Orange subscribers to switch subscription to the company in question. However, Motlhale said that if the alleged mobile operator that Orange is referring to happens to be Mascom, then they would have to wait to hear from their regulator which is Botswana Telecommunications Authority, (BTA).

"Unfortunately, I cannot answer a press release which is not specific like that one and we will all hear from the regulators if it does concern us," an unfazed Motlhale said. According to Mmopi, Orange subscribers have been asked to surrender their SIM cards with promises of receiving a SIM card from another mobile service provider at no cost.

Only these two companies currently operate the mobile service provision in Botswana. Despite this fact, Mmopi vehemently refused to reveal the name of the mobile operator and said that it could be the vendors, who are selling scratch cards, SIM cards and phones on behalf of their competitor, who are trying to lure the subscribers. The press statement further states in part: "Be advised that appropriate action has been initiated with the regulatory body to protect our most valuable asset, you".

Mmopi explained that they have lodged a complaint with BTA and expect a response shortly. For his part, BTA spokesperson, Aaron Nyelesi was in the dark when asked about the issue and said he was not aware of a complaint lodged by Orange.

Nyelesi said that he also learnt about Orange's complaints from the media and would have to check with the other BTA departments to find out if they had received a letter from them. Statistically, Mascom continues to be the leading service mobile provider, having grown by over 120 percent since December 2001. Its customer base has increased from 219,000 subscribers to an expected 600,000 by the end of 2006. Mascom controls 70 percent of the mobile service share. With an investment portfolio of over P420 million, with more than 20 base stations using 1800 MHz, Mascom has grown over three folds since 2001.

(SOURCE: Mmegi/The Reporter)

GLOMOBILE AND ALCATEL SET TO LAUNCH 3G IN NIGERIA

The Chief operating officer of Globacom, Mohammed Jameel, has stated that the 3G technology will revolutionize communications in Nigeria. 3G according to Jameel provides a convenient means to send and receive data, share information while it is hot, fresh and in demand. He expressed Globacom's readiness to launch third generation network (3G) services in the country once it gets the approval from the Nigerian Communications Commission (NCC) following the successful test run on the Glo network by Alcatel.

According to Jameel, "Alcatel has successfully tested 3G on our network. We are now ready for the commercial launch once we get clearance from the Nigerian Communications Commission (NCC)." He stressed that the 3G network would allow customers to do video call, video streaming and high-speed internet access from their 3G handset.

It also offers other advanced mobile services such as phone to phone video telephony, video greeting kiosk and video mail box. Other services available on the 3G platform include phone to fixed PC video telephony, fixed PC to phone video telephony, video-on-demand and video conferencing both on phones and Ps.

The COO disclosed hat with the completion of the test-run of 3G, the company has demonstrated its capabilities to selected corporate clients while other subscribers on the network can visit the Gloworld office to see, feel and enjoy live demonstration of 3G.

Jameel further revealed that the 3G facilities have been tested on the Globacom network in Lagos, Abuja and Port Harcourt, noting that the capability would be extended to other parts of the country shortly.

(SOURCE: This Day)

VODACOM GETS FULLY IN TOUCH WITH DRC

Putting people and their families “back in touch” with each other in a vast country is one of the highest added values of operating a cellular company in the Democratic Republic of Congo (DRC), according to Vodacom Congo managing director Dietlof Maré.

Although this market also provides a good return on investment, it is the impact that the cellular industry has had on the lives of Congolese that makes Vodacom Congo’s presence in the DRC important. A civil war ravaged the country for about six years until 2002, leaving millions of its estimated population of 60million displaced.

With almost non-existent roads and telecommunications infrastructure, expensive air travel and extremely time-consuming river travel are the only ways to access towns in this vast central African country, the size of Western Europe.

Most people cannot afford costly air tickets and travelling on a barge can take months. “Through the Vodacom investment, today over 1.8million Vodacom subscribers are able to trace displaced family members. “Relatives and friends can communicate throughout the DRC as well as with family living abroad,” said Maré. “I believe Vodacom is playing a key role in reuniting this country."

Vodacom Congo set up office in the DRC in 2001 when telecommunications penetration stood at a mere 0.2%. At that time, its main competitor, Celtel, provided coverage only in main centres such as Kinshasa and Lubumbashi, just a speck in a vast geographic expanse. The average price for a national call was 0.40US cents and 0.70US cents for international calls.

Today, penetration is estimated to be around 6%, but Maré highlighted the fact that because many Congolese own two cellphones, the real penetration rate would realistically be around 3%, making opportunities for future growth even better.

Over the past four years, the total subscriber market growth increased from 150000 to just over 3.8million for all network operators in the DRC. Subscribers can now make local calls for 0.26US cents and pay 0.40US cents for international calls.

Vodacom Congo has a market share of 49% with over 1.8million subscribers, followed by Celtel with 1.4million. Vodacom Congo’s base comprises 99% pay-as-you-go subscribers and has close to 22,000 public phones in the market.

One of the biggest challenges for Vodacom Congo was setting up its network.

Faced with a situation of non-existent or damaged roads, equipment had to be flown across vast distances. With very little or no infrastructure to back up the company, 85% of these sites run on generators, which adds to the high operating costs.

Maintenance costs and capital expenditure are also very high due to the lack of infrastructure. For example, should one of these sites go down, in some instances it would take technicians about a week to access it because of the difficult terrain. Currently Vodacom Congo covers 188 towns and has one of the biggest satellite networks in the world, with 102 links supporting its own transmission.

Maré said the company started “an electronic voucher distribution system”, where airtime was dispatched throughout the country via terminals. Altogether 98% of vouchers were distributed in this manner.

Lately it has supplemented this technology with the Voda-E process, a USSD-based system that sends air time to the distribution channels. “It basically operates like an SMS to allow people to recharge their phones through this service. This has lowered our cost of distribution and enabled us to distribute any denomination of air time anywhere in the Congo,” Maré explained.

With an investment of over $323-million in the past four years, Vodacom Congo is one of the biggest investors this central African country has seen in the past 30 years. This year alone, said Maré, the company would spend close to $63-million on its expansion strategy.

(SOURCE: Business Times)

Advertisement:
Need to know about African satellite prices' What’s happening in Africa’s VoIP markets' Need to predict traffic for Sub-Saharan African countries or North Africa'
You need Balancing Act’s forthcoming reports and you can get 10% off if you order now: http://www.balancingact-africa.com/publications.html

IN BRIEF:

- Togo Telecoms is still refusing to interconnect with legal VoIP service provider Café Informatique five years after it was set up. Neither the regulator nor the Government have enforced an interconnection agreement. Café Informatique’s licence comes up for renewal but whether the Government will renew the licence is still not yet known.

- Indications emerged that Transcorp, preferred bidder for troubled national carrier, Nitel, has paid a sum of $750m for the telecoms giant. According to local paper Vanguard the details of the Transcorp payment were still sketchy.

- In South Africa the Telecoms Action Group launched its national consumer advocacy campaign, calling on businesses and private individuals to donate money to take out a full page advert in a national newspaper, protesting the lack of alternatives in the South African telecommunications sector.

- The International Telecommunications Union (ITU) said in its latest report that Morocco leads African countries in telecommunications. Morocco ranks 78th at the world level ahead of Algeria (82), Tunisia (83), Egypt (90) and South Africa (91). In 2005, the turnover of telecom operators Morocco was MAD 25Bn, about USD 2.5Bn, a two-fold increase from 2002.


TELECOMS, RATES, OFFERS AND COVERAGE

- Nigerian telco Starcomms has expanded its CDMA network with the rollout of new cell sites in Lagos, Port Harcourt and Kano. Further sites are planned for these cities and also in Maidguri by the end of the year.

- Vodacom has added six per second Top Up packages to its current range. The Top Up Packages are a hybrid between contract and prepaid, and are designed to offer subscribers guaranteed monthly airtime credit that provide the similar benefits to contract call rates.

- Kasapa Telecom in Ghana has launched a uniquely new service dubbed " Kasapa Home-Work". This phone comes with a free chip, which is white in colour to help customers distinguish it from the green Kasapa mobile chip. The customer takes the phone to the location he intends to use it and the phone's location is then registered in the network and will only work in that neighbourhood.

- Vodacom Tanzania is launching a 3G service in the country.

Everything you wanted to know about interconnection but were afraid to ask:
A new report from Balancing Act: Setting interconnection prices in Africa. For contents see:
http://www.balancingact-africa.com/interconnect.html

Advertisement:
VoIP will be legalised in Africa.
It's not a matter of if but when. Find out where it will happen first in African Internet Country Market Profiles, Part 1: West Africa.

For details and how to order by credit card direct from the site:
http://www.balancingact-africa.com/publications.html

ISSUE NO 321 INTERNET NEWS

INDEX

EASSY SPV AGREEMENT SIGNED BY AFRICAN GOVERNMENTS MINUS KENYA

In what has been widely recognized as Rwanda's commitment to the construction of the new East African Sub-marine Cable System (EASSy), President Paul Kagame has asked beneficiary states to forge concerted efforts towards the effective implementation of the venture. "The development of ICTs to support the socio-economic development of our continent is no longer a matter of choice - it is a basic requirement. This is especially the case due to the fact that our continent has tended to lag behind other regions in most social and economic indicators, including the application of ICTs to address developmental challenges," Kagame said last week.

The President, who was officiating at the signing of a policy regulatory framework protocol for NEPAD ICT Broadband infrastructure network at Hotel Intercontinental, noted that although Rwanda had effectively played her part she needed a great deal of support.

He further noted that instead of relying on external support, the Eastern and Southern Africa (ESA) region member countries should use the initiative as an African challenge.

"This is a historic event, perhaps the first time that a major regional infrastructure project of this scale, conceived, spearheaded and promoted by Africans, is being launched," he said, adding that the project's success would only be as a result of the determination by African leadership, both in public and private sectors, to position the continent as a genuine participant in the digital global economy.

Kagame further observed that: "What we are launching today constitutes a building block for linking all parts of our continent through electronic highways. This programme should in the-not-too-distant future, connect Africa from Cape Town to Cairo and from Mombasa to Dakar, through broadband optical fiber cables."

Therefore, he pointed out, that it is imperative for ESA leadership to own policy conception, processes and systems as the only basis for providing viable developmental solutions to the region-an effort that will automatically attract partnership from the international development community.

Commenting on the preparations Rwanda had taken in fast-tracking the EASSy cable venture as a selected country to host of the Special Purpose Vehicle (SPV), Kagame said the government had already allocated office space within Kigali's ICT Park to host the SPV offices.

Citing that some initial support staff had been assigned to this effect, he explained that Rwandan government officials are to ensure immediate incorporation and operationalisation of the regional enterprise.

Kagame's reaction came after only seven counties out of the 23 countries of the ESA region signed the Policy and Regulatory Framework Protocol for the NEPAD ICT Broadband Infrastructure Network, including the EASSy Project.

Among the countries that signed the 28-page protocol include Tanzania, Uganda, Rwanda, Lesotho, Malawi, Madagascar and South Africa. The African Union Commissioner Dr Bernard Zoba signed as witness.

The signing of the Kigali protocol paves way for the Project Steering Committee to fast- track implementation of the NEPAD ICT Broadband Infrastructure Network, which, among others, involves the construction of a 9900km long EASSy cable from Mtunzini in South Africa to Port Sudan in Sudan, expected to be operational by end of 2008.

The protocol signing follows an earlier meeting of ICT Ministers in Johannesburg June 5-6, 2006 in which the Ministers unanimously approved the NEPAD ICT Broadband Network, scheduling the official signing of the protocol for August in Kigali. The round is also a culmination of several other intensive meetings with government ICT Policy Advisors, Regulators, Telecom Operators and Financial Institutions among others.

Other regional bodies such as East African Community (EAC) and South African Development Community (SADC) also held separate meetings in which respective representatives subsequently approved the Submarine cable establishment, further calling for its speedy implementation.

Meanwhile, although countries like Kenya withdrew from signing the protocol citing delays and interests, the ICT Ministers, in a press conference held after the official protocol signing ceremony said the process would advance with only interested countries. But, the high profile panel claimed it was not too late for the members that had not yet ratified the protocol, saying the deadline had been extended to November 30, 2006.

(SOURCE: The New Times)

KENYA LOSES SATELLITE LINK FOR NONPAYMENT

Millions of Kenyans across their country awoke today without access to cheap and easy communication when the company providing satellite bandwidth to more than 500 post offices cut off their services due to non-payment.

Universal Satspace, based in Israel, last week sent a fax to Kenya's acting postmaster-general, Ken Oluoch, informing him of the suspension. More than $12.4m is owed to the service provider.

Oluoch said yesterday it was a government matter, and that the contract had not been signed with Postal Corporation Kenya (PCK), but with the ministry responsible for postal services.

Satspace has now filed a claim in London, through its attorneys Mills & Reeve, claiming the money. It says Kenya's government has defaulted on payment since May last year.

According to Nairobi newspaper The Nation, the Satspace project is among 18 contracts the Kenyan government stopped paying for at the height of the Anglo Leasing scandal in August last year.

The scandal was brought to light by former secretary for governance and ethics, John Githongo, who had previously headed Transparency International in Kenya. He resigned in February last year after he uncovered massive looting and grand corruption involving top government officials.

After five quarterly instalments of $1.12m were missed, the whole amount due to Satspace plus the interest became due. According to a source close to the project, the entire contracting process with the Kenyan government was clean and "there was nothing untoward about it. "The government is simply using it as an excuse not to honour its commitments." The Kenyan government signed the contract in July 2002 to modernise and upgrade the country's postal network -- making its system a model for the continent.

The contract had two main elements: first, the provision of bandwidth and network management to link all the PCK post offices to include the internet telephone and fax system which would be an essential management tool for the running of the post office network. It also enabled the provision of cheaper fax and high-speed Internet access than what was offered at Internet cafes.

In April 2004, the communication commission of Kenya said of the project's final inception report: "This is a government project, with ministries of transport and communications, and finance being the two ministries involved."

Universal Satspace CEO Abraham Ziv-Tal said yesterday from Tel-Aviv that the Kenyan government was using the "corruption" angle as an excuse. "It simply does not suit them to pay. Our system worked perfectly for the PCK for two years.

"The tendering and contracting for this project was exemplary. Now people are going to suffer because as of midnight, they will no longer have a service they have got used to and come to expect as their right.

"I hope that we will win our claim when it comes to court. But of course, nothing is assured. It will be a tragedy for Kenya in the long term if we do not win, because nobody will then be willing to enter into any sort of contractual agreement with the Kenyan government," he said.

The Satspace dispute is not the only contractual matter Kenya faces. Earlier this month the government, which has been defending a lawsuit in the Hague which involves, as The Nation describes, another Anglo Leasing-like project, lost a court application to stop an order for seizure of the Kenyan embassy in the Netherlands, if it did not make good on a military contract worth $37,2m.

The Nation ran a feature two weeks ago outlining a new initiative planned by the post office, in which it had teamed up with Afripayments, a local company with international partners, to launch a new service for rapid money transfers.

The article says: "To PCK, the new service means that it has now found a more profitable use for its two-year-old countrywide Vsat (very small aperture terminals) based internet link, a service that it is providing almost as a giveaway."

(SOURCE: Business Day)

IBURST LAUNCHES IN GHANA

The iBurst wireless broadband system is now available in Ghana, after Infinite Stream Ghana recently launched the service in collaboration with BusyInternet. SA iBurst users are now able to roam in Ghana and vice versa.

ArrayComm is the developer and patent holder of the iBurst broadband wireless system sold globally by licensees. iBurst is currently available in Ghana, SA, Australia, Kenya and Azerbaijan.

iBurst is designed to optimise the use of bandwidth with the help of smart antennae. It aims to offer the speed of DSL in a mobile environment, reliability and an IP base designed to allow a network to be established quickly and affordably.

“Over the last decade we have watched the rise and fall of copper promises. African countries see the potential of broadband, and are desperately looking for other ways to obtain reliable, high-speed Internet access without resorting to miles of expensive copper cables. Ghana obviously realised that the decision to go the iBurst wireless route would allow an alternative broadband provider to be up and running as quickly as possible,” says Thami Mtshali, CEO of iBurst SA.

iBurst will initially only be available in parts of Ghana’s capital city of Accra. The service is available in three contract packages and a prepaid version, where subscribers pay an hourly rate with no data cap.

The company hopes to extend coverage to other parts of Accra, and also to other cities in Ghana in the near future. Further details are available on www.iburstghana.com.

(SOURCE: ICT World)

FREE WIKI ONLINE TEXTBOOKS PLANNED FOR DEVELOPING NATIONS

A US-based initiative plans to make new textbooks available for free on the Internet for university students in developing nations.

If the Global Text Project's first book -- due in January 2007 -- is a success, the project aims to produce 999 more titles covering biology, physics, mathematics and chemistry.

Funding will be sought from the world's 1,000 largest and richest companies, each of which will be asked to sponsor an individual title.

The plan is to increase students' access to educational material by overcoming the expense of traditional textbooks, which quickly become outdated.

Leading professors worldwide will be invited to contribute chapters that will then be compiled into up-to-date texts using the software behind Wikipedia, the popular free-access online encyclopaedia.

An international advisory board drawn from universities in Colombia, Egypt, Malaysia, South Africa, Uganda and the United Kingdom has been set up to oversee the books' creation.

With Wikipedia, entries can be updated and modified by anyone who registers with the site. The Global Text Project will use a modified version of the software behind the website, so that only its editors will be able to accept any suggested changes to the texts.

The books will be written in English and then translated by volunteers into Arabic, Chinese and Spanish.

Students will be able to read the books online or print them as pdf files, and will be encouraged to contribute to future editions.

"These books should never be out of date because they will be subject to continuous improvement," says the project's website. "Each class using one of the books will be asked to add value to the book. They should leave a better book for the next class."

Rick Watson, a professor at the University of Georgia's Terry College of Business in the United States, is leading the initiative.

He points out that traditional textbooks are simply too expensive for the majority of students in developing nations, even when publishers offer a 50 per cent discount.

Faiq Billal, director of science at the Islamic Educational, Scientific and Cultural Organization, welcome the plans.

"In most developing countries, curricula are not up-to-date and in some countries very obsolete books are still used," he told SciDev.Net.

Billal points out however that other obstacles -- such as a lack of infrastructure and trained teachers -- stand between such countries and the wealth of the world's information. "We should not forget that access to Internet is also limited in developing countries."

(SOURCE: SciDev.Net)

COFFEE FETCHES RECORD PRICE VIA INTERNET AUCTION IN ETHIOPIA

A co-operatively-grown Ethiopian coffee sold for USD 10.65/lb at an Internet coffee auction held last Thursday, the price setting a record in the history of Ethiopian coffee export, The Daily Monitor learnt.

Ranked No.1 among 27 washed and unwashed lots of cooperatively-grown Ethiopian coffees at the second annual ECAFE GOLD 2006 Internet Coffee Auction, the sun-dried natural (and organic certified) lot from the Yirgacheffe Coffee Union's Hama Cooperative was purchased by Japanese quality coffee buyer Ken Motoi with the stated price, which turned out an ECAFE record as well.

The record price reported is nearly ten times higher than the conventional price at the New York C Market, which stood at USD 1.03/lb till last week.

In order to promote Ethiopian quality coffees to international buyers and help Ethiopian farmers secure better prices for their produce, ECAFE (Exemplary Coffee Education) - a non-profit US-based organization established to promote exemplary coffee in the world - decided to make the auction an annual event, ECAFE representative had told The Daily Monitor a year ago, when her organization was preparing to launch the first auction.

In the last year's auction, the highest bid registered was USD6.5/lb for a coffee bean grown by a cooperative operating under the Sidama Coffee Farmers Union.

"Although the volume of coffee beans put up for auction through ECAFE Internet Coffee Auction is small, the event will play a major role to introduce and promote Ethiopian quality coffees," the Union's Export Division Head Ashenafi Araw has told The Daily Monitor.

According to ECAFE, the number of bidders participated in this year's auction, which was nearly 200, has more than doubled compared to that of last year's.

After six intense hours of bidding, the Japanese buyers has came out big winners, walking away with 342 60Kg -bags of coffee out of the total 695 bags put up for auction, according to ECAFE.

(SOURCE: The Daily Monitor)

IN BRIEF:

- South African technology company Saab Grintek says it is now ready to add WiMAX services to its communications solutions portfolio. The firm has completed several trials of WiMAX equipment as an alternative to Ethernet and radio backhaul technologies.

- The Ghanaian Ministry of Communications has drafted the Electronic Transactions bill that would remove and prevent barriers to electronic communications and transactions. The bill will also promote legal setting and confidence in electronic communications and transactions in addition to developing a safe, secure, and effective environment for the consumer, business and government to conduct and use electronic transactions.

- In Zimbabwe the society organisations (CSOs), the business community and political parties urged the government to withdraw the Interception of Communications Bill 2006 to allow for extensive debate on its constitutionality and whether it is necessary and justifiable in a democracy.

ADVERTISEMENT

Need to know about the state of the internet in West Africa?

The key issues in each country? Who are the ISP players? What number of subscriptions? The size and state of the international and domestic backbones? The number of cyber-cafes? The state of play with regulation? What content exists?

The long awaited first part of Balancing Act's African Internet Country Market Profiles is now out and covers 22 countries in West Africa. It also contains a summary overview of the internet in these countries and a look at the coming legalisation of VoIP in West Africa: who will be the winners and losers?

To see the contents: http://www.balancingact-africa.com/profile1.html
To order: http://www.balancingact-africa.com/publications.html
You can now order direct from the web site by credit card.

ISSUE NO 321 COMPUTER NEWS

INDEX

SOUTH AFRICA PATENT OPPOSITION COULD BE COSTLY

The battle to get a Microsoft-held XML patent overturned may not be as easily won in South Africa as it was in New Zealand last week. And it is likely to cost a great deal more than the New Zealand challenge. This is according to local anti-patent activists and the head of the New Zealand Open Source Society(NZOSS) Peter Harrison. NZOSS led the challenge to the patent in New Zealand.

One of the critical differences between the two scenarios, says Harisson, is that the patent was defeated at the "pre-grant" stage in New Zealand while in South Africa the patent has already been granted by the patent office.

This means that in South Africa the patent will have to be challenged in court. “As such," says Harrison, "it will be a far more expensive endeavour."

Bob Jolliffe, a founder of Freedom to Innovate South Africa (Ftisa) and the person who initiated the fight when he delivered papers to Microsoft's lawyers in June last year requesting they relinquish the patent, says "the NZOSS case was a pre-grant opposition. This is something we simply don't have and it’s a major problem with our system. "Not only are [locally filed] patents not examined properly, but we don't even get the opportunity to challenge them prior to being granted.

"The main issue that [the South African case] raises," says Harrison, "is the poor quality control on patents. There is very clear prior art on this patent. It would not last long in court, but this assumes that the person or company being sued has resouces to fight it."

However, says Harrison, "the real issue here is not the behaviour of Microsoft or any other software company, but the ... poor quality of patents which can damage the South African innovative industries.

"The NZOSS is also lobbying government in this regard, and there is a Patent Bill before the NZ Parliament due to be passed in 2007."

Harrison warns, however, that the issue is far bigger than just one patent or one company. "If the system isn't fixed you may find a huge wave of patents that will overwhelm small software development shops. This is what we are trying to avoid."

(SOURCE: Tectonic)

OVER 80% OF ICT REFORM’S GOALS ACHIEVED IN ALGERIA

Over 80% of the reforms’ goals in new information and communication technologies’ sector (ICT) have been “achieved,” according to Mahieddine Ouhadjj, senior executive at the Post and ICT ministry. In talks with APS, he said the reforms which started as the declaration of sectoral policy was adopted in 2002, allowed to meet the demand as far as mobile and fixed telephones are concerned, which rate rose from 6% from 1962 to 2000 to 61%, i.e. about 20 million lines. As regards mobile telephony, the number of lines comes to 16 million at present, he said, adding "Algeria is one of the rare countries to have three mobile telephone operators at the same time."

(SOURCE: APS)

IN BRIEF:

- Oracle has released another free software tool for building, deploying and managing secure Web applications using only a Web browser. Oracle Application Express Release 2.2 makes it easier for users with limited programming experience to develop software for the Web that can be deployed quickly to up to thousands of users.

ISSUE NO 321 ON THE MONEY

INDEX

CELTEL TO INVEST US700M IN NIGERIA

Celtel, which acquired 65% of V-Mobile in June for just more than US1bn, is investing at least US700m in the next two years to expand its V-Mobile network, reports website Andnetwork.com. The investment is a bid to push for about 30% of the market for the GSM service provider in the next five years.

The Kuwaiti-based firm, with 13 networks in other African countries, is eyeing about 15-million more telephone lines to add to the existing 7-million lines in the V-Mobile network in the next five years.

The company already has 22-million lines in its network, 15-million of which are in Africa. The amount to be invested is for network development alone. It excludes expenditure in the rebranding of V-Mobile to its new name Celtel. That process has begun internally, while the public launch of the Celtel brand in the Nigerian market will take place soon. The rebranding process will coincide with the naming of a new CEO for Celtel Nigeria.

Celtel International Group CEO Marten Pieters said his company was bullish about the Nigerian operation. He said Celtel expected that five years from now there would be 350-million GSM customers in Africa, and 50 million would be in Nigeria, meaning one in seven subscribers would be Nigerian.

(SOURCE: Business Day)

MTN FIGURES SHOW VERY FEW HICCUPS DESPITE ERRATIC LOCAL PERFORMANCE

MTN has bounced back from a temporary dip in South African subscriber numbers to claim a pan-African customer base of 24,4-million, generating a net profit of R5,39bn in the six months to June 30.

For every R1 spent by its customers MTN retains 42,9c, a profit margin that is steadily rising to make the cellular operator even more lucrative than in previous years. Now the money machine is poised to become much larger, as the operations acquired in its $5,5bn takeover of Investcom will be reflected in its future financial results.

MTN's figures show a revenue growth of 17,6% to R20,2bn for the interim period, with adjusted headline earnings a share up 27% to 278,5c.

Current liabilities touched R12,7bn and approved capital expenditure stood at R11,2bn, with Nigeria, SA and Iran demanding the bulk of that. Its cash position was a positive R712m at the end of June, but the Investcom deal had knocked it back into debt, said chief finance director Rob Nisbet.

MTN presented separate figures for Investcom, emphasising that its operations in Africa and the Middle East were profitable and would strengthen its own balance sheet, skills and experience. When Investcom's 6,14-million users are factored in, the total number of customers tops 31,5-million.

MTN's figures showed very few hiccups, although its performance in SA was erratic. It claims 10,4-million local users, up only 2% since December last year. That had recovered from a dip in the first quarter when customers defected to other networks because some of its products were not competitive, said Nhleko.

The average revenue per user in SA fell 5% to R159 a month, a decline that was expected as cellphones penetrate deeper into the market, he said. To keep its margins up, MTN planned to take tighter control of the distribution channel by operating more of its own retail outlets.

For the group as a whole, Nhleko said the profit margin was growing at a much more rapid rate than the revenue, showing that initiatives to improve its operational performance were paying off.

The goal was to achieve an overall 45% profit margin. At the moment its start-up networks in Zambia, Côte d'Ivoire and Congo have low margins as roll-out costs soak up the cash, and in SA its profit margin is also much lower at 33%. The highest margins come from Nigeria, Rwanda, Swaziland and Cameroon, where the networks serve mainly affluent users.

While SA and Nigeria were still its most profitable operations, the Investcom acquisition would diversify its income and offered particularly bright prospects in Ghana, Sudan and Syria, said Nhleko.

The deal would also create economies of scale, possibly letting it slash $300m-$400m off its operating expenses over the next 18 months. Its network in Iran, where it holds 49% of Irancell, will launch at the end of September.

(SOURCE: Business Day)

RAND VOLATILITY DEALS MUSTEK PROFIT BLOW

Foreign-exchange losses have again severely dented computer manufacturer Mustek's operating profit with the rand's "sudden and sharp" depreciation forcing it to account for R57m in unrealised foreign-exchange losses.

Its headline earnings a share fell to 43,3c in the year to June from 86c previously. Some of the losses should be recovered in the new financial year as the rand strengthens and Mustek puts up its prices to recover lost ground, CEO David Kan said yesterday.

A final dividend of 25c a share was declared, topping up an interim dividend of 35c, matching the total dividend of 60c paid out in the previous year.

Mustek produces SA's top-selling Mecer PC, and imports a range of information technology hardware. It has been hit at least twice in the recent past by foreign exchange losses as it misjudged currency fluctuations, leading to a policy of partially hedging against the volatility through forward-exchange contracts.

Its results issued yesterday show revenue up from R2,8bn to R3bn and gross profit up from R471m to R502m. But a rise in operating expenses left its net profit down from R96m to R74,5m. Gross margin remained stable at 16,6%.

The 8% rise in revenue from continuing operations was stoked by a 10% increase in the number of Mecer PCs it sold, and a higher contribution from its international operations.

However, Mustek may pull out of its operations in Brazil, which it opened to produce affordable computers for the massive Brazilian market. The division saw revenue growth of 45%, but lost R12,2m due to low profit margins and a lack of manufacturing experience. Mustek will reassess the feasibility and decide whether to remain in Brazil.

Efforts to stem continuing losses in the UK arm of its hardware distributor Rectron proved insufficient, and the UK operation was closed.

A strong focus on working capital management created a solid operating cash flow of R222m, Kan said, and cash resources stand at R477m. That was partly aided by selling Rectron's buildings in Johannesburg and Durban for R95m.

During the period, Mustek bought the 30% of Brother Business Machines that it did not own, then funded the sale of that 30% to a black empowerment consortium. Kan said the managers were committed to further transformation and economic empowerment of its stakeholders, with a caveat of ensuring there were commercial benefits to improve the sustainability of the group in a competitive sector.

Big clients include large companies, government, parastatals, retail and IT dealers. Kan said the IT industry was in a growth phase likely to go on until at least 2010. Microsoft's next operating system, Vista, due next year, should drive a new round of hardware upgrades.

The steadily falling cost of broadband in SA should stimulate demand for more home computers and the market for home PCs was barely tapped and offered huge potential, he said.

(SOURCE: Business Day)

IN BRIEF:

- The Arab Fund for Economic and Social Development (FADES) loaned Morocco 450 million dirhams (about US$50 million) for the expansion of information and communication technologies (ICTs) in the public education sector.

ADVERTISEMENT

Reaching the Agents of Change

The Big Change is the e-mail newsletter of venture capital, deal-making, and business strategy in the convergent economy. Our team of experts provide regular insights into technology and business trends and strategies. For your convenience, The Big Change compiles a weekly digest of links to news, research, advice, case studies and dealflow trends from around the world. Subscribe at no cost by sending a blank e-mail to:

join-TheBigChange@elist.co.za

ISSUE NO 321 WEB AND MOBILE DATA NEWS

INDEX

KENYA AIG TRAVEL INSURANCE COVER AVAILABLE ONLINE

Agents can now buy AIG Kenya travel insurance cover online. Travel agents and brokers can buy the product through an interactive website launched on Thursday.

"We are committed to being a leader in general insurance services through innovation in information technology and consistent provision of quality customer care", AIG managing director Japh Olende said during the launch of the new product in Nairobi. Olende stressed the importance of making travel insurance because no one knows what could happen while on a trip either locally or abroad.

"Travel insurance can comes in handy when one is in a situation that could result in heavy financial losses due to lack of insurance," he said.

AIG accident and health manager, Walter Orato, said the Internet was rapidly becoming an effective tool for agents and suppliers to provide various services.

"In addition to considerable savings in terms of cost and reduced bureaucracy, chances for errors on online services are less as compared to paper or telephone orders," said Orato.

He added that like airlines, which have taken advantage of technology by introducing e-ticketing, AIG has also recognised the need to take advantage of the ever changing technology to bring about efficiency and convenience to travellers.

(SOURCE: The East African Standard)

GHANA LAUNCHES NEW ONLINE PORTAL

Speaking at the launch of eMartghana.com in Accra, the Deputy Minister of Communications, Dr. Benjamin Aggrey Ntim was happy with the introduction of e-commerce in Ghana and called for awareness creation about it. On behalf of the Vice President, the Deputy Minister launched the service.

The board chairman of the company, Abu Millah, said eMartGhana.com is a one-stop electronic market for all kinds of goods and services in Ghana and the most convenient and time saving shopping experience for everyone, home or abroad.

He said it provides online market for any business that dealt in goods and services; groceries, beauty and health products, real estate, cars, hotels, banking, legal, accounting and auditing services, freight forwarding, and many others.

"Goods come with detailed descriptions and detailed prices in all major international currencies," he explained. "This enables the consumers to make their buying decisions more easily and have shopped-for items delivered to any destination in Ghana or abroad."

With this, consumers can shop in the comfort of their homes, offices or anywhere through the use of the Internet, telephone or fax. Millah said eMartGhana.com would bring a critical mass of both sellers and buyers together in a manner unprecedented in Ghana. "It is predicted that in the not too distant future, e-market will replace brick and mortar markets," he envisaged.

(SOURCE: Ghanaian Chronicle)

ISSUE NO 321 CONVERGENCE NEWS

INDEX

SABC AND TELKOM APPLY FOR NEW PAY CHANNEL SERVICE

The South African Broadcasting Corporation (SABC) and Telkom have each announced plans to join the subscription channel market.

This is in response to an invitation published by the Independent Communications Authority of South Africa (ICASA) earlier this year.

The South African pay channel market is currently the domain of Multi-Choice's two services, Mnet which has operated via decoder-cable since 1986 and its newer satellite division DSTV.

Terrestrial television services are provided by state broadcaster SABC and privately owned eTV.

Telkom said the first step in its process to provide an alternative paid-channel service, was the creation of Telkom Media (Pty) Ltd, a private company with a 41.5 percent Black Economic Empowerment shareholding.

Telkom media applied to ICASA on Thursday for a commercial satellite and cable subscription broadcast license.

Partners in the joint venture are Videovision Entertainment, MSG Afrika Media and Women Development Bank Investment Holdings (Pty) Ltd.

This shareholding, said state-owned Telkom, combines a wealth of electronic media expertise.

"The goal is to substantially broaden access to pay-TV services within the South African population and open the gateway to new convergent services," said Wally Beelders, Telkom's Chief Sales and Marketing Officer.

Telkom described the current offerings as being targeted in terms of price, content and marketing at the high income market and as offering very little flexibility; with its own research indicating that over 40 percent of South African households were willing to pay for this service.

Initial offerings in Telkom's satellite subscription service will provide subscribers with access to seven locally compiled television channels.

The basic bouquet will consist of dedicated channels respectively for entertainment, 24-hour South African news, movies, sport, music, education and shopping.

Entry into the bouquet will be priced at a level that is favourable to the majority of South Africans, said Telkom.

The SABC has since formed a strategic partnership with another state-owned enterprise SENTECH and jointly applied to enter this market, which they said "cannot be purely for commercial interest but must also serve the public interest."

"The entry of SENTECH and the SABC and other players into the broadcasting subscription market will end the monopoly that has been in existence in the subscription broadcasting sector for over a decade and will broaden the base for South Africans who can enjoy the fruits of the recently promulgated Electronic Communications Act," said SABC Group CEO Dali Mpofu.

As the technology partner in the consortium, SENTECH would provide the infrastructure and technology skills to enable the establishment of a subscription service while the SABC's main contribution would be content provision.

Affordability, local content and choice are the key drivers behind the application, they said.

(SOURCE: BuaNews)

E.TV WANTS TO LAUNCH SATELLITE TV

Sabido Ltd, the sole shareholder of free-to-air television service e.tv, has applied for a satellite television subscription broadcasting licence.

Sabido's majority shareholder is Hosken Consolidated Investments, a trade-union controlled black empowerment company listed on the Johannesburg Stock Exchange.

e.sat intends to provide a unique subscription television broadcasting service to middle income South Africans who are presently under-served by subscription television. It will do so by providing a predominantly locally-compiled programming service which includes movie, news and sports channels.

e.tv has a proven track record as a successful commercial television broadcaster in the South African market.

After a tough launch in a highly competitive environment in 1999, e.tv became cash positive in 2004. The station now commands a 22 percent audience share and is the second largest television channel in the country.

e.tv CEO Marcel Golding said: "In applying for a commercial satellite subscription broadcasting licence, e.sat intends to leverage the experience gained by Sabido and e.tv in launching and operating a successful South African commercial television business."

Golding added that e.sat was uniquely positioned to introduce competition into the pay-television market.

(SOURCE: INet-Bridge)

LETTER FROM NIGERIA: EFCC GOES ON A FOLLOW THE MONEY CHASE WITH SNO GLOBACOM

Money, politics and telecoms are Africa’s constant bed-fellows but no more so than in Nigeria where wherever there are large financial deals, there is always the feeling that the politicians are never far behind. Nigeria is a very rich country (with a lot of poor people) and it is as well not to enquire too closely where the money came from.

The past few weeks have seen the brief detention of Globacom’s Chair Mike Adenuga and the son of ex-President (General) Ibrahim Babangida. So what’s going on? When you ask Nigerians in the industry, they shrug their shoulders and smile before all without fail utter the same word:”Politics.” A senior politician is alleged to be a shareholder in SNO Globacom although there is no evidence to support the allegation.

The Economic and Financial Crimes Commission (EFCC) raided several companies two weeks ago including Globacom and held Adenuga and Babangida’s son as part of this operation. According to a report in This Day, sources at the EFCC told it that it was pursuing the origins of the money used to purchase a 24% share in Globacom and whether the money originated from the Government-run Petroleum Technology Fund, set up under the previous Government.

Sources close to Adenuga claim that his bank Equatorial Trust held money from the Fund along with 15 other banks but that both the principal and interest on it were paid back. Furthermore the Fund has been audited and re-audited and no amount was found missing on either occasion.

Adenuga’s empire has a large headquarters building named with characteristic Nigerian modesty, Mike Adenuga Towers. He owns not only a bank but a large oil company called ConOil. Also those with longer memories will not have forgotten Adenuga’s involvement with one of the original winning bids for the first three mobile licences through Communications Investment Ltd. It lost its deposit when the operation did not go forward.

The sources quoted in This Day claimed that Babangida’s son had bought shares in Globacom using a fictitious company and that in the course of their investigations they had been able to trace the shareholding ownership back to him. The allegations are denied by Babangida’s son. As a privately held company, a written account of its shareholdings are held at the Corporate Affairs Commission but unlike in other countries, these records are not open to public scrutiny.

Meanwhile local Nigerian investment holding company Transcorp is in the process of buying state-owned incumbent Nitel. It bid US$750 million and was late in making the down-payment. Informed sources say that having agreed financial contributions and shareholding levels with bid consortium member Etisalat, Transcorp’s owners then tried to change the shareholding levels at the last minute. Unaccustomed to the Nigerian way of doing things, Etisalat walked from the deal leaving Transcorp to find the money elsewhere. Luckily it has found 12 local banks to step into the breach and local reports say the complete payment was made this week.

So what as they say, does this have to do with the price of fish? Well Transcorp’s owners are close to President Obasanjo. The company has had a run of good fortune in being the winning bidder to acquire a number of state assets and is currently on the reserve list for a recent state sell-off. Indeed it emerged as the winning bidder for Nitel after the previous process was cancelled because the bids were declared to be too low.

Naturally Nigerians cannot believe that this would be possible without the President having acquired a shareholding of his own along the way. Of course there is not a single shred of evidence to support these unlikely rumours.

So what is going on? It’s not entirely clear but it would seem that the Globacom investigation is a way of bringing pressure on Babangida not to run for the presidency. Sources close to Babangida’s son hit back by saying:”You see, the same EFCC which arrested Mohammed (the son) was there when it was alleged that Obasanjo’s son bought a house in the USA at the princely sum of N75 million and although the person accused was not working, he was not investigated. We know where they are coming from but…they will fail.” However opinions on the EFCC clearly vary as one industry insider told us:”I give the EFCC ten out out of ten for making an impact on corruption.”

(It should not be forgotten that according to CBS News Nigeria’s Vice-President Abubakar Atiku was named as the intended recipient of a US$100,000 bribe intended to secure telecoms and Internet contracts in a recent case in the USA and that his home in Potomac, Maryland was searched as a part of that investigation.)

The cynical will simply say, this is Nigeria and what can you expect? But for those publicly-quoted external companies wishing to invest in the telecoms and Internet sector in this market, it can only make them extremely nervous about the prospect of getting involved. In the meantime both Mike Adenuga and his two sons have left the country on pre-planned business trips.

ISSUE NO 321 PEOPLE, EVENTS, JOBS, CONTRACTS

INDEX

PEOPLE

* Mascom Chief Executive Officer, Jose Antonio Ferreira said this week that he is moving on to other challenges after five years of service at the largest mobile phone service provider. Ferreira said the time has come for him to answer to new challenges as he joins another mobile operator, MTC in neighbouring Namibia.

* The MTN Group has announced the appointment of Shauket Fakie as Group Executive, Business Risk Management.

* Datatec has announced the appointment of Professor Wiseman Nkuhlu to its board of directors. Nkuhlu will serve as a non-executive director and a member of the audit, compliance and risk committee. The appointment will be effective from 1 September.

* The Nigerian government has sacked the Director- General of the regulatory National Broadcasting Commission (NBC). The statement, issued in the nation`s capital of Abuja at the weekend, said Dr. Silas Babajiya Yisa`s removal was in line with the on-going re- organization in the ministry and its parastatals.


EVENTS

- THE 4TH ANNUAL CTO FORUM 2006

4th – 6th September 2006, London

This year’s key focus areas are on realising the socio-economic benefits of mobile communications, policy making to encourage competition, regulating for mobile success, incorporating new technology to aid mobile development and generating the highest possible ARPU.

For further information visit the CTO’s website http://www.cto.int/forum06/

- IWEEK 2006

4 - 7 September 2006, Castle, Kyalami in Midrand, Gauteng

The event is organised by ISPA and UniForum SA (the .co.za registrars) The programme brings an extensive range of industry experts from across virtually every continent, making this an exciting and extremely worthwhile event to attend.

For further information visit http://www.ispa.org.za/iweek/2006/program.shtml

- TELECOMS WORLD AFRICA 2006

4 - 8 September 2006, Cape Town, South Africa

The event offers a uniquely African perspective and brings together leaders from multiple markets and disciplines to create the ultimate African industry networking experience. Contacts can be made, experiences shared, alliances forged and participants will profit from ideas, information and know-how.

For further information visit http://www.terrapinn.com/2006/telecomza

- DIGITAL WORLD CONFERENCE 2006

12-13 September 2006, Transcorp Hilton Hotel, Abuja, Nigeria

The Nigerian Communications Commission (NCC), in collaboration with the Growing Businesses Foundation (GBF) and the TT30 Club of Rome will hosting the Digital World Conference 2006. The theme of the forthcoming conference is "ICTs for Education and Development.

For further information visit www.ncc.gov.ng

- AFRICAN BILLING & TELECOMS REVENUE ASSURANCE FORUM

11th - 15th September 2006m, Southern Sun, Cape Town, South Africa

Five focused days of conference and seminar sessions addressing the specific Revenue Management challenges currently being faced by African Telecoms Operators and Service Providers. This forum presents an invaluable opportunity to hear real-world experiences in a series of cutting-edge case studies and workshops led by African, European and American Operators. For more information, please visit the website at http://www.iir-events.com/IIR-Conf/page.aspx?id=2246

- REGIONAL SEMINAR ON BROADBAND WIRELESS ACCESS FOR RURAL AND REMOTE AREAS IN AFRICA

18th-21st September 2006, Yaoundé, Cameroon

The seminar will examine the technological, economic and regulatory factors that influence the availability and deployment of wireless broadband services. The event will provide an opportunity for wireless broadband business, technology and regulatory experts to share their knowledge, experience and views on the future of the industry with ITU and hosting administration attendees.

For further information visit http://itu.int/ITU-D/imt-2000/BDTActivities.html

- WORKSHOP ON BROADBAND OVER POWERLINE

3-4 October 2006, Dakar, Senegal

The African Telecommunications Union (ATU) is holding a workshop on Powerline Communications (PLC), the alternative last mile platform utilizing the electricity network. The workshop will address key issues such as technology, invest and business case, standardisation, hybrid platforms (Satellite, Wireless, Fibre & PLC) and others.

For further information visit the ATU website at www.atu-uat.org.

- 2ND INFRASTRUCTURE PARTNERSHIPS FOR AFRICAN DEVELOPMENT (IPAD) CENTRAL AFRICA

3rd-5th October 2006, Grand Hotel, Kinshasa, Congo Democratic Republic 2nd Infrastructure Partnerships for African Development (iPAD) Central Africa will take place from the 3rd-5th October 2006 at the Grand Hotel, Kinshasa.

For further information visit www.ipad-africa.com

WEST AFRICAN SATELLITE COMMUNICATIONS SUMMIT

31 October - 2 November 2006, Le Meridien Hotel, Abuja, Nigeria

The summit is dedicated to the deployment of satellite and satellite hybrid-based communications solutions across the region of West Africa and will provide an unparalleled networking opportunity for global and regional satellite communications providers to meet with ever-expanding communities of vertical market communications end-users.

For further information visit http://www.gvf.org/gvf/events/index.cfm

* GSM-3G WORLD SERIES - NORTH AFRICA

8-9 November 2006, Sheraton Tunis Hotel, Tunis, Tunisia

"What are the market impacts of additional competition and 3G licensing in North Africa? How can you attract new users to drive forward penetration? And more importantly what plans do your suppliers, clients and competitors have for this region? The 5th GSM>3G North Africa is the one forum in the region vital to manufacturers, application developers, operators and regulators who are active, or seeking to be active, in the North African market.

For further information visit www.gsm-3gworldseries.com/northafrica"

- 1ST INTERNATIONAL ICT INVESTMENT CONFERENCE FOR AFRICA

14th – 15th November 2006, Tunis, Tunisia.

Under the auspices of Secretary General United Nations Conference on Trade & Development (UNCTAD) Regarding sponsorship or delegate attendance, please contact Dan Morrissy in London on +44 207 2871326 or at dmorrissy@i-ep.com


CALL FOR TENDERS

- CALL FOR PROPOSALS (CFP) FOR CONNECTIVITY OF THE EAST AFRICAN INTERNET EXCHANGE POINTS (EAIXP)

Latest news: Deadline extended to 15th September 2006

This project aims to keep the East African internet traffic local to the region through the creation a meshed network that would facilitate the exchange of regional internet traffic within the region without having to involve exchange points outside the region. By interconnecting the Internet exchange points (IXPs) in Kenya, Uganda and Tanzania, traffic destined to a location within East Africa will be delivered as a local traffic instead of it traveling all the way to an overseas exchange point only for it to be rerouted back to East Africa. This invitation is open to any firm interested in providing interconnection or to act as a carrier between the three IXPs. Duly completed tender documents should be mailed to or deposited in the respective regulator’s tender boxes on or before 15th September 2006 at 2.30p.m.

For further information contact the CCK, UCC or TCRA


JOBS AND OPPORTUNITIES

* RF PLANNERS – EGYPT

A leading client needs RF Planners in Egypt with at least 3 years experience with GSM 900/1800 planning. Candidates should have solid knowledge with Planning tools and Antenna Optimization. Activities include site planning, site surveys, parameters setting, frequency planning, drive testing and capacity planning.

For further information contact advertising@balancingact-africa.com

* ACCESS TO LEARNING AWARD

We invite you to apply for the Bill & Melinda Gates Foundation’s annual Access to Learning Award.This award recognizes excellence in providing access to information by utilizing new information and communication technologies in an innovative way,at no cost to the user. The recipient will receive an award of up to US $1 million. The award is administered by the International Network for the Availability of Scientific Publications (INASP).

Completed applications should be sent to INASP and must be postmarked or emailed by 31 December 2006. A PDF version of the application will be available for downloading to your computer from www.inasp.info/ldp/awards.

* GSM ACADEMY - BSS O&M TRAINING FOR AFRICAN PROFESSIONALS

Starting October 2, 2006, TOP will provide a GSM curriculum for Expert Training on BSS Operation & Maintenance. The boot camp includes 3 months of lectures and hands-on labs and is completed by 6 months of apprenticeship at a European GSM network operator. This heavily sponsored program targets on African engineers / technicians to improve their job possibilities in their home countries.

For further information visit http://www.topbusinessag.com/e/news/07-04-2006_gsmacademy.php


CONTRACTS: WHO'S SELLING WHAT TO WHOM?

* SIEMENS AND VODACOM – TANZANIA

Vodacom Tanzania says that it will introduce 3G technology to its local market. Based on the success of 3G implementation in SA, Vodacom Tanzania has chosen Siemens Communications to supply the full 3G solution. According to Vodacom, the competitiveness of Siemens, in terms of pricing, availability of expertise and support with future roadmaps, contributed to its decision.

* UNITEL AND ERICSSON – ANGOLA

The country's mobile phone company Unitel and the international firm Ericsson signed an agreement on the supply, installation of equipments and services, amounted at USD 150 million. The amount is part of the total sum of investment for this year, amounted at USD 250 million.

* MULTI-LINKS AND HUAWEI – NIGERIA

Huawei Technologies Co., Ltd, has won a contract to install a CDMA network in Nigeria for Multi-Links, a telecom operator in the country.

Advertisement:

African Internet Country Profiles: Part 2
ORDER NOW

To see the contents: http://www.balancingact-africa.com/profile2.html
To order: http://www.balancingact-africa.com/publications.html
You can now order by credit card direct from this web site.

INDEX

If our correspondent is "off the mark" or you have factual amendments, mail them to us and we will include them in subsequent News Updates. If you'd like to contribute, write and let us know.
If you need information about a particular place or issue, just send your questions in. We are always happy to follow up on readers concerns.

News Update is a free e-letter produced by Balancing Act that covers African internet content and infrastructure developments, It goes out to government, the private sector, education and NGOs. To subscribe, send a message saying "I want to subscribe" to info@balancingact-africa.com


This page last updated on September 11 2006.

balancing act home page