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WEEKLY PUBLICATION DEADLINE: 12 pm GMT Sunday. ISSUE NO 380 West Africa: The great mobile pricing mystery – who’s cheap and who’s expensiveEven for the sophisticated consumer, comparing mobile rates in Africa is a complicated business because often clear information is simply not available. The position is further complicated by the blizzard of tactical marketing promotions when operators make you an offer you can’t understand. But beneath this confusion is a key issues for the operators themselves about how they set pricing. Russell Southwood and Kelly Wong look at analysis of prices in West Africa and seek to work out what it all means. Balancing Act’s report African Telecoms and Internet Markets: Part 1 – West Africa looked at comparisons between retail, domestic mobile calling rates across the 16 West African countries under review. The sample of rates covered 35 out of 52 operators in the selected countries, 67% of all operators in the region. The sample covered 150 calling rate plans, both pre- and post-paid. The rates taken from the operator web sites come in a bewildering range of different formats but they have all been standardised for the purposes of comparison. The data was gathered between April and Mid-May 2007 and rechecked in August 2007. At the initial point when the data was colleced, 16 of the operators either did not have web sites or if they had one, did not make their rates publicly available. Some required users to ring sales staff to check rates. Not listing calling rates for consumers shows a lack of transparency that means users are unable to make rate comparisons between operators. Even though rate structures are always complicated, they allow (as we will show below) some level of useful comparison to be made. Lack of information makes it harder for a competitive market to operate. A significant number of operators are “guilty” of not providing rate information. Prices are not set through some mystical process but broadly speaking come about by bringing two sets of understandings to bear. They can be cost-based: an operator looks at how much it costs to deliver the service and prices its minutes accordingly. However, no operator is an island and all of them set prices in relation to what their competitors are doing. Put simply, these are the theoretical bases for cost-based and market-based pricing. Despite the considerable number of price promotions that operators run to attract new customers, few operators seem to have a consistently applied pricing strategy designed to achieve particular commercial goals. Indeed the CEO of one leading African mobile company admitted to us that there was no overall strategy to its sales promotions. Some operators see themselves as low-price operators and others seek to maintain higher rates but faced with the realities of the market, prices seem to be retained or go down almost randomly. Although an imperfect measure, there are enough variances in ARPU between countries to lead one to suspect that operators seek to let rates stay as high as possible if there are no other downward pressures on them. The blizzard of tactical promotions often obscure the fact that there is often little price differential between operator rates, particularly in the less competitive markets. Overall, complexity of the rates on offer make it extremely difficult for consumers to make immediate comparisons between operators’ rates. Operators are also balancing a number of pricing issues. Although it is fiercely denied, the level of the wholesale interconnect rate between operators is bound to have some impact on the final retail price. Furthermore, there are intimate links between international mobile calling rates and the rates offered by fixed line operators and in the grey market. When one Nigerian operator brought international calling rates down to US16 cents a minute, both fixed and mobile operators had to drop their retail prices. The domestic calling rate comparisons given below are grouped as Off Peak and Peak rate and each covers three rates: terminating “on network”; terminating on another mobile network; and terminating on a fixed network: in each case we have taken the top and bottom ten rates out of the 150 calling plans analysed. This gives six tables of top and bottom rates each for off-peak and peak rates, looking at 20 different rates in each category analysed. This method means that 120 out of the 150 calling plans are covered by this analysis In terms of the per minute cost in different categories, the following emerged: Off-Peak – On network US0-62 cents Off-peak – Other network US0-62 cents Off-peak – Fixed network US0-83 cents Peak – On network US8-62 cents Peak – Other network US14-62 cents Peak – Fixed network US0-93 cents In order to analyse some of the patterns in the data we have arranged it into tables below of cheapest and most expensive. On the basis of the method used, any operator has a chance of appearing in 60 “slots” (6 tables of ten rates; three off-peak and three peak) for the cheapest rates and an equivalent 60 slots for the most expensive rates. On this basis, the operators offering the cheapest call plans were Orange, Millicom, One Touch, Comium and Bell Benin, whilst those offering the most expensive were Celtel, MTN, Telecel and Bell Benin. In country terms, Ghana, Senegal, Nigeria, Sierra Leone, Benin and Liberia had the cheapest call plans, whilst Cote d’Ivoire, Niger, Burkina Faso, Nigeria and Benin had the most expensive. Overall, francophone country call plans were more expensive than those found in Anglophone countries. Does market share play a part in price choices? Although numerically the largest category, almost none of the incumbent or independent-owned companies have the dominant market share in their country of operation. The exceptions are in those places where there is not yet anything approaching full competition: for example CV Movel in Cape Verde that still has a de-facto monopoly; and Guinetel in Guinea Bissau and Togo Cellulaire that have only relatively recently faced competition from another company. The only incumbents with market leadership are Gambia’s Gamcel and Mauritania’s Mauritel, which is privately owned by Vivendi’s Maroc Telecom. In 10 out of the sixteen countries under review, the three leading sub-regional mobile brands are market leaders: MTN Benin, Ghana, Liberia, Nigeria Celtel Burkina Faso, Niger and Sierra Leone Orange Cote d’Ivoire, Mali and Senegal Within these groupings, Celtel and MTN are disproportionately represented in the most expensive category. But MTN’s representation in this category is boosted by a series of relatively expensive, post-paid rates. We will be carrying out further rate analysis of mobile calling plans and will extend this analysis to other parts of the continent. If you are an operator whose calling plans were left out because they were not published, we would be happy to receive those calling plan rates and add them to the database. Please send details to: info@balancingact-africa.com If you would like to have the full data spreadsheet and the analysis based on it, buy a copy of African Telecoms and Internet Markets: Part 1: West Africa. Click on link below for details: http://www.balancingact-africa.com/publications.html
France Telecom wins Telkom Kenya stakeA consortium led by France Telecom (FT) has won a 51% stake in incumbent Telkom Kenya with a USD390 million offer, reports Reuters. ‘We got the highest bid from France Telecom…which is way above our reserve price…of USD300 million, so we are very happy,’ Kenyan Investment Secretary Esther Koimett said. FT is now expected to turn around the loss-making business and prepare it for an initial public offering (IPO) on the Nairobi Stock Exchange. Other contenders for the Telkom Kenya shareholding were Reliance Communication of India, South Africa's Telkom and LAP Fund of Libya. Many users have complained that inefficiency and corruption have made its services too expensive. Meanwhile the incumbent’s 60% holding in cellco Safaricom has been transferred to the Treasury. The stake is valued at KES64 billion (USD963.8 million). Treasury Permanent Secretary Joseph Kinyua said that the separation of Safaricom from Telkom Kenya would attract a genuine investor in Telkom who saw value in the company rather than its share in Safaricom, and at the same time allow Telkom to offer wireless services in competition with its former subsidiary. Safaricom is the largest of Kenya’s two cellcos, with close to eight million subscribers and a 75% market share at the end of September 2007. The government is in the process of preparing to offload a 25% stake in Safaricom in an IPO expected in December. (source: Telegeography) West African Telecommunication shut down in Liberia, General Manager collapsesThe General Manager of the West African Telecommunication (WAT) Gio Vannie, collapsed Monday as police officers shut down his company's operation over a frequency dispute. Although he was taken to hospital, the cause of his collapse was not established up to press time. The incident occurred when the Liberia Telecommunications Authority (LTA) ordered the immediate closure of the company's operations for allegedly undermining its authority. But, the Commercial Manager of WAT, Yafar Baikpeh, rebuffed LTA's claims saying that the action to shut down the company was illegal. He explained that the company has been cooperating with the LTA to see how best their entity could regularize its status. But the Chairman of the LTA, Albert N. Bropleh said the closure of WAT stems from the failure of the company to meet the necessary requirements for operation. "Despite all efforts and a high degree of patience exhibited to ensure that WAT meets up with all necessary requirements, it sought to deliberately undermine the LTA by operating on a frequency that has not been granted to them by the LTA," Bropleh told reporters Monday at a news conference in Monrovia. Flanked by other Commissioners of the LTA, Bropleh explained that their decision to shut down WAT was intended to protect the interest of Liberia and was in keeping with its statutory responsibilities. He pointed out that LTA is aware that WAT was granted license in 2005 by the Ministry of Posts & Telecommunications for the installation, operation, maintenance, exploitation of the telecommunications system. "The same license stressed the need for the regulator to assign to the license frequencies to facilitate the installation and operation of the fixed wireless network as part of the system," he said. According to Bropleh, WAT management was warned against rolling out in the absence of a legally issued frequency by the regulator, but has "cynically been acting in defiance of the repeated instructions and order of the LTA." Addressing journalists Monday, Baikpeh accused police officers of using sticks and other objects to abruptly shut down the generator while employees were busy working. He claimed that LTA Management had an ulterior motive to shut the company down. Baikpeh said the company would file a writ of prohibition to the Supreme Court. He contended that the management of LTA did not issue a writ from a court of competence jurisdiction to effect the closure of the company, but instead, wrote on a transmitter slip informing them that state security should liaise with their security to shut down their operation The LTA has the statutory responsibility to issue licenses and allocate frequencies, set fees for these licenses and frequencies, as well as monitor and enforce compliance by licensee with conditions of their licenses; amend, modify, suspend or revoke licenses in accordance with the Act creating the LTA. (Source: The NEWS) Seacom seizes first-mover advantage by completing financing and being ready for service by June 2009What was once the dark horse of the East African fibre race has pipped all other contenders to the post. This week it announced it had completed its financing (the majority of which is African) and that it will seize the all-important first mover advantage by being ready for service in June 2009. Prices offered to carriers for volume purchases go well below the US$500 mark. A clearly exhausted Seacom President Brian Herlihy spoke to us last week just after completing the long and arduous financing process. He dismissed the potential hurdle of the South African Department of Communication’s insistence that all fibre companies be majority South African owned:”We believe we’re in compliance. It’s a majority South African-owned company.” The US$ 650-million cable covers more than 15,000km. The investors in SEACOM are Industrial Promotion Services (25%), an arm of the Aga Khan Fund for Economic Development, Venfin Limited (25%), Herakles Telecom LLC (25%), Convergence Partners (12,5%), and the Shanduka Group (12.5%). Nedbank Capital, the investment banking arm of Nedbank Limited, was appointed as the Mandated Lead Arranger for all debt funding requirements of the project and the funding will be provided by Nedbank Capital and Investec Bank. South Africa’s new Black investors are well represented: Convergence Partners is Andile Ngcaba’s investment company and Shanduka is Cyril Ramaphosa’s. Herakles Telecom is Seacom’s vehicle for US investment in the project. On this basis, the project is 75% African-owned. Approximately half of the 18 month build period ahead will be for the production of the fibre and half for laying. According to Herlihy,”We negotiated a price and a Ready for Commercial Service date with Tyco.” It took a risk on the project by more than $10-million in the marine survey and engineering of the cable. This advance work has allowed SEACOM to maintain its ready for service date of June 2009. Actual production of the high-tech cable and undersea repeaters starts next week. Carriers already signed up include South Africa’s Neotel, India’s VSNL and Telecom Egypt. In the more open markets of Kenya and Tanzania, the company will set up its own subsidiaries and apply for licences, thus uncoupling the usual connection between carriers and the supply of international bandwidth. It will also land in Mozambique and Madagascar and arrangements here are being finalised. Its arrangement with Telecom Egypt means that it will have all of its own fibres from Johannesburg to the European landing point in Marseilles. Seacom was in conversation with the Kenyan Government about offering a co-built structure the TEAMS project but the Government decided against it because it believed it was important to have another cable for redundancy. It has spoken to NEPAD about the possibility of building a west coast cable. Herlihy is extremely bullish about demand for the project’s capacity:”Africa has the opportunity to move into the next evolution of the data wave. 3G is a data, not a voice technology.” Wireless broadband will lead to significant increases in demand over the next 3-5 years. Nitel owes two months salaries and has less than 100,000 fixed Lines in Nigeria As everyone in the industry suspected, Nitel’s claims for operational fixed lines are somewhat exaggerated. It has reported numbers between half million to just over a million. But according to a source (clearly from within the company) who spoke to News Agency of Nigeria, there are actually less than 100,000 fixed lines operational. Clearly disgruntled employees are leaking company information to show their dissatisfaction with the new owners over non-payment of salaries to senior management. September and October salaries remain unpaid. The company currently has 3,000 staff but management has announced that it will lay off 16% of them by the end of the year. If the figures quoted are to be believed, then the company revenues are in free fall. Another source claimed that prior to the sale of Nitel to Transcorp in 2006, it was making a monthly income of some N1.5b, but made an income of a mere N4.88b in the first nine months of 2007. These might be taken with a small pinch of salt as when the company was Government owned it could generate revenues often not collect them. Management had extended the probation period of all Nitel workers re-employed since the take-over by Transcorp, for another three months from Nov. 1, 2007 to Jan. 31, 2008. (Source: Leadership)
In brief:- Tanzania’s Minister for Infrastructure Development, Andrew Chenge told Parliament that the Government would write off incumbent TTCL’s debts in order to pave the way for privatisation of the company. In the meantime, Canada’s Saskatel has been acting as the managing agent for the company. According to Chenge, TTCL was seeking TSh 20.4 billion, of which TSh5.2 billion are local debts and about US$670,000 is tied up in international debts. The 2008/2009 shows that the government intends to set aside about TSh.8.2 billion to pay TTCL pensions. - Nigeria’s National Assembly looks set to start the process of reviewing the Multi-Million Dollars Rural Telephony Project embarked upon by the previous administration of Chief Olusegun Obasanjo. Despite ambitious plans, implementation has been very slow. - Telecommunication equipment was the leading import into Uganda in the first quarter of this financial year as more companies entered the market. The Uganda Revenue Authority (URA) in a report said the equipment imported between July and September was valued at sh67.3b. "In comparison with the first quarter of 2006/07, the value increased by 2,045.22% from sh3.14b," said the report. - Singapore Telecommunications (SingTel), is planning to bid for a majority stake in Ghana’s state-owned PTO Ghana Telecom, in a deal likely to be worth more than USD500 million, banking sources have told Reuters. - According to Reuters, the CEO of UAE incumbent Etisalat has expressed interest in entering the race for Tunisia’s third mobile licence. - Sudatel which won the third communication licence in Senegal has handed to the Government a cheque of US$90 million for its licence. Sudatel has also agreed to open up to 15% of the capital of the new company to local private investors. - UAE Dhabi Group has finalised an agreement making it the main investor in Celcom, the fifth mobile operator in Côte d’Ivoire. The company plans to roll out its network in the six months. - Ghana’s regulator, the National Communications Authority (NCA) is to decide how to allocate Wi-MAX spectrum. Telecoms, Rates, Offers and Coverage- In Nigeria, Globacom has announced the repackaging of its personalised ring back tune service. - Mobile operator, Movicel has expanded its coverage to the province of Kwanza Sul, West of Luanda in Angola. - Neotel, the SNO in South Africa said that a commercial consumer service launch is set for early 2008, and that it is well aware of what consumers want. - Government has decided to abolish import duty and import VAT on all mobile phones imported into the country and introduced a more effective means of taxing mobile phone usage. Consequently, Government proposes to impose a specific excise duty per minute of airtime use.
Call Centres Set to Benefit From Cheaper Bandwidth in KenyaCall centres are set to benefit from official subsidies to ease the high cost of bandwidth, helping them to compete against global rivals on an equal footing. The Sh630 million support will be channeled through the Kenya ICT Board and will benefit companies in operation that have been on a sustained growth path for at least three months. About half of the country's 50 Business Process Outsourcing (BPO) firms have applied for the subsidies which will be given out soon, board deputy chairman Victor Kyalo told Business Daily. Bandwidth in Kenya is accessed via satellite links, making it several times more expensive than in countries like South Africa and India, which use fibre optic cables. In South Africa for instance, one megabyte of bandwidth costs US$300 (KSh21,000) while in Kenya, the cheapest dedicated one megabyte of bandwidth costs $4,000 (KSh280,000). The cost is, however, expected to come down tremendously in late 2009 when the submarine fibre optic cable comes to Kenya. (The bandwidth figure reported here for South Africa seems improbably low.) BPO players estimate that fibre-optic cable can reduce bandwidth costs by 60 per cent. To qualify for the subsidy, the board requires companies to come up with proposals on how they would improve services were the cost of bandwidth at par with international prices. The level of support will be pegged on a company's ability to increase its number of employees or its infrastructure. The subsidy is likely to see many companies venturing into the sector. "There is a lot of excitement in starting outsourcing business here and more people want to get into it," said Skyweb Evans managing director Gilda Odera. The board will pay vendors the difference between the cost of bandwidth at the current market rates and what the bandwidth is likely to cost when the sub-marine cable starts to function. Popular services among Kenya's BPOs include financial services, data transcription, call centres, insurance services, and software development. An earlier estimation based on interviews on BPO players by Business Daily revealed that every month that passes without Kenya having a fibre optic cable link to the rest of the world, the country loses an opportunity to create 5,000 jobs. The board said plans are at an advanced stage to develop a technology park and an incubation park at the Kenya College of Communication and Technology (KCCT) to let companies grasp the concept before investing in it. Some institutions like the Jomo Kenyatta University of Agriculture and Technology have partnered with Wiseman Trainers to offer BPO specific courses. Industry players say Kenya is well positioned to become a preferred BPO hub because of its competitiveness in terms of human resource and local accents that are popular with the Americans and the Europeans. South Africa is still the most prefered BPO destination in Africa with at least 640 companies by end of last year. The industry has creatd at least 200,000 jobs. Research indicates that countries which do well in BPO business have efficient legal and financial infrastructure, have reliable and cheap electricity supplies, high level of domestic outsourcing and high quality of output. The entry of Safaricom as an outsourcing customer and a mobile telephone operator in Tanzania are expected to boost domestic outsourcing. (Source: Business Daily) Cape Town Residents to Get Free Internet AccessCapetonians who do not own computers or who cannot afford Internet café fees can now access both, free of charge, through the City of Cape Town's expanded Smart Cape Access Project. A public access point was opened this week in the foyer of the 44 Wale Street building. Five computers have been installed which can be used by anyone for up to forty-five minutes per day. The computers can be used to surf the Internet, and every user gets a free e-mail account. "Since we launched the Smart Cape Access Project in 2002, over one hundred thousand people have made use of the computers installed in Cape Town's public libraries," said Nirvesh Sooful, the City's chief information officer. This, he said, was the first move to expand computer access to other public buildings, so that more people could gain experience of computer use. "We hope that workers and residents in Cape Town's CBD will find this new facility useful." The city's e-governance strategy is built around three activities namely, giving people access to computers, helping them develop the skills to use them, and providing online information that is useful and relevant to local people. "Our Library Access Points and Digital Business Centres are still only reaching a small proportion of the residents of our city. "If people are to get computer experience, which is a vital skill for employment in the modern economy, then we need to build more facilities like this one," said Sooful. The computers highlight websites that feature local businesses and communities. The 44 Wale Street building, in the heart of the Cape Town CBD, opposite the Provincial Government buildings on the corner of Long Street, housed the offices of the former Cape Metropolitan Council. The building is now used by departments of the city administration. The foyer area has been converted into a large public space with information and displays covering a range of city services, as well as the Smart Cape computers. The Access Point will operate Monday - Friday, 9am - 4pm. (Source: Biz-Community) Telkom loses R192m internet connectivity deal in South AfricaTenet has announced that Internet Solutions and Neotel will collaborate to jointly provide local universities and research institutions with bandwidth and network management services for the next two years, after the expiry of its contract with Telkom, on 31 December this year. The deal with Neotel and IS is estimated to be worth R192 million over the full period, and includes the provision of connectivity to and between the 100-odd sites that form the research and education network run by Tenet, as well as layer two connectivity from IS' Bree Street facility, in Cape Town, to the UbuntuNet research and education hub, in London. Tenet is co-locating a gateway at the Bree Street facility, but this was negotiated separately and does not form part of what Tenet calls its GEN3 agreement.The GEN3 contract has been awarded to Neotel and IS following a procurement process. This involved a call for expressions of interest and a request for proposal phase, in which proposals were invited from seven operators. IS, Neotel and Telkom responded to the invitation. Representatives of the institutions that Tenet acts on behalf of were heavily involved in the procurement process, says Tenet CEO Duncan Martin. Tenet runs a national research and education network (NREN) on behalf of 40 research and educational institutions in SA and surrounding areas. It is responsible for securing connectivity and associated services for the institutions it serves, and which control it. These institutions include all 23 of SA's universities. The organisation utilised Telkom's services for its first two connectivity contracts (called Higher Education Internetworking Solution with Telkom and GEN2, respectively), both of which ran for relatively short periods (March 2001 to 31 December 2004, and January 2005 to December 2007). The procurement process this time was different, says Martin: “When we procured for the previous two contracts, there was only one game in town [Telkom], and this is no longer the case due to changes in the South African marketplace. Secondly, a worldwide movement called Research and Education Networking (REN) has taken off. “In a nutshell, at a national level, research and educational institutions get together and form an NREN, which interconnects the member institutions with as big and fat pipes as they can afford. The NREN provides them with shared services, connections to each other and to other RENs. “Tenet has, since 2000, grown into being the South African NREN, and for the first time this has seriously impacted procurement. It meant that not only did we require Net access as cheaply as possible, but we also had to meet requirements that would enable us to fulfill the function of an NREN, notably to make and fulfill interconnections with other NREN's worldwide ourselves.” Hence Tenet's procurement of layer 2 connectivity on the international circuits, and a gateway (from IS) that will be under Tenet's control and not the provider's. IS, Neotel and Tenet are in the process of finalising a tripartite agreement in which the two service providers agree to collaborate with each other in the provision of services to the universities and research institutions through Tenet. (Source: ITWeb) In brief:- According to research company BMI-TechKnowledge, the number of people with broadband internet connectivity in South Africa should climb to 3.3-million by 2012, making up 7% of the population, research has shown. That represents an annual growth rate of about 33% for the next five years, up from just 746,000 broadband users now - Technology services company AccessKenya has more than doubled its bandwidth capacity in the past 10 months to keep pace with growing demand from the corporate sector. A statement from the company said it had grown its international bandwidth to 250Mbps from 100Mbps in January giving it enough room to install three international links (uplinks) for streaming in of data from outside the country. - Coffee producers may soon have additional market opportunities as industry regulator Coffee Board of Kenya explores online connectivity to buyers abroad. In a concept dubbed e-marketing, CBK anticipates to establish linkages to speciality markets, especially in the US, beginning February through the touch of a button. - Access to the website Facebook has been blocked in Mauritius for over half a day following an order from the regulator, ICTA . According to the regulator, the website was hosting contents of defamatory nature against Prime Minister Ravin Ramgoolam. - Kenya Airways is now allowing its passengers to check-in online.
80 Percent of Computer Products Fake in East AfricaUp to 80 per cent of computer consumable products on sale in East Africa could be fake, a major regional distributor with branches in four countries has claimed. Among the most affected are the HP brand of toners and cartridges, according to Red Dot Kenya country manager Asif Saroya. Red Dot is a distributor of computers and related accessories with offices in Kenya, Uganda, Tanzania and Ethiopia. He attributed the proliferation of counterfeits to the exponential growth witnessed in the ICT sector over the past five years, which has created a rising demand that unscrupulous traders are exploiting by offering cheap substandard products - mostly from the Far East. There is a growing controversy around the world over the safety and efficacy of goods made in China, the world's fastest growing economy, which has been dogged by massive counterfeit claims. Worried that counterfeits could drive genuine products dealers out of the market, the company has come up with a series of strategies to beat the fakes. Since that fake products are usually cheaper, the company is revising its pricing to make its products more competitive and forge a closer partnership with its dealers through loyalty programmes to encourage them to stick to its brands. A massive consumer education programme has also been mounted by the company and its distributors to inform users on how to avoid fake products. (Source: The East African) East African Local Authorities plan to implement eGovernmentLocal Authorities in East Africa are planning to implement Information and Communication Technologies in an effort to increase efficiency of their operations in service delivery to the citizens. This was the message from the Regional eGovernment for Local Authorities Forum, held at in Kenya recently, writes Harry Hare. This was the first forum of its kind to be held within the region, involving local authority administrators, policy makers and ICT consultants. A total of 68 participants from Kenya, Uganda, Tanzania and the new EAC partner states of Burundi and Rwanda took part in the event that was jointly organized by the East African Community Secretariat, the Ministry of Local Government, the Directorate of eGovernment and African eDevelopment Resource Center and supported by the Canadian ePolicy Resource Centre (CePRC). The Minister for Local Government, Hon Musikari Kombo, in a speech read by the Deputy Permanent Secretary, Mr Reuben Rotich said that an investment in Information Communication Technologies (ICT) is not a competing need if it is properly integrated into mainstream development objectives and that investing in ICT will address the socio-economic issues that are crying out for development. The Minister, however, cautioned that the implementation of eGovernment projects and ICT in general should not be entrenched into old processes and therefore, automate old and inefficient procedures but find new ways of delivering efficient services using modern technological tools. “That is why the strategic deployment of ICT for improved government requires political leadership and commitment. Tackling these issues head-on, and striking the right balance between departmental autonomy and central coordination is a demanding, on-going task that has little to do with the technology itself – eGovernment is about Public Service renewal and modernization,” he continued. The workshop showcased some of the successful implementations of eGovernment at the local authorities. From Kenya, these were Nyeri and Mavoko Municipalities, which have implemented LAIFOMS, a Local Authority Integrated Financial Operations Management Systems, a system that will be rolled out to 60 other local authorities by 2009. Kinondoni Municipality in Dar es Salaam Tanzania took the focus regionally. They have successfully implemented eGovernment systems including: Geographical Information System, Education Management Information System, Loan Master and a Health Information Management System. Internationally, Korea took centre stage with their KONEPS (Korea Online eProcurement System) application which has won a number of awards including best procurement practice model awarded by UN in November, 2004. In addition, Seoul was jointly ranked number 1 among 100 largest cities in the world due to its eGovernment practices, by the UN Division for Public Administration and Development Management and the American Society for Public Administration. “One of the aims of the conference was to make eGovernment an attainable reality amongst our regional local authorities. Not only to enable Local Authorities to become a more efficient machinery, but also to ensure satisfaction among the citizens,” said Harry Hare, the Executive Director of African eDevelopment Resource Centre, who were responsible for putting the workshop content together. During the closing of the Forum a multi-stakeholder approach in implementing eGovernment was encouraged. The meeting made resolutions and urged for their implementation. These included the need for the EAC Secretariat to support the articulation of a regional framework for e-government at local authority level; Partner States work to structure independent ministries or regulatory bodies that deal exclusively with ICT Development and e Government projects; Ministries Responsible for Local Governments budget for the implementation of e-Government in all local authorities; and Private sector provides technical assistance and training along with the provision of relevant technological solutions to governments. ICT Bill in Offing in RwandaA bill to regulate the fast growing communications sector in the country is in pipeline, Eng Albert Butare, State minister for Energy and Communication has said. "Sectors like internet governance, issues of electronic communication or telecommunication, postal services, broadcast have their laws, but they have to be considered in the ICT Bill," Butare said. If it becomes law, high quality communication services would be provided and rights of service users will be ensured. The Director General National Post Corporation Celestin Kayitare said that if the bill is passed, it will help postal providers in the country provide good and efficient services. He was however quick to say Post Office-Rwanda is currently facing stiff competition from unregistered courier companies. "Transport companies like Atraco, Volcano and others are doing the business of sending letters and other courier work which is our traditional business," he cited. The bill also provides possibility of opening up of the postal services to competition. But this will be in a gradual and controlled way while ensuring universal service. (Source: The New Times) In brief:- Nigeria's Federal Capital Territory Administration and the Intel e-learning are adapting a 10 million dollar-library digital content to the Nigerian secondary school curriculum to be made freely available to students and teachers on the internet. - A computer hitch at the Kenyan-Ugandan border of Malaba has caused a huge traffic jam that stretches for 15 kilometers. According to reliable sources, computers at the Ugandan side of the border were infected with a virus that subsequently slowed down the process of clearing heavy trucks at the border. - Nigeria’s computer manufacter, Omatek Computers Limited has released two new products into the Ghanaian market. The 8" and 10" Notebook are among the smallest notebooks in the world along with those produced by Sony. - Google has announced that it will offer $10m in cash prizes for innovative developers of open mobile solutions based on Android. Android Developer Challenge I: submissions to be made from January 2, 2008 through March 3, 2008, with the 50 most promising entries being recognised by the end of March and each receiving $25,000 to fund further development. Android Developer Challenge II: open until May 1, 2008 to successful awardees under Challenge I, who would be eligible for ten awards worth $275,000 each and another ten worth $100,000 each. - The Bank of Ghana is establishing a National Switch, the E-ZWICH, to allow the establishment of a common platform for all payments transactions, both on-line and off-line, in the country. Associated with the E-ZWICH is a biometric smartcard that eliminates the need to have basic literacy and numeracy to operate a bank account since it relies on the identification features of finger prints. The E-ZWICH is a major vehicle for financial inclusion. The smartcard can also be used for payment of wages to workers on the government payroll. The use of the biometric identification system will remove ghost workers on the public payroll. The National Switch and smartcard project would serve as the vehicle to transform Ghana from a predominantly cash economy to one dominated by electronic transactions using modern state of the art technology.
MTN to Invest $350m in UgandaMTN Group President and CEO Phuthuma Nhleko visited the country recently. Paul Busharizi talked to him about MTN's challenges in Uganda and their future plans. What is your impression of your Ugandan operations? I think the Uganda operation is doing very well.We are talking about an operation that is growing by 35% in terms of subscriber base after nine years in business penetration has increased significantly. When we came in, it was 0.2% but now it is about 14%. We have seen the highest growth in the past but growth is still very strong. Uganda is nine years old as an operation for us. Iran is achieving growth of 88% but it is coming off a very low base. On the continent, Uganda is still one of our strongest growers. Nigeria is growing 52% but we have only been there for five years. Do returns on investment justify more investment into the country? It is still justifiable to keep injecting capital on condition that regulatory environment is clear and certain, which in our view is the Communications Bill, which has not been promulgated as yet. That is crucial. but the will to invest more is there. We have invested $50m this financial year and the intention is to invest another $100m and if our five-year plan holds, up we could invest $350m but this is subject to the regulatory environment, which is subject to the Communications Bill being passed. So you have issues with the new more competitive environment? What we are saying is that for the Government to bring in more competition is par for the course. It further stimulates the market but because we have five players now, we need the Bill to be passed. It will take any ad-hoc subjective ruling on competition issues out, level the playing field and give certainty for us as industry players as to what we can expect. That certainty provides confidence to invest without fear of arbitrary rulings that would hurt investment. How much more growth can be squeezed out of this market? 14% penetration is still relatively low. We think that penetration can be higher; there is no reason why we can't achieve 20-25%. The bottom line is teledensity and increased penetration has always surprised on the upside and we expect tale-density to keep increasing here too. Do increases in excise duty on airtime concern you? It is a concern. A recent Deloitte report showed that Uganda is one of the highest taxed mobile sectors in the emerging markets. We agree the telecoms tend to be an easy target for revenue mobilisation, but we do believe it should not be done at the cost of mortgaging the rate of penetration of telecoms which has an effect on the economy. The more you tax the less investment possible the less the rate of increased penetration. Recent results have shown a decline in revenues per subscriber, isn't this worrying you? Average revenue per unit going down is a certainty, as your penetration deepens you are hitting segments of people who can afford less and less, further our tariffs have not stayed the same. In fact, we have lowered them. What can the Ugandan consumer look forward to? We have been largely only in mobile voice but there is a whole range of value-added services that we still need to deal with; mobile banking, mobile television. MTN suffered network problems lately. Is there any truth that you are under-investing here and shifting resources to your more profitable Nigerian operation? That is just an urban legend. We have a meticulous budgeting process for every operation. Our recent problems in Uganda have nothing to do with other operations. When we reduced tariffs, demand increased but much faster than we could increase capacity. In 2008, we plan huge capital expenditure for Uganda. You can't always get it right but rest assured Uganda's problems have nothing to do with Nigeria. Any possibility of your Ugandan unit selling shares in the stock exchange? We intend to take it in steps. We have invited some pension funds to invest in us. We can't rule out eventual listing of our shares. (Source: New Vision) Portugal Telecom to Sell More of Africa Holding; To Keep Majority StakePortugal Telecom plans to sell a further stake in its Africa Holding, but wants to keep a controlling position, deputy Chief Operating Officer Zeinal Bava said Wednesday on the company's earnings conference call. Bava, who becomes the new CEO in 2008, didn't elaborate on the timing of such a sale. PT already sold 22% of its Africa Holding to African equity fund Helios Investment Partners LLP for EUR125 million in August. PT, which is already active in Angola, Namibia, Cape Verde, and Sao Tome, is seeking to enter markets such as South Africa, Nigeria, Congo, Tanzania and Kenya. In an interview with Dow Jones Newswires in September, the director for international investments Jose Pedro Baptista said Africa is PT's second main expansion target after Brazil. (Source: Dow Jones Newswires) African Drive Pays Dividends for ACTowersBuyoant conditions in the cellular market and the eager pursuit of opportunities in Africa have paid off spectacularly for African Cellular Towers (ACTowers), which constructs cellular masts and exports them. In the six months to August, the AltX-listed company's sales grew 148% to R176,1m, supported by greater production capacity and the inclusion of JK Shelters, which it bought in March. Earnings before interest, tax, depreciation and amortisation (Ebitda) rose 116% to R39.5m. Ebitda margins, however, declined to 22.3% (from the previous corresponding period's 25.6%), mainly because of a reduction in exchange profits. Headline earnings were up 40% to 11.3c per share, compared with 8,1c per share previously. ACTowers operates in 28 African countries. The company said demand for installation of cellular towers exceeded its expectations, and it secured new contracts in Madagascar, Republic of Congo and Chad. Growth was set to rise sharply with a plant in Ghana's free zone expected to become operational by next April. ACTowers will occupy the zone as soon as infrastructure services are completed. This is the first large firm to set up shop in the Ghana free zone -- akin to Dubai's famous free zones -- and it negotiated favourable terms with Ghana's government, including a five-year tax holiday. Ghana is a member of the Economic Community of West African States, so the plant will give ACTowers a springboard into that region, chairman and MD Chris Kruger said. He expected growth of up to 20% in the first year, and further increases as the company expanded its footprint in the region. (Source: Business Day) Nigeria’s Federal Government to sell shares in Galaxy BackbonePlans are underway by the Federal Government to sell stakes in Galaxy Backbone Plc, but Government will still retain a strategic hold on the government-owned infrastructure service provider for security and national interest reasons, according to CEO of the company, Gerald Ilukwe. Set up as a partnership between government and private sector by the administration of ex-President Olusegun Obasanjo, Galaxy Backbone Plc is owned 51 per cent by the Federal Government and the Jigawa State Government and 49 per cent by private stakeholders. Jigawa's stake comes from its assets and consideration of the state-government owned Galaxy Information Technology and Telecommunications Limited. Ilukwe who dropped the hint weekend during a media briefing when officials of the company gave an update on its activities saying Galaxy Backbone is on track in its mandate in key areas including building and managing a consolidated government network using available infrastructure to provide transversal services and solutions to the Government; extending its expertise to the private sector by offering superior services and solutions at competitive prices and realizing one of the Millennium Development Goals of breaking frontiers by bridging the digital divide and providing access and relevant solutions to provincial communities. Additionally, the company was also set up to ensure a secure communication platform for the public sector by building and operating a single nation-wide IP (internet protocol) broadband network to provide network services to all Federal Government ministries, departments and agencies. "If you tried to sell Galaxy when it was registered, how much will you get for it? What does it mean to anybody? It's a paper company. Galaxy acquires value, shows proof of ability and within the shortest possible time, in fact we are somewhere behind in terms of timeline because we have not moved as fast as expected, we will begin to actually sell our shares", he added. He adds that the company would evolve into a public-private-partnership (PPP) in which "Government expects to sell a significant amount of shares in this company. Government will not privatise the entire company because it is a provider of services to government and therefore government has to maintain a certain shareholding for security and national interest reasons." Iluwke explains that the setting up of the company "was not just somebody's flight of fancy" as it was borne out of the recommendation of a Technical Committee on Harmonisation of ICT Initiatives which specifically sought the creation of a National Infrastructure Backbone. According to the report, against the backdrop of diverse public sector IT initiatives and the need to optimise their cost and functional benefits to the government and people of Nigeria, there was a need to harmonise ICT initiatives in government."Following that need and the second reason was the fact that and still remains a valid fact is that a lot of the places that this backbone is going to go, Nigeria's borders have remained relatively unchanged except for Bakassi for how many years, is that the private sector would not have found those locations viable. So they would not have invested. But those locations all fall within Nigeria and all fall within the purview of government to ensure uniform development across the nation because the digital divide does not only exist among nations but it exists within nations", he adds.Galaxy Backbone says it has built an installed and available capacity of 30 terabytes to support storage for the public and private sector and build a national backbone to particularly serve rural communities.Adding further, Chief Marketing Officer, Galaxy Backbone, Yusuf Kazaure, says beyond public sector agencies, the company has been receiving requests from private sector end users and service providers to co-locate their facility within its data storage centre.Explaining further, Kazaure says, "one of our mandates, one of the core reasons for being set up, according to the report of the technical committee on the harmonisation of government ICT initiatives, we are supposed to take over, part of the assets used to set up Galaxy Backbone are existing infrastructure and connectivity infrastructure owned by various different government agencies, departments and initiatives as well and ongoing initiatives." So, by that fact, it means government has decided to cede off that aspect of its asset to Galaxy Backbone, so there is a vacuum now created within government immediately by doing that. So we are supposed to take over those assets, integrate them, harmonise them together with the new initiatives and come back to government. So they are not being serviced technically by doing this unless we come to the fore to do this. So when you look at it from this point of view, you'll see that we are best placed technically and best placed to be able to address that need."The company says it has bandwidth (transmission capacity) to service needs for Internet access via VSAT and is also procuring capacity off the SAT-3 submarine optical fibre link managed locally by NITEL to be able to retail SAT-3 for government."And again, these are services you procure on the basis of need and within our capability to be able to for instance put in a fibre connection between yourself and NITEL which is the sole provider of SAT-3. And that is upgradable to typical STM-1 which is like 155 Megabit capacity that would service the needs and then as we begin to bring people on board, we can scale smoothly to meet the needs. And then, all that as well is driven by our plans to have a substantive network operating centre and a local teleport where the facilities that you have seen will defer to more like a disaster recovery business continuity site.So, it is all in our growth plan and business model to be service provider to government and being able to leverage a national backbone network to serve rural communities and so on", says Innocent Ngogbehei of the Technical Services Division of Galaxy Backbone. Against the backdrop of plans by NITDA, the National IT Implementing Agency, to roll out 100 ATMs, which analysts reckon is within the mandate of Galaxy Backbone, its CEO says , "I am not in a position to comment on stories that come out of the pages of newspapers knowing that the DG of NITDA was Chairman of the recently dissolved Board of Galaxy Backbone and is aware of the mandate of Galaxy Backbone and if there are any differences in opinion, they are not official. I am sure he is responsible enough not to do anything that will contravene the mandate of Galaxy Backbone." According to Ilukwe, "But like I said, it is just something I read just like you read it. I was not there when they signed this MoU to roll ATMs. There is a simple way we also put it: it's a government infrastructure. If NITDA decides to roll out or to be involved in the rollout of infrastructure, we also have to understand the limits of our own mandate, if NITDA got involved with a bank in the rolling out infrastructure with the bank's money, it's really not anybody's business. But insofar as NITDA, I believe I understand them or the mandate, is that Galaxy Backbone is responsible for rolling out all government infrastructure. If what NITDA is doing is true, as reported in the papers, is outside of the framework of government, I guess I am not in a position to be telling them what to do. But if it is within the framework of government, then it has to be in compliance with the mandate. But again, it is just an MoU and MoUs are not what people tend to lose sleep over but then there have been MoUs that have not seen the light of the day." (Source: This Day) In brief:- Telkom South Africa says it expects first-half earnings per share (EPS) to fall by between 14% and 20% compared to 1H 2006. The firm says earnings are being hit by aggressive competition, which includes the bundling of voice and data products, and increased investments.
South Africa: Mobile a Serious Challenge for Internet PublishersIt was bad enough for web publishing when the challenge was to persuade marketers to move money from 'old fashioned' magazines and radio to the 'new and trendy' Internet. Now there's something newer and trendier! The success of MXit has been phenomenal. The instant messaging service available via cellphones has more than three million subscribers in South Africa. This Stellenbosch-born business already has half a million international subscribers and is poised for rapid growth in the India and the UK. MXit isn't going to have it all its own way in South Africa. Vodacom has launched The Grid - or so they tell me. I'm not in my teens so I'm not the target market. The launch has been low key, utilising the viral element that worked so well for MXit. Each subscriber to the service will invite an average of 20 friends. Each of them will invite another 20. The network effect doing its magic. I first heard about MXit during a lunch conversation with a group of friends. My children are too young to have cellphones, but some of the other parents present were used to spending thousands per month on their children's cellphone bills. They were big MXit fans because it brought down the monthly cost drastically. And MXit is more than just instant text messaging. When subscribers logon they view an advertising screen, which they apparently enjoy. MXit boss Paul Stemmet told the Reshaping Media conference that if subscribers don't get their advert when they logon, they call the helpdesk to ask where it is. If that's more than just an occasional occurrence it's quite extraordinary. Mobile content providers are now producing audio and video content for viewing on cellphones - funded by advertising and sponsorship. The age of users is also important. The vast majority are in their teens of early 20s. As they grow up they are likely to stick to the habits of their youth. Vodacom has joined the Online Publishers Association and is aggressively rolling out an advertising model to bolster revenues. Figures presented by Vodacom's Graunt Kruger show that its websites reach 1.4 million South African subscribers each month - a greater domestic audience than previous local leader news24.com. Where does this leave web publishing? Looking a bit dated and unable to match the reach of some of the mobile services. It was bad enough when the challenge was to persuade marketers to move money from 'old fashioned' magazines and radio to the 'new and trendy' Internet. Now there's something newer and trendier! The challenge for website publishers is to harness mobile to support their current offerings. The next step has to be to position website publishing to demonstrate its strengths. But how best to do this? (Source: Biz-Community) Federal Government to Launch SMS-Based Public Enquiry Service in NigeriaThe Federal Government in a bid to ensure adequate and responsive service delivery to Nigerians, is set to launch an SMS based public enquiry, comment and polling service that will now make it possible for all Nigerians to participate directly in nation building by sending useful opinions and comments from their mobile phones nationwide. The FG is collaborating with Private Networks Nigeria Ltd PNN, an NCC licensed telecommunications company according to its CEO, Abdulraman Adeola-Odunowo to provide the service aimed at providing Nigerians with the opportunity of acquiring information directly from government on government policies and actions. As part of the take off of the service which begins on Tuesday, the Minister of State for Information and Communi-cation, Alhaji Ibrahim Dasuki will on November 13, be participating in the testing of the Enquiry service. "Members of the public are encouraged to send their enquiries from any of the networks to the short code 33501 for the opportunity to obtain answers to their questions directly from the Honourable Minister. "Enquiry is a service that will make it possible for any Nigerian who owns a mobile phone and can use Short Message Service (SMS), to request information on aspects of government policy that they might need quick clarification on. Typically, interested public will compose requests/ enquiries/comments and send via SMS to 33501 from their phone." The subscriber will receive an acknowledgement of receipt of the SMS and the dedicated ministry's information officers will then respond as soon as possible. Being a Private Public initiative, each SMS will cost N50. PNN is a private telecommunications company set up to provide various telecoms services in the telecommunications sector. It is actively involved in various aspects of the development of telecommunications in Nigeria, including the distribution of telecoms products, supply and installation of telecoms equipment, operations and maintenance of GSM and PTO facilities and provision of engineering support services and value added services. Mrs Ibukun Odusote, the Head of IT of the FMIC confirmed that Government has been developing this solution in collaboration with PNN for over 18 months since it was becoming a major way of communicating amongst Nigerians because 40 million Nigerians now use mobile phones. Nigerians are therefore encouraged to partner with Government by taking full advantage of the technology by participating in the pilot programme from Tuesday. (Source: This Day)
Events- 3RD AFRICAN OUTSOURCING & CONTACT CENTRE CONFERENCE 27th – 28th November 2007, Safari Park Hotel, Nairobi, Kenya This conference and exhibition provides a business networking platform for the entire regions outsourcing industry. This is a unique opportunity for companies looking for outsourced services to meet operators in this emerging outsource destination as well as for local operators to learn about international trends, best practices and business opportunities. For further information visit www.aitecafrica.com - 3rd WEST AFRICA SATELLITE COMMUNICATIONS SUMMIT (WASCS3) 20-21 November 2007, Protea Hotel, Oakwood Park, Lagos, Nigeria WASCS3 will focus-in on the latest developments in the evolutionary deployment of satellite broadband networking to serve the leading commercial and enterprise verticals of the region. The Summit programme focuses on such leading regional verticals as the oil & gas industry, the banking & wider financial sector, and distribution & enterprise, both the Summit discussions – and the provision of practical VSAT installation training – will be supportive of the these wider national, regional and continental satellite connectivity requirements. For further information visit www.gvf.org or contact martin.jarrold@gvf.org in the UK office. - MED-IT@DAKAR 2007 4-5 December 2007, Hotel Méridien Président, Dakar, Senegal 3rd B2B exhibition specialised in IT. Exhibition, conferences and business rendez-vous in order to establish strategic partnerships between French, North African and Senegalese IT professionnals Visit our web site : http://www.medit.eu.org - 3rd REGIONAL WORKSHOP ON MEDIAS AND ICT ISSUES IN WEST AFRICA 13-15 december 2007, Dakar, Senegal The workshop entitled “new journalism, new technologies, improved governance” will aim at promoting uses of blogs and new ICT tools by medias for improved governance in West Africa and strengthening reporting on ICT in the region. For further information on the workshop please contact Judith Lenti jlenti@panos-ao.org or Ken Lohento contact@cipaco.org at PIWA. - ICT AFRICA 13-15 February 2008, Addis Ababa, Ethiopia CT Africa 2008 offers: A Plenary session featuring policy makers, Business leaders and key ICT research leaders High quality, peer reviewed technical presentations Technical tutorials on emerging ICT technologies Workshops on ongoing projects Industry exhibition For further information contact visit http://ictafrica.nepadcouncil.org/ Jobs and Opportunities* Chief Commercial Officer - Sudan A Chief Commercial Officer is required in Sudan to join Telecom Operator on a permanent basis. Qualifications required: - Bachelors Degree in Sales, Marketing or Business. Preferably holding MBA. - A minimum of 15 years related experience with progressive managerial responsibilities, preferably in a telecom field. - Demonstrated in-depth Marketing, Sales and Customer Services techniques and financial principles. - Effective ability to communicate orally or in written form effectively with co-management, internal and external customers. For further information contact advertising@balancingact-africa.com * 18 GRANTS TO SUPPORT JOURNALIST PARTICIPATION TO WORKSHOP The Panos Institute West Africa (PIWA) through its “Uses and Policies of Digital Technology” Programme (ICT Programme), will organize on December 13th to 15th, 2007, in Dakar, Senegal, a workshop entitled “3rd Regional workshop on Medias and ICT issues in West Africa : New journalism, new technologies, improved governance”. To enlarge participation in the workshop, PIWA will provide 18 grants for participation for selected African journalists. Priority will be given to journalists from English speaking countries and to radio journalists. For further information visit http://www.panos.ao Contracts* Sonatel and Ascade - Senegal Senegal's national telecommunications operator, Sonatel SA has selected Ascade's Carrier Cockpit (TM) suite to optimize and automate all aspects of its global interconnect business. * KDN and Nokia Siemens Networks - Kenya Kenya Data Networks, a local provider of telecommunications infrastructure, has partnered with Nokia Siemens Networks to roll out a land-based fibre optic link for at a cost of Sh7 billion. The programme has been split into two projects; metropolitan and backbone. The metropolitan project will target Eldoret, Kisumu, Nakuru, Naivasha, Thika and Voi towns at a cost of Sh330 million. The backbone project, stretching from Mombasa to Malaba in a circuit to Busia, Nakuru and the Mt Kenya region and on to Garissa and Malindi, will cost Sh6.6 billion. * SA Revenue Service and Dimension Data – South Africa Dimension Data has triumphed over Telkom in a bid to supply telecommunications services to the tax department. The company has won a large chunk of a technology tender from the South African Revenue Service (SARS) valued at R1,5bn over three years. * Hotspot Business Solutions and Redline Communications - Tanzania Redline Communications has won a contract to supply Tanzania-based telecoms provider Hotspot Business Solutions with the country’s first national WiMAX network. Redline will supply the operator with its RedMAX products, enabling Hotspot to deliver high-quality voice, video and data internet services across the country, via its six-city WiMAX network.
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