Sudan special – oil fuels rapid growth in telecoms and internet sectors

Sudan is Africa’s largest country but more than 70% of its population live in its small towns and scattered across rural areas. The country sits strategically between Arabic-speaking North Africa and the Gulf and several sub-Saharan African countries: it is bordered by no less than 12 countries. The civil war in the south of country raged for over 20 years but now seems to be at and but troubles persist in the west of the country. Its oil revenues have created a building boom in the capital and attracted telecoms investment from the UAE (Canartel) and Kuwait (Celtel).

So despite the continuing American sanctions, international investors are interested in what one person described as “the smell of money.” Some idea of the scale of money to be made can be gained from a story told to us of an ISP with only 6 clients which is making millions of dollars profits: all the clients were oil companies.

US sanctions means that the military government has put in place a programme it controls for local assembly of things as diverse as copper wire, cars, computers and lorries. And well-known international brands like Hyundai (producing the parts and expertise to produce the local GIAD car) are closely involved in this process.

The peace with South seems to be holding on the basis that “the details” are not being worked out. Whilst one mobile operator from the North is beginning to roll-out in the South, the Southern Government is planning to introduce a new “national” operator into its area and went to the ITU to ask for a separate numbering scheme. If the South’s new operator conflicts with existing licences from NTC, how will this be resolved? Will that new Southern Sudan operator be able to go north and operate there? Nobody seems sure although the two sides are talking to each other. When Southern Sudan’s Minister of Communications in Juba has an office with no electricity, it’s fair to say that these things will take a while to sort out.

INCUMBENT SUDATEL FACES NEW COMPETITION FROM SNO CANARTEL

There are four main operators: Canartel, Sudatel, Areeba and Mobitel. The latter two are GSM mobile operators and are described in the section below. The incumbent Sudatel is now a public company quoted on the Dubai and Khartoum stock exchanges. The Government still has 26% of Sudatel but is likely to sell this. Two of the key local shareholders are the Dal Group (a local company that has the agency for Mitsubishi and Coca Cola) and Advanced Technologies (which among other things does copper wire assembly and GIAD car assembly).

Sudatel is seen by other operators as having a good fibre network and it extends to most of the main centres in the country (including Al Fasher in the west) and internationally to Egypt and Saudi Arabia. Its international fibre connections mean that it is buying international bandwidth at between US$1-2,000 per mbps per month.

Because it borders so many countries and is connected to the Middle East, it would like to develop a role as a regional hub and is going to be one of the bigger investors in the EASSy project. (We also heard that Canartel are interested in investing). However the existing fibre route south stops short of the country’s southern border Kadugli because of the civil war. If the peace holds, it will now be extended down into Uganda and another route will connect up to Ethiopia. At the end of this process, it will have three or more international connections. Both mobile operators (Mobitel and Areeba) use its backbone network but Mobitel has said that it will build its own unless interconnect prices fall (see below).

Meanwhile the regulator is trying to persuade the National Electricity Corporation (which has 3,000 kms of fibre) and some locally-owned oil companies to “outsource” this capacity to existing licence holders so that they can sell it to others.

However Sudatel’s former management,  like quite a lot of former incumbents, were engineers and are not good at marketing this capacity to other operators. Although the new CEO of Sudatel (who was formerly the Chair of Mobitel and used to work for GIAD) is credited with having vision, he will have to move quickly if this lack of marketing is not to become SNO Canartel’s opportunity.

Sudatel depends heavily on voice whereas newcomer Canartel has a strong emphasis on data. This is much needed in the business sector that will look to it for VPNs and Internet access. It will offer fibre to the office and wants to do IP-TV to the home in the medium to long term. It sees this as having huge market potential. But for two years at least it will probably rely on Sudatel’s backbone infrastructure.

In order to stay in the game, Sudatel has put together a CDMA voice and data service called Sudani which it publicly announced before it had sorted out a licence for it. The regulator NTC has now given it a vertically-defined, “unified” licence which means that it can offer all services including mobile at a cost of $230 million. Since Canartel paid US$53.7 million for a licence that excluded mobiles, the value of the mobile element can be read from a sum akin to the difference between these two licence prices.

The big four operators are the only ones allowed to operate international gateways. ISPs have to buy their international bandwidth through these companies.

Sudatel has a fixed line capacity of 2 million but currently only has 1.1 million active subscribers. This number is decreasing and once disconnected, subscribers hardly ever reconnect. In one instance there is a switch that has capacity for 50,000 users that is only used by 4 subscribers.

The regulator NTC has stopped cross-subsidy in tariff regimes and there are now only two tariffs: national and international. The rationale for the national tariff is that if all the backbone is fibre and soon most of the calls will be IP-based, then distance should not be seen as a factor for charging.

Sudatel is hoping to have gone over to a packet-switched network by next year. It is also trying to set up a fibre-based metropolitan area network in Khartoum using Huawei as the vendor. But informed sources say that the interfacing on the network has not been good and as a result the company are now going back to Siemens,

THE SNO Canartel is setting up a completely IP-based network using CDMA and is offering both voice and data. The offer is what is described as fixed mobile which means that subscribers can use their phone within only one cell in the network (up to 1.5 kms). The handover protocol is disabled. Since Etisalat missed getting the second mobile licence, insiders believe that it will either seek to buy out Areeba or purchase a unified licence based on whichever turns out to be cheaper. Whichever way it goes, it will simply have to activate the handover protocol and its fixed mobile subscribers will become mobile subscribers. Thus technology developments are already making a nonsense of service licences based on technologies.

Canartel has in its first month already attracted 18,000 subscribers. Industry sources say that it is experiencing problems with network coverage and CDMA handset supply. Whilst the company is keen to emphasise that it is quality and service that it’s selling, it is cheaper than the incumbent’s fixed offer and adds in limited mobility: approximately 3 dinars against 4 dinars. However, according to the regulator, when monthly charges are included, the costs per minute are identical.

Nevertheless these fixed prices compare very favourably with the mobile operators whose average per minute price is 26 dinars a minute, a shade over five times the fixed price. And those of you who think mobile prices in Africa are too high, might ponder what the market would look like if existing mobile operators had to compete at this “fixed mobile” price level.

The regulator NTC has a Universal Service Fund and there is a five year plan to build 2,500 Knowledge Centres and 5,000 computer labs in schools.

SUDAN GOES FROM TWO TO FOUR MOBILE OPERATORS WITH NEW UNIFIED LICENCES

There are two mobile operators: Areeba and Mobitel. Celtel recently bought Mobitel at a price that is widely acknowledged to have been a high one at US$1.23 billion. The valuation was made on the basis that each subscriber was worth US$1000 at the time of sale. Areeba Sudan is owned by the Lebanese-owned Investcom but 50% of the operation is in the hands of a Sudanese company called Larrycom.

There are just over 2 million mobile subscribers. Areeba started in July 2005 and has 350,000 subscribers. Mobitel says it has 1.92 million subscribers. Estimates of overall potential vary between 4-5 million subscribers by the end of 2005 to around 8 million in the longer term. Mobitel plans to get to 5 million by 2008.

75% of the customers are in the capital with the majority of the balance to be found in the state capitals. There are 12 million people in the Greater Khartoum area out of a population of 34 million people. At present Areeba’s network covers 29% of the population. Industry sources say that it is suffering coverage problems: these include “holes” in the Khartoum area and lack of extensive coverage outside the Greater Khartoum area.

The two main price differences between Areeba and Mobitel according to former are that Mobitel charges a three monthly fee of US$10 irrespective of use to pre-paid customers and Mobitel has per minute billing against Areeba’s per second billing.

However on the basis of these two price differences, Mobitel’s ARPU is $17 against Areeba’s $10. However once per second billing gets established, it rarely goes away so Mobitel is vulnerable in this area as it makes up about 20% of their income.

On interconnect between mobile operators, each pays 14 dinars a minute. The SNO Kanartel pays Areeba 9 dinars a minute and receives 8 dinars a minute. Sudatel gets 9 dinars a minute for calls it receives and 9 dinars for calls sent to Areeba. It has argued successfully with the regulator to prevent the lowering of the amount it gets for calls sent. Last year Mobitel was fined US$1 million by the regulator for an interconnection issue involving network congestion.

At the retail level, Areeba is much cheaper for calls made to its own network subscribers: 16 dinars against Mobitel’s 32 dinars per minute. Connecting to a subscriber on another network costs 28 dinars per minute for both networks.

Mobitel is planning low-cost packages for students, teachers and low-income groups. These will include reduced prices on SMS and MMS and a special tariff on voice.

Areeba operates its own international gateway and buys capacity from a number of international suppliers of which the largest is Monaco-based Midnet. As Satti tells it:”We have had more international traffic than we had in our business plan.”

Mobitel will launch its GPRS service in June 2006 and is currently trialling it for free with post-paid subscribers. The vendor is Ericsson. Coverage will be in the Khartoum area initially and then in the regions. It will offer specific packages for large corporate users who want “internet in the field”. It will offer it on a cost per kilobyte but the price is likely to be lower than existing ISP prices.

Areeba is just on the point of launching GPRS and is testing a 3G network: both upgrades have Alcatel as the main vendor. The offer on GPRS for post-paid subscribers will not be a monthly subscription but per amount of capacity used. Pre-pay subscribers will pay a one-off activation fee plus again capacity usage. Like SMS which are already very popular, MMS will charged on a per message basis. It is expecting to have somewhere between 25-30,000 regular users in the medium-term. 3G will probably be launched on the basis of a free trial to post-paid users.

Mobitel is slightly further ahead of its rival with value-added services, drawing 4% of its revenue from this source. It has ring-tones and SMS News. The latter is supplied by Al-Jazeera and SUNA and has 50,000 users. An SMS banking service will be launched next week and it will then move on to introduce a mobile payment system. It estimates that there are 200,000 potential users for the latter service based on a survey it conducted amongst its own users.

Interestingly Siddiq Ibrahim, head of the regulator NTC told us that Sudanese were already using their mobiles for money transfer. For example, someone in Khartoum would send a relative credit for minutes to a relative in Port Sudan. This relative would then go to a tele-kiosk that would turn this mobile minutes credit into cash. According a recent investigation by the regulator, US$25 million worth of minutes are transferred by SMS.

Currently Areeba does not offer mobile content but is installing a platform to do so and looking at local, regional and international third party content providers whose proposals respond to local Sudanese culture. First offerings are likely to be in the areas of sport and entertainment.

Areeba is just starting to roll-out its network in Southern Sudan. But as Satti says:”There are tremendous problems of infrastructure, both in the South and in the rest of the country outside the main urban areas”. Each base station in the South has been put up on the basis that it will work on its stand-by generator, drawing down mains electricity if it’s available.

Is the market big enough for four “unified licence” operators?. Areeba’s Deputy Managing Director Ghada Satti worried is not worried by this prospect:”The telecoms market is booming. It can take all the new players just to provide basic services. We are talking about an overall penetration rate of 6%. There is need for everyone to be here.” Likewise Mobitel’s Product Development Manager Musab Osman seems undaunted by increased competition:”The market is wide open and there is huge potential. The market can easily contain all four operators.”

The regulator NTC has plans to introduce number portability.

SUDATEL’S UNWILLINGNESS TO WHOLESALE BROADBAND MAY SPELL END FOR INDEPENDENT ISPs

The internet market is dominated by Sudatel as it was in the beginning the only company allowed to offer an ISP service. Indeed the growth of the first ISPs remains tangled up in its somewhat unfocused commercial Internet strategy. It bought a shareholding in an ISP called Sudanet and before Mobitel was sold to Celtel, it owned an interest in a third ISP, Mobinet. However it suffered big losses on Sudanet when it implemented a “loans for computers” scheme as it was unable to collect the outstanding loans effectively. But despite this setback, it controls more than 70% of the market, which two years ago had around 300,000 subscribers. Mobinet currently claims 90,000 subscribers.

There is currently a working group of ISPs looking at setting up an ISP association but no work is currently being done on setting up a local IXP.

Until October 2005 all ISPs shared the monopoly incumbent’s international gateway and service suffered because the incumbent gave priority to its international voice business.

With liberalisation, there will now be three “big players” moving into the Internet space: Areeba, Mobitel and Canartel. All of which does not leave a lot space for the other 22 ISPs in the market; 19 of whom offer dial-up and three wireless access. Most of these ISPs are small and with the arrival of broadband, some level of consolidation looks inevitable.

In these circumstances, wireless access should have taken off as the alternative challenger to the incumbent. One of the largest operators ICOM launched in 2003 with a proprietary point-to-point system. Initially it attracted a lot of customers but because of high levels of contention, customers were unhappy with download speeds. Apparently a single base station only delivered 4 mbs of capacity. In addition, there were problems with customer aerials getting out of alignment when there were high winds. As one insider told us:”The image of wireless access has been very badly damaged by this experience.”

E-Sharaf has a Wi-Max licence but it is only achieving 7-5 kms on point-to-multipoint connections. Zinanet also offers broadband wireless. Interestingly Mobitel has been using Wi-Max as a substitute for for more traditional mobile networking.

The other issue has been pricing as the service is expensive. One provider charges 400,000 dinars for the equipment needed and between 5-600 dinars (US$22-26) a month for access.

The ISPs offer “free” internet with the ISPs taking 60-70% of the retail bandwidth cost. Sudatel has launched DSL broadband but appears to have no intention of wholesaling to retail ISPs. It has rolled out the service mainly in the capital Khartoum but it has ambitious plans to roll it out to 60 towns and cities and a number of rural areas. The monthly charge for a 512k download service is 60,000 dinars (approx $260 a month).

However prices will come down by around 70% when Sudatel announces its new pricing structure shortly. And with this kind of price reduction, the number of subscribers should go up from the current figure of around 3,000. Dial-up subscriptions are therefore soon likely to become a thing of the past: As Mobitel’s Product Manager told us:”After DSL, most ISPs will vanish.”

Despite legalising a number of retail companies (buying from Sudatel) to offer VoIP (with a quality threshold), the grey market is apparently till a very large part of the international voice market. It is used both by individuals using things like Skype and through the country’s cyber-cafes and tele-kiosks. The latter advertise openly cheap calling prices to destinations like USA.

However, there is still plenty of room for those wanting to offer lower quality calling in the grey market. Sudatel’s current call cost to Washington DC is around 90 cents a minute. And as the regulator estimates that there are 60 million minutes coming into the country and probably as many going out, the grey market will remain profitable for some time to come.

Another interesting aspect of the international traffic market is that Monaco-based Midnet that supplies international connectivity to Areeba is owned by the same group of people that control Areeba’s owner Investcom. And packet-switched traffic is being sent for conversion and refiling to Areeba in Sudan.

Internet use is low because use of PCs is not widespread. The regulator NTC is looking at cutting import duties and has a scheme to offer Government employees 2 year loans to buy computers. Last year it sold 60,000 computers and has ambitious plans for that total to hot 2 million over 5 years. There are no computer labs in the smaller universities.

Nevertheless there are many cyber-cafes and access usually costs around 200 dinars  (US87 cents) an hour.

The regulator NTC also filters the internet for things like pornography and spam through a joint venture with an American company. As a result, internet access is much slower than might be expected from a country with international fibre connections.

Sudan is more “North African” in size and scale than typical Sub-Saharan African countries. Therefore you cannot fail to be impressed by the quality and extent of its backbone and the scale of its markets. But its vertically-defined, unified licence structure is an almost certain recipe for the triumph of the “big boys”: in effect, it pours all the potential of a large market into four buckets. It is noticeable that all four companies seem happy with this level of competition and that to us would seem to imply that the market could easily benefit from higher levels of competition.

Without regulatory intervention, there is an almost certain danger that most of the ISP sector will disappear unless Sudatel is forced to wholesale broadband capacity. Without others (like the power utility and oil companies) being allowed to sell fibre backbone capacity themselves, Sudatel has the opportunity to exercise dominant market power in the infrastructure layer. And these are not simply theoretical points as they are about whether local Sudanese will get the opportunity to set up small and medium-sized businesses in the sector as the market begins to double in size.

THE SECRET SAT3 AGREEMENT – WHAT IT REALLY SAYS

Following the South African Minister’s complaint that Telkom SA has not produced its copy of the SAT3 agreement, we have managed to talk to someone close to the Consortium who has read the agreement.

Apparently in legal terms the document is “very tightly worded” on the control the SAT3 operators have until the end of the national monopolies in April 2007. But after that date, it is not clear what the operators would like to see happen. Some are prepared and willing to take on the competition, whilst others would like to find ways of extending the existing monopoly privileges.

At the heart of the agreement is a statement that says each national Government grants the national operator landing rights for a defined period of time. After this period, it is unclear whether Government is bound into renewing the landing rights or could offer the rights to another party. Inevitably if the rights were passed to another party, there would almost certainly be legal action from individual holders.

NIGERIA’S UNIFIED LICENCING: THE T'S ARE GETTING CROSSED

The post - exclusivity period granted the four licenced GSM operators effectively ended last Tuesday, February 28, 2006 with the introduction of unified licences. Like the Chief Executive Officer of Mtel, one of the GSM operators said, at a stakeholders forum last Monday, the GSM revolution is over. According to him, while the privilege lasted, the members of the exclusive club made the best use of it.

Although the post-exclusivity is over, the unified licencing era has not really commenced. This now is the period or preparation and readiness. The Nigerian Communications Commission (NCC) was expected to publish the final copy of the framework on Wednesday last week.

But the gathering of Stakeholders on Monday, February 27 had one or two advice to offer the Commission. Whether the Commission would have enough time to consider such suggestions in detail before rolling out the final framework yesterday as promised is altogether another matter. But the Commission sure got some useful suggestions.

The CEO of Linkserve, Chief Chima Onyekwere told NCC that before the full take-off of the UL regime, the Commission should endeavour to set up an arbitration committee which should decide swiftly, disputes between feuding operators especially over interconnection. Ndukwe acknowledged the need for such a panel disclosing that NCC was indeed thinking in that direction.

"We are aiming at coming out with a stiff penalty so that a company that refuses to connect another operator would be forced to pay the operator he had refused to connect or disconnected all such revenues estimated to have been lost during the period in question.

This disclosure received a loud applause from the audience. It has a catch however. Those PTOs with the habit of owing would not go unpunished. In fact, as a first measure, companies with outstanding interconnect bills would not be allowed entry into unified licencing regime. This second disclosure did not receive as much applause as the first, probably because there were many debtor - PTOs in the house. But it was a position that was dear to MTN. According to that operator, just as there are penalties being prepared for operators who fail to connect others, there should also be penalities arranged for those who fail to meet up their obligations. What is good for the goose is also good for the gander. For MTN, anti-competitive behaviour included refusal to pay one's debts.

Other suggestions also came from the General Manager of VGC Communications, Gbenga Adebayo who presented the PTO's perspectives. His comments were targeted at fellow PTOs. Adebayo said co-location is one way out for operators. The look of the future is already taking shape. Little cash in possession of small operators would thin out as they try to compete on a national scale. So, it made sense for them to co-locate infrastructure. He also advised that operators should invest in the right equipment. They should also consider merger and acquisition, especially between small and medium scale operators as a way forward.

But the same old line of reasoning persisted, with the GSM operators on the one side and the PTOs on the other.For instance, the Managing Director/Chief Executive Officer of ReltelWireless,  Vinoo Goyal was of the opinion that the entry fee is still a barrier. He was referring to the N260 Million any fixed operator wishing to do national mobible should pay. None of the GSM operators who spoke with THISDAY shared that view. As far as they could see, there is a great difference between $285 million and a 'mere' N260 Million the PTOs who want national mobility are being asked to pay.

Still on the same entry requirements, those who paid $285 million five years ago and who now want to do national fixed, according to the guidelines, are required to pay N44.6 million. The concerned operators are still asking, why should we pay anything at all?

NCC would side with the GSM operators concerning the N260 million the PTOs are required to pay. Ndukwe told the stakeholders that it was a fair amount. He said, "The entry fee established a level-playing ground for everybody." The Commission would however also support the position of the PTOs on the other issue. No one is supposed to get the fixed telephony licence for free.

For those looking for some of the things that may take place between now and the time UL would take off fully, a directive on the mandatory use of the interconnect clearninghouses may be it. Ndukwe gave that hint when he told operators that. While responding to a stakeholder who urged the Commission to make it mandatory for operators to interconnect through interconnect clearinghouses, he said, "we are very serious with the use of interconnect clearinghouses which we have licenced." He said at this stage of Nigeria's telecom development, the clearinghouses are necessary. If this is done, it would be one down for the GSM operators who have continued to treat clearinghouses with disdain.

It wasn't a smooth affair last Monday. When the Reltewireless MD said the entry fee should be lowered, Ndukwe asked if Reltel made a recommendation to that effect. The Reltel official said no. Ndukwe said everybody had the option of making an input when operators were asked to read the draft and make suggestions. Reltel did not utilize that opportunity. But other stakeholders point out that 14 days were too short to actually read the document, digest it and come up with any serious suggestion. So then there was the issue of whether the consultation process was detailed enough. That remains outstanding.

Many other things has become clear in the meantime. The first is that the post exclusivity would not be extended although the pioneer status enjoyed by the GSM companies continues unabated.

Second thing is that the unified licencing regime has become a fait acompli.

Third, NCC and no other person should bother himself about frequency management and whether there would be distortion to it or not. The Commission has the competence to deal wityh that. Momife had said in his presentation that the era of GSM has gone. However, the Vmobile Head of Regulatory Affairs, Mr. Snidjers would comment that there is no more spectrum for another GSM regulator unless Mtel wanted to give out its own. That may not be exactly right since in Lot 2 in the 1800 MHz band, the Commission still has 15MHz unallocated.

(SOURCE: This Day)

KENYAN GOVERNMENT TO OFFER SNO LICENSE IN JULY ON BACK OF INDUSTRY RE-HAUL

The Kenyan government is seeking to auction a license for the country’s second national operator (SNO) in July 2006. The SNO would be awarded a unified license, allowing it to provide fixed line, mobile and international gateway services, as well as operating the wireless loop. This is the second attempt by the government to launch an SNO. In 2004, an auction was carried out, which saw three out of seven initial bidders submit technical documents for evaluation, however, the then minister of information and communication Raphael Tuju, halted the auction, stating that it was flawed.

Meanwhile, the government also announced that mobile operators, Celtel Kenya and Safaricom would be awarded international gateway licenses in the same month. This is expected to not only increase the quality of calls, but also reduce the cost of calls, thereby encouraging further adoption of mobile use, through attractive packages. Moreover, it will also mean that international calls will not have to be re-directed over state-owned telecoms operator Telkom’s network, thereby reducing interconnection charges for both operators.

However, the country’s internet service providers (ISP) came under fire from the Communications Ministry, for failing to take advantage of its offer to equip ISPs with enough bandwidth to provide broadband services, stating that no representatives had come forward over issues related to the sector. The Ministry is keen to see the cost of broadband pricing reduced, alongside the introduction of additional services. These announcements are part of the Kenyan government’s drive to carry out a major re-haul of its telecoms industry, in an attempt to create greater competition in the market.

(SOURCE: Business Monitor)

TANZANIA TO CHAIR NEWLY RENAMED COMMUNICATIONS REGULATORS ASSOCIATION OF SOUTHERN AFRICA

  The Communications Regulators Association of Southern Africa (CRASA) has unanimously elected Tanzania as its chairman. CRASA is the renamed TRASA, a regional association of SADC member states was formed in Dar es Salaam in 1997, but like ARICEA, it has now decided to admit broadcasting regulatory authorities.

Tanzania was voted to co-ordinate regulatory matters, exchange of new ideas and promotion of telecommunications skills in Southern Africa regions during the Telecommunications Regulators Association of Southern Africa (TRASA) 9th Annual General Meeting (AGM), which ended in Dar es Salaam at the weekend, according to a statement issued last week by the Tanzania Communications Regulatory Authority (TCRA).

Delegates also collectively agreed to change TRASA to CRASA so as to embrace the convergence of technologies in the sector, mostly communications, broadcasting and postal services.

The statement says CRASA officials elected Tanzania Communications Regulatory Authority (TCRA) Director General Prof John Nkoma Chairman of the regional association. Prof Nkoma took over the chairmanship from Trilock Dwarka of Mauritius who has just completed his term of office. Mauritius was elected first vice chairperson of the executive committee, Angola was voted second vice chairperson while Botswana attained the treasurer post.

CRASA delegates also resolved and approved the constitution of a committee, to prepare the association’s new strategic business plan, comprising representatives from Botswana-Convenor, Tanzania Co-convenor and four members namely Angola, Mozambque, South Africa and Zambia. Following its election, Tanzania pledged to play a key role in initiating special programmes aimed at bridging the gap of digital divide, which poses threat to the development of third world countries .

It will also be responsible for various administrative issues and collaborate with CRASA member states in decision making, says the statement.  During his vote of thanks, CRASA Chairman designate Prof Nkoma said Tanzania would strive to fulfil objectives of the association, which include maximising the utilisation of scarce resources in the special areas of communications.

(SOURCE: Guardian)

‘FLASHING' REPORT IDENTIFIES FOUR MILLION FLASH CALLS ON MOBILE NETWORK

The appetite to own a mobile phone is still very high in every part of Kenya, hence this is one of the fastest growing markets for the facility in the world.

But it is also a region with a very high 'flashing' rate as well. According to the Informa Telecoms & Media's World Cellular Information Service, in August 2005 a Kenyan GSM network estimated four million flash calls were initiated daily from its network.

This indicates that despite the high subscription rates, tariffs affordability remained a big problem. Mobile phone users in Tanzania have resulted to a 'flash language'; where for instance flashing once may mean "I am on the way"; flash twice "I am waiting downstairs"; flash thrice "I am at home" etc.

Flashing, said to be a widespread in Africa, led to flashback services being implemented in several countries such as Nigeria and Cameroon.

But the problem of the consumers is not only high tariffs but also quality of the service as well. Traditionally, consumer protection has been addressed through licensing alone- where unique provisions are embedded in an operating license or regulations, intended to generically protect consumers and new competitors alike.

The purpose of liberalising state-run monopolies to private, competitive service providers is to increase the number of providers, and thereby increase quality, quantity, types of service, and decrease costs to the consumer.

Rather than expect consumers to read dense regulatory and licensing language, by distilling the information into a Consumers' Code, regulators can empower consumers to protect their own rights.

According to a USAid publication, consumer empowerment entails creation of a body of consumer protection policies that assume direct involvement of the consumer.

The underlying assumption is that consumers are best protected if they are empowered to defend their own rights, which is also the European Union policy.

The failures of consumer protection have a direct negative impact on the cost and trustworthiness of a country's telecommunications infrastructure.

As a start-up ISPs practise honesty in trading, high standards of service, fair competition, legal and responsible trading, acceptable use policy, respect of confidentiality, unrestricted and open interconnection, dispute resolution, and prohibit illegal and harmful content.

International bandwidth cost reduction benefits, such as that expected this month, and license fees reductions should be passed on to the consumers.

Genuine self-regulation must be distinguished from "corporate social responsibility".

Currently, GSM companies need only notify CCK and apply new tariffs. With a GSM duopoly, the vulnerable consumer is left with a very limited choice of providers.

While fixed telephony is subject to a price cap formula it is unclear under what terms mobile prepaid subscribers get services from the companies. Many ISPs are known to decline, delay, or only issue service level agreements to "troublesome" clients.

Internet services are negotiated; but the question whether the consumer makes informed consent remains. As the Minister for Information, Mutahi Kagwe stated recently, the preferred regulatory recipe is one flavouring a blend of industry self-regulation and official legal enforcement.

(SOURCE: The Nation)

IN BRIEF:

-   The Rwandan regulator is preparing the tender documents for an SNO. Most likely contender? MTN that is already a mobile operator in the country.

-   The Zimbabwe power utility’s fibre division Powertel has had a disappointing performance that has largely been put down to the wider troubles of the country’s economy.

-   The Malawian regulator MACRA is still without a Board after ten month, the Government having removed the previous Board. MACRA’s management is now directly answerable to Government. Perhaps Government is getting used to having this kind of control?

- The Egyptian regulator NTRA affirmed that there will be no extension for receiving Egypt’s third mobile license’s bids unless it was requested by half of the interested investors. It was also added that priority is given to consortiums.

TELECOMS, RATES, OFFERS AND COVERAGE

- Old telephone lines in Keren province of Eritrea have been replaced with new ones that stretch underground. The head of Eri-Tel branch office in Anseba region, Aineta Girmai, pointed out that more than 2,000 permanent telephone lines have so far been made available to the residents of the town and that efforts are being made to meet public demand.  Reports indicated that around 2,470 customers in Anseba region got access to mobile telephone lines since the introduction of mobile phones in the region. The necessary infrastructure facility is already set in place for the distribution of additional mobile phone service.

- Vodacom, South Africa's will  add an additional number range to the current number ranges, including 082, 072 and 076 . As from 1 March 2006, Vodacom will officially add the 079 number range to its network, making sure there is sufficient capacity for future growth.

- Millicom International Cellular (MIC) has changed the brand names of its Ghanaian subsidiary Millicom Ghana to Tigo, in line with its strategy of having a single brand name for all its global operations. Previously the GSM operator offered its services as Mobitel/Buzz GSM. The evolution is being billed as more than a simple name change. MIC plans to offer a much improved service offering MMS, GPRS, international calls at local rates and other value added services. Ghana is the third MIC operation in Africa after Senegal and Chad to launch Tigo.

- Nigeria’s second national operator (SNO) Globacom has connected an additional 35 towns and cities to its mobile network Glo Mobile since January according to a report in local broadsheet Vanguard. The telco added five towns – Oju, Anywuogbu, Ochimodi, Ega and Ogengen - to the network last week alone and this week connected one of the county’s largest tourist resorts Obudu and its surrounding communities. Meanwhile MTSFirst, a mobile phone operator, has launched its service in Ibadan.  Subscribers will also enjoy SMS, Internet and other value added services available on the MTSFirst CDMA2000 1x wireless telephony network.  In a move further  MTSFirst also announced a massive cut in some of its international call rates to as low as N15 ($0.12) per minute for calls to the USA and Canada. Finally, Mtel, the mobile subsidiary of state-owned fixed line telco NITEL, has revealed plans to increase the capacity of its network by 2.5 million lines in the next six months, up from 1.2 million at present. The cellco said it would build 800 new base stations as part of the project, up from its current 500.

- Celtel Sierra Leone has expanded its GSM network to Pujehun Township and the surrounding towns and villages. The cellco currently provides coverage to around 75% of Sierra Leone’s territory, and said it wants to increase this figure to 100% over the next few years. Earlier this month it announced plans to invest USD20 million in network expansion. Meanwhile rival Comuim cellular announced that the  company its subscriber base has reached over 105,000 compared to only 35,000 in May last year.

- ZAMTEL launched its mobile service Cell Z in Mwembeshi. The launch of the mobile service would enable Mwembeshi residents and Nampundwe mines to enjoy the Cell Z network and ease their communication hurdles. Mwembeshi Earth Station capacity was still large despite the facility being established many years ago.

- Some 69 localities in the Somali State have become beneficiaries of wireless telephone services, the Jijjiga High Area Office with the Ethiopian Telecommunications Corporation (ETC) said. Meanwhile, 17 localities in Pawe Special Woreda of the Benshangul-Gumuz State have also got access to wireless telephone services, Information and Public Organization Representative with the Special Woreda said.

NCC CEO SEES UNIFIED LICENSING DRIVING INDEPENDENT ISPS OUT OF BUSINESS

Speaking at a recent stakeholder meeting on the new unified licensing regime, NCC’s CEO Ernest Ndukwe said that the new regime is unlikely to prove conducive to independent ISPs: "My advice to ISPs is to merge with existing operators. Or they could obtain the UL and concentrate in that sector where they have a niche market." In the reshaping of the market, it will be the small and medium-sized ISPs that will suffer as they do not possess the capital resources of the larger players.

EX- WORLD BANK OFFICIAL LAUNCHES ONLINE LOANS SERVICE

Dennis Whittle saw an opportunity to tap into what he calls the "secondary market" for donations. He quit the World Bank, and six years ago, he and a colleague started a private, web-based microfinance program called Global Giving.

"Global Giving just enables small-scale grassroots projects to match up with relatively small donors all around the world, who want to help them make a difference," said Mr Whittle.

"The website is kind of like a combination of eBay and Amazon. And the idea is that qualified grassroots projects from around the world can be listed, as long as they meet certain qualifications.

"If you're a donor, and you're interested in HIV/Aids, you can find projects to fund. If you're interested in projects in Kenya, you can find those. It's a clearing house."

A potential donor searches through a list of small-scale projects on the Global Giving website. You can even e-mail project leaders for more information.

Then, the donor can choose to give as little as $10 to a project. Some, though, have given as much as $150,000. Global Giving has raised millions of dollars in donations for smallprojects in the developing world.

(SOURCE: BBC)

UN TO ESTABLISH INTERNATIONAL FORUM ON INTERNET GOVERNANCE

Following up on an agreement reached on the contentious topic of internet governance at the November World Summit on the Information Society (WSIS) in Tunis, United Nations Secretary-General Kofi Annan has decided to start creating a forum for a more inclusive dialogue on internet policy. According to his spokesman,  Annan will establish a small Secretariat in Geneva to assist in the convening of an Internet Governance Forum, following consultations held in February by Nitin Desai, the Secretary-General’s Special Adviser for the WSIS that produced a consensus on the need for a strong development orientation.

“It was also felt that the Forum should be open and inclusive, and allow for the participation of all interested stakeholders with proven expertise and experience in Internet-related matters,” said spokesman Stephane Dujarric told reporters in New York.

The Secretariat will be headed by Markus Kummer, who has been the Executive Coordinator of the Secretariat of the Working Group on Internet Governance, which was established by the Secretary-General at the request of the first phase of the Summit, held in Geneva in 2003.

In November, amid rumours that the UN was trying to take over the Internet, WSIS decided that a non-profit United States-based body, the Internet Corporation for Assigned Names and Numbers (ICANN), will remain in charge of technical management of the Internet, though individual countries will manage their own country-code domains.

In addition, it asked Annan to convene the governance forum, which would have no oversight function and would not replace existing arrangements, but would allow for dialogue among stakeholders.

The purpose of this exchange, according to the WSIS outcome document, would include making the Internet more multilingual, supporting local content development and addressing "many cross-cutting international public policy issues that require attention and are not adequately addressed by the current mechanisms.” The first meeting of the Forum is expected to take place later this year in Athens.

(SOURCE: CI WebWorld)

5G WIRELESS COMMUNICATIONS AND POLESTAR NIGERIA BRING HIGH-SPEED WIRELESS INTERNET ACCESS TO LARGEST CITY IN NIGERIA

5G Wireless Communications Inc last week announced wireless high speed Internet access for offices and homes across the city of Lagos, Nigeria, and neighbouring communities following the deployment of its Citywide Base Station technology.

The arrangement and deployment of service in Lagos was made possible by Polestar, one of 5G Wireless' channel marketing partners based in Port Harcourt, Nigeria. With this development, offices, homes, churches, estates, supermarkets, and other corporate and individual concerns in Lagos and surrounding neighborhoods can now enjoy broadband speeds and uninterrupted Internet access 24/7, all year round.

5G Wireless uses its new cellular-style Wi-Fi base stations to create a broad service area with non-line-of-sight (NLOS) capabilities. These enhancements are compatible with standard IEEE 802.11b/g Wi-Fi equipment. The 5G Wi-Fi Hotzones function through macro-cell base stations deployed from tall towers and the tops of tall buildings, while dead spots are filled in with smaller micro cells following the proven deployment strategy used today by the cellular carriers. This type of structural design allows for a combination of cells resulting in a claimed ability to add higher capacity where and when needed.

"The deployment of Wi-Fi Internet access was part of the phased massive infrastructural outlay that comes with the Citywide Base Station (802.11b series) which was introduced to the Nigerian market a few months ago," says Obasi Uba Obasi Jr., CEO of Polestar. "The Internet access being offered by Polestar and powered by 5G Wireless is unrivaled in terms of speed, download capacity, and virtual connections within the city of Lagos. This is just the first step in setting off other deployments across other key cities in Nigeria."

Recently, 5G Wireless Communications and Polestar concluded the deployment of facilities in four key locations across Lagos.