The new scramble for Africa – acquisitions reshaping the communications landscape

A new scramble for Africa is under way as multinationals from all over the world take a new interest in acquiring communications companies on the continent. The temperature for fresh deals has also been raised by a number of companies on the continent itself seeking to shape a regional or indeed international strategy for themselves. A dizzying succession of deals and announcements of acquisition strategies means that even if only half of what is announced happens, the landscape of the communications sector may look very different over the next three years. Russell Southwood identifies the players and looks at which strategies might succeed.

The largest of the international players with an interest in the continent is Vodafone. Because of a past agreement, it has until recently only operated as Vodafone above the Sub-Sahara leaving its minority partner Vodacom a free hand across the territory in the south. In late 2005, it upped its stake in Vodacom from 35% to 50% in deal worth US$2.4 billion. However, getting complete control will not be easy as Telkom South Africa has the remaining half of the shares.

Vodacom’s existing relationship with Telkom South Africa has not been all plain sailing. Originally the two bid for the Nigerian incumbent Nitel but Vodacom dropped out of the deal.

Vodafone has also tried to buy control of the largest of Kenya’s two mobile operators Safaricom, again without success as it was unable to agree a price with the Kenyan Government for the shares. The latter needs the money to fund a redundancy package at the incumbent Telkom Kenya. However the interest is there and the opportunity may arise again in more favourable circumstances.

The other large multinational with an interest in the continent is France Telecom and its mobile subsidiary Orange. France Telecom has always seemed to be the preferred buyer for incumbent telcos in francophone Africa, acquiring majority or controlling interests in Senegal (Sonatal), Mali (the SNO Ikatel), Cote d’Ivoire (Cote d’Ivoire Telecom) and Mauritius (Mauritius Telecom). However it lost out in Niger to a consortium that combined Libyan money with state-owned Chinese equipment manufacturer ZTE, more of which later.

Through its Orange subsidiary, it has operations in Botswana, Ivory Coast, Cameroon and Madagascar. It wanted Sonatel’s mobile operation (currently branded Alize) to take on the Orange brand (and pay for the privilege) but this was fiercely resisted by Sonatel’s own workforce and the idea has been dropped for now. But France Telecom’s continuing interest in the sale of francophone incumbents means that more mobile operations may fall into Orange’s lap.

However its Internet expansion strategy through its subsidiary Wanadoo appears to have had something of a less firm touch. Originally Wanadoo had minority partnerships in both Algeria and Morocco but of these two, only the 25% shareholding in the Algerian company EEPAD survives.

One of the big issues for France Telecom is language. It has only really managed to venture out of the francophone area in one country (Botswana) and in two other countries where it has a presence, French is at least as well used as English. It is unfortunate for French businesses like France Telecom that the current President of France takes such a dim view of them speaking English. They may need it if companies like France Telecom are to become truly global businesses outside of former colonial possessions.

The other French company that is a “would-be” player is Vivendi, one of those dot-com created conglomerates that describes itself as a leader in media and telecommunications with activities in music, interactive games, television and film and fixed and mobile telecommunications. It claims to be “a major player in each of its activities” but has only two operations: a 56% interest in France’s number two mobile operator SFR and a 51% stake in Maroc Telecom, Morocco’s former incumbent.

It recently told French business newspaper Echos that it would be interested in buying a stake in Gabon Telecom (with its Libertis mobile subsidiary) and the incumbent in Cameroon, Camtel. It is also believed to be interested in bidding for the Senegalese SNO when it is finally tendered. It bid for Tunisie Telecom but lost out to the eventual winner Tecom. It looks set to become the alternative bidding favourite for francophone incumbents being privatised.

But the most substantial recent deal-makers have been the Gulf-based, Arab telcos. MTC Kuwait bought Celtel for US$3.4 billion and has announced its intention to spend a further US$1 billion plus to gain control of the contested V-Mobile in Nigeria. Last December it added to its 13 existing country operations by buying a controlling share in Madagascar’s Madacom from the Distacom Group. On a buying roll, it has also set its hat on acquiring the new third mobile operator’s licence in Egypt.

The other Arab company that has entered the ring is UAE incumbent Etisalat. In April 2005 it bought Atlantique Telecom and as part of its assets got mobile operations in six countries: Benin, Burkina Faso, Cote d’Ivoire, Gabon, Niger and Togo. However the local owner of the Ivorian operation has pre-emption rights. It is also behind the new Sudanese SNO Canartel in which it has taken a 40% stake. Finally the Dubai-based SNO Tecom recently won the bidding for a 35% stake in Tunisie Telecom in a US$2.27 billion deal. It was only to be expected that Arab companies would seek to expand their markets to North Africa but the wide range of purchases made show they are seriously interested in making money on the continent.

The interesting outsiders are the Chinese. As noted earlier, state-owned ZTE won the tender for Sonitel in Niger and has also appeared on tender lists for other privatising incumbents. It was also in serious discussions with Zambia’s Zamtel at one point about buying a stake. So what is a Chinese equipment manufacturer doing bidding for telecoms operations? It seems that as it has not been able to break into developed world markets and has not gained (along with privately-owned Huawei) a significant market share in Africa despite considerable effort. So maybe it’s a case of if you can’t win the bid, why not buy the company?

Almost as interestingly, state-owned China Mobile is one of the bidders for Nasdaq-listed Millicom International, which is a global mobile operator with African subsidiaries in Chad, DRC, Ghana, Mauritius, Senegal, Sierra Leone and Tanzania. According to the Financial Times, its bid is over $4 billion and forms part of the Chinese Government’s “Go Global” policy which has been encouraging overseas expansion by state companies to ensure they will be able to compete with US, European and Japanese multinationals in the long-term. However it faces stiff competition from a number of players including Egypt’s Orascom and Kuwait’s MTC. There have also been rumours in the market that Lebanese-owned Investcom will be sold if the price is right.

An interesting independent player is Gateway Communications which has steadily been building up its portfolio of companies. In April 2005 it bought for Celtel’s international wholesale carrier Link Africa for US$50 million and is steadily building its business and making acquisitions when attractive.

A wild card is India’s Tata Group. It has invested in the South African SNO and although it will take time to create a business in an increasingly competitive market, it cannot surely rest content with only operating in one market.

There are also a number of what can only really be described as “international oddities”. South Africa’s third mobile operator Cell-C is 60% owned by Oger Telecom South Africa, a subsidiary of the Saudi incumbent Oger. However it is the only operation Oger has on the continent, although it was recently one of the losing bidders for Tunisie Telecom with Italian incumbent Telecom Italia.

Hong Kong’s Hutchinson Telecom has one mobile operation called Kasapa in Ghana. Logic dictates that if it is successful in its current phase then Hutchinson will be faced with the possibility of looking for other opportunities. Rwanda Telecom was purchased by US-owned Terracom and although it is developing ambitious plans within that country, does not appear to have wider expansion plans.

If all those looking to invest in the continent were walking the same street, they’d meet a couple of operators going the other way, looking to leverage their regional position into something more like a global foothold. Egypt-based Orascom Telecom has dumped most of sub-Saharan mobile operations (with the exception of the troublesome Zimbabwe and Algeria in North Africa) and is increasing its stake in Hutchinson Telecom to 23%. Its acquisition strategy is Europe-facing: it currently owns Italy’s Wind and is looking for other European opportunities. As it Chairman Naguib Sawaris says:”It’s very clear that size matters.”

South Africa’s MTN is another company looking to break out of the region. It is one of the region’s most successful mobile operators and is cash-rich but somehow has not managed to parlay this into growth through acquisition. Recently, it has been “always the bridesmaid and never the blushing bride” in bidding for regional tenders, most notably losing out in Kenya to Celtel. To be fair, it did acquire shares in Botswana’s Mascom from Econet and an operation in Congo-Brazaville at the end of 2005 but otherwise there have been slim pickings.

By a stroke of luck, it inherited an Iranian licence when the winning bidder dropped out and is working hard to get it up-and-running to tight deadlines. The sceptics are saying that it has neither the management, nor the capital resources to play on a global stage and as a result is a prime target for acquisition. Although it is a quoted company, the MTN Group owns 72% of its own shares and staff and management the balance so any acquisition would not come cheaply.

The wild card of those looking externally is the Nigerian SNO Globacom. According to its COO Mohammed Jameel “We are a cash-rich company keen on foraying into India, as the telecom market here is booming. We are not averse to investing in call centres, banking and petroleum sectors in India. We have decided to make India the Asian hub for our manpower needs for telecom,” he says adding that, “we are looking at a strategic partnership with one of the existing telecom operators. Globacom is going to invest $500-700m in India.” Globacom is owned by Nigerian Mike Adenuga’s MA Group that it has been claimed is worth US$5 billion.

Beyond those coming in and those going out, there are deals that flow from the fall-out of international acquisitions and mergers and from struggling international companies concentrating on their “core business”. Verizon has recently sold its Latin American assets and when the dust settles on its purchase of MCI, it might well look at whether it wishes to retain UUNet. Cable and Wireless’s new CEO is trying to concentrate on high-value corporate business and may well decide that its international wholesale business could be a disposal.

Various European telcos have been bid targets but this deal traffic is largely irrelevant to Africa. However when recently there was talk of a bid for Portugal Telecom, speculation was rife that any buyer would dispose of its African assets and indeed Telkom South Africa seemed to be encouraging this kind of talk. Portugal Telecom’s assets in Africa are a mixed bag. With the exception of Angola (Unitel), Morocco (Meditel minority share) and Cap Verde, its other interests in Mozambique, Sao Tome and Guinea Bissau are largely stagnant.

Undaunted, Executive Chairman of PT Investimentos Internacionais (PTII) said in July 2005 "This is the moment” to invest in Africa. Also he believes that there are great business opportunities in Brazil. He is probably right but for Portugal Telecom any sustained international strategy based on its current assets is a fantasy that it does not seem to be acting on. Like France Telecom, language is a factor that restricts its ability to grow into a truly global company. Therefore, whether or not Portugal Telecom is sold, it may not be long before the sale signs go up over PTII.

At a more modest level, there are a number of regional players with continental aspirations. The prize for the most confused must go to Telkom South Africa. At various points over the last two years it announced its intention to purchase national incumbents that were being privatised or could be bought, including Nitel, Telkom Kenya, Zantel and DRC’s OPCT. In every case, these bold intentions have come to nothing. Perhaps the idea of being a regional telco was tied up with its idea for how the EASSy fibre project might be run as a consortium and whatever happens, that moment will not return.

More recently it bid R2.4bn for Business Connexion which seems to presage an attempt to find companies that “add-value” to its underlying voice and data assets. But although Business Connexion is energetic in pursuing continental business, only 14% of its revenues come from outside South Africa. Nevertheless it has put aside R30bn for growth and acquisitions over 5 years. The key question is how will it keep its eye on South Africa as competition challenges all of its markets if it is seeking to have a coherent regional growth strategy?

Others in the same hunt for “value-added” acquisitions include Didata and its subsidiary Internet Solutions. The latter announced publicly last year that it wanted to take a significant position in the East African market.

Nigeria’s SNO Globacom has announced that it hopes to explore new markets in Morocco, Ivory Coast, Cameroon, Ghana and Benin Republic and has also announced it will build a fibre between London and Lagos that may connect most of these countries if it bought interests in them.

Another potential purchaser is South Africa’s Altech which is currently sitting on a cash pile of R1.5 billion. Altech CEO Craig Venter recently said: "We are keeping everything and will complement with some large acquisitive growth."

A regional wild card is Namibia Telecom. It took a minority position in the South African SNO and it bought into Mondu Startel of Angola.

The really sad case is Econet Wireless. It has not really been able to leverage itself into the international arena (a small franchise in New Zealand doesn’t really count) and its expansion plans on the continent seem to have been stalled by the loss of its income flow from its Zimbabwean licence. Although it has an option to buy V-Mobile in Nigeria it is highly unlikely that it will be able to find the US$3.4 billion being offered by MTC. Its third licence in Kenya is still in the courts.

It has an option to buy Telecom Lesotho but that’s not exactly a major league deal. And although it was to have partnered with Altech (see above) the two companies had a very public falling-out. Its “share-option” approach was always perhaps a creative way round not having enough of its own cash but it seems to have reached the end of road. Although it has announced that it is preparing an IPO, this is actually the second time the bride has gone to that particular altar and the previous nuptials were cancelled. It would a “buy” opportunity but potential investors might well be cautious based on its public falling-out with Altech.

However what it does focus on is the limitation on raising capital within the continent itself that would allow any regional player to do deals at a large scale. Those with longer memories will remember MTN had to clear the scale of its bid for its Nigerian licence with the Government because of South African currency restrictions. Kenya mobile operator Safaricom last raised significant capital through a loan facility. The sum raised – US$166.6 million – looks like “lunch money” alongside the larger deals being made on the continent. However it was announced as the largest loan deal of its kind in Kenya and again had to be approved by both the Ministry of Finance and the Ministry of Information and Communications. Not exactly the Chinese approach to encouraging companies to get ready for global growth….

So what can be said about possible, successful acquisition strategies? Acquisitions of things like mobile licences are relatively straightforward: the “metrics” of the market are known to the key players and they broadly function in similar ways. Local “cultures” may be different but the business fundamentals are not. Outright purchases of larger assets often prove harder to digest. Whilst acquisitions is an accepted route to growth and positively encouraged, too little attention is paid to the number of unsuccessful large acquisitions.

Most buyers agree that the mantra to keep repeating is “buy customers, not assets”. There are lots of African companies (particularly incumbent telcos) with infrastructure assets. However once competition is introduced, there is no guarantee that these customers will want to stay with you. It may be that a buyer of an incumbent can turn previously legal monopolies into de-facto monopolies by defending past privileges successfully.

But there will come a point where it is necessary to run a successful business on its own merits and this requires a very different mentality. Telkom South Africa is the company most publicly going through this change but it’s worth noting how many of the large mobile operators are acquiring incumbent behaviour just as the incumbents themselves are beginning to shed some of these vestiges of the past.

The incumbent mindset is to look for “franchises” that can be bought and defended to the last ditch. Mobile franchises are seen as the most valuable of these long-term money-making franchises. They are viewed by those punting on large deals as “cash-cows” that once established will turn out a predictable income over ten years at least. The cash piles generated by MTN and Vodacom are a tantalisingly attractive indication that this proposition has at least been true historically.

However, disruptive technologies are about to do to the mobile companies what they in their turn have done to the national incumbents. If Nokia and Motorala are producing IP-phones, then the direction things are going in is clear, even if the timetable is not. Therefore what is needed (and currently largely appears to be lacking) is an attitude of looking at emerging business opportunities that can take market share at lower prices and work from an even lower cost base.

Inevitably the next generation of market opportunities will challenge established players and particularly those that have significant market share or are monopolies. The new generation of players might be any of the following:

- Wireless broadband operators with the capacity to do mobile IP voice when the moment arrives as it will do before too long.

- Incumbents capable of transforming themselves into “triple-play” operators and making a swift transition to IP networks.

- Incumbents capable of becoming “carriers’ carriers” and drawing back from defending every last vertical business they hold.

- Value-added operators servicing multinationals and the financial sector. These will not be people who just sell bandwidth but staff that can understand client businesses and make them work better.

- Mobile operators capable of preparing for the moment when the “high-price voice franchise” runs out and will genuinely innovate. These will not be companies that produce interesting tactical marketing ideas but those who start to operate new services like data and e-cash.

- Convergent operators capable of challenging DSTV’s content monopoly across large parts of the continent.

So what’s up for grabs? There are a number of incumbents that are making stately progress towards being privatised. The difficulty for all purchases of incumbents is that the Government as seller generally has an exaggerated view of their value and not much information to support its view. Malawi is a recent example of the expectations gap.

Incumbents up for sale with mobile operations include: Camtel (Cameroon); Gabon Telecom (with Libertis); Gamtel (Gambia); Ghana Telecom (One Touch); Nitel (Nigeria); and Sotelma (Mali). TDM (Mozambique) and Zamtel (Zambia) are both at the stage in the political cycle where privatisation is off the agenda but it may yet come round again.

Incumbents for sale without mobile operation include: OPCT (DRC); Telkom Kenya; and Westel (Ghana). These are all operations for buyers with strong nerves and probably long pockets.

And of course, there are always smaller scale companies for sale but no-one likes to be flattered by seeing their name in print as a potential acquisition target. However, they are out there and the better buyers know who they are….

NIGERIA’S NCC IS LOOKING FOR A QUICK 3G IMPLEMENTATION

Nigeria’s regulator went out to consultation last week on the forthcoming implementation of 3G. It wants it to happen as quickly as possible and bidding for licences will be very competitive because of spectrum shortages.

Executive Vice Chairman of the NCC, Engr Ernest Ndukwe speaking at the consultation event said: "As a regulator NCC has adopted a technology neutral approach. We don't license it. What we license is spectrum."

Engr S.A. Bello, an executive commissioner stated that the Nigerian Communications Commission wants to implement 3G licensing in Nigeria as soon as practicable for the following commercial and regulatory reasons: demand from operators, interest of Nigerian consumers, development of downward linkage industries, and development of content.

On the price of licences, this is how Bello evaluated the Nigerian situation. "Based on recommendations of the UMTS Forum and experience from U.K. and European auctions about five years ago, an operator required a minimum of 15 MHz FDD and 5 MHz TDD spectrum to provide a viable 3G network. Based on this historical data we can only have maximum of three 3G operators with national coverage in Nigeria. However technical developments and regulatory intervention can increase the number beyond three.

"The fact there is not enough spectrums to go round all the 20 major and medium-size operators automatically means that a form of competitive licensing is inevitable," he said. Bello was however optimistic that the situation could change for the following reasons: development in technology can lessen spectrum requirement, regional licensing can accommodate more operators through frequency re-use, ITU may in WRC-2007 agree on more spectrums for 3G, and the TDD portion of the 3G spectrum allocation can be packaged separately for operators that can deploy TDD technology as platform for providing 3G services.

(SOURCE: Vanguard)

MILLICOM TO DEPLOY GSM NETWORK IN CONGO DRC

Oasis, the Congolese operation of Millicom International, has awarded Huawei a turnkey contract to provide a brand new GSM network. Under the first phase of the contract, Huawei will supply and install its Huawei EnerG GSM technical platform and deploy more than 500 base stations across the country. Millicom DRC will be launching the network with a capacity of over 1 million subscribers with a new brand name in Q3 2006. The initial phase of the network will cover 85% the population in the largest 182 cities of the Congo.

The Mobile World reports that the Democratic Republic of Congo (DRC) ended last year with just under 2.8 million customers - which represents a 4.5% market penetration.

(SOURCE: Cellular News)

KENYA TO CUT MOBILE CALL RATES BY 90 PERCENT?

Loose talk by a Ministry of Information and Communications official gives some indication of the hopes being placed in the recent interconnection study commissioned by the regulator CCK. And the conduit for this loose talk? The unlikely figure of Canadian inventor Kuba Farbiarz who passed it on to a seminar held last week in Nairobi. Farbiarz who had earlier met ministry officials on April 19, said the planned move could reduce the cost of cross-network calls to as little as Ksh.3 (about US$ 4 cents) per minute.

There was no comment from ministry of information officials, but an official from the regulator Communication Commission of Kenya (CCK) who asked for anonymity, told Business Week on phone that such plans were indeed in the pipeline.

"The take is that we wish to see communication become affordable to an average Kenyan (mobile) phone user and yes, we are looking at those figures (Ksh.3) but it is premature to state definite plans at the moment," said the official.

The time frame for the implementation of the plans however is not known. But the CCK official said government wanted to "see the move effected as soon as possible."

Currently the lowest cross-network rate is Ksh.24 ($0.31) per minute charged by the Celtel network.

(SOURCE: East African Business Week)

SOUTH AFRICA’S DISPUTED ICASA BILL TO BE REWORKED

The Freedom of Expression Institute has welcomed President Thabo Mbeki's decision not to sign the controversial Independent Communications Authority of SA (Icasa) Amendment Bill into law on the grounds that it may be unconstitutional.

Mbeki, who received representations from different organisations urging him not to sign the "unconstitutional" bill into law, has referred it back to Parliament for reworking.

The bill changed the appointment and dismissal procedures for members of the council of Icasa, making Communications Minister Ivy Matsepe Casaburri responsible for these procedures rather than Parliament.

The bill would also have ensured the Icasa chairman was accountable to the minister rather than Parliament for his performance.

"These changes would have destroyed the constitutionally guaranteed independence that Icasa enjoys from the ministry," Freedom of Expression Institute executive director Jane Duncan said.

"Had the bill been signed into law, the institute believes it would have been subject to constitutional challenge for violating the independence of Icasa."

Duncan expressed concern, however, about what she termed the "persistent tendency" of the communications department to draft constitutionally dubious legislation.

Democratic Alliance communications spokeswoman Dene Smuts said she was "delighted" by the president's decision.

(SOURCE: Business Day)

ZIMBABWE’S NETONE TO IMPORT GENERATORS TO BEAT POWER CUTS

Mobile phone network operator NetOne says it will import diesel generators to alleviate network failure spawned by incessant electricity power cuts.

The country has over the past year been facing power shortages due to lack of foreign currency to import power and expand local generating capacity.

Ellen Muchemwa, NetOne marketing and communications manager, confirmed the development and said the foreign currency shortage was an impediment to the growth of the company.

"The main challenge we have is shortage of foreign currency to upgrade the capacity and to purchase new base station equipment for roll out and alleviation of congestion," Muchemwa said.

She said despite the foreign currency challenges, the mobile operator had managed to install GSM 1800 base stations in addition to its current GSM 900 in Harare and Bulawayo to increase capacity and alleviate congestion.

Muchemwa said with a subscriber base of over 210 000, NetOne is looking at expanding the subscriber base but this was subject to foreign currency availability. A product of the unbundling of the then Post and Telecommunication Corporation, NetOne is wholly owned by government.

(SOURCE: Zimbabwe Standard)

GATEWAY COMMUNICATIONS EXPANDS LONG DISTANCE NETWORK ACROSS 30 AFRICAN COUNTRIES

Gateway Communications has completed its $1.4m upgrade and expansion of its international long distance network. This enables Gateway to link mobile networks effectively across over 30 African countries and to connect with its European gateway network. Having completed the roll-out across its network, Gateway now has the largest and most advanced network in Africa.

Much of the packet switched solution has been provided by Veraz Networks. The technology enables Gateway to route calls with just one satellite “hop” and therefore save 50 per cent on each call. This cost saving can be passed on to African mobile network carriers, helping Gateway to keep African dollars within Africa. Quality of calls is also greatly improved as degradation arising from distance travel is halved.

Gateway Communications can now efficiently expand its global VoIP footprint in new markets by carrying traffic from any mobile networks, converting it locally to VoIP, transmitting it over satellite between mobile networks and all this being remotely managed by its Belgium and South African network management centre for global connectivity. With a next generation network in place, Gateway is able to use Next Generation Networking (NGN) architecture to deliver new services over a converged IP network.

Peter Gbedemah, CEO of Gateway Communications, commented on the network expansion “Gateway is now the largest and most advanced network in Africa, able to deliver significant cost savings to our customers through effective intelligent switching and compression technology. Gateway is the only provider to take full advantage of this powerful technology in Africa switching minutes in the sky, without backhauling calls through Europe, and better leveraging Africa’s legacy networks. This has been critical in facilitating rapid growth in mobile traffic across Africa. The savings on every call, allied to the vast increase in quality, make this technology indispensable to Gateway.”

MTN AND TERRACOM TO AGREE ON INTERCONNECTION PRICES

Rwanda's two major telecom providers, MTN Rwanda and Terracom are expected to sign an interconnectivity agreement, which has been a source of bickering in recent weeks.

The agreement will be coordinated by the national regulatory body, RURA (Rwanda Utility Regulatory Authority (RURA).

The two companies have been undercutting each other's rates in a price war that has resulted in quarrels over connection of some specific numbers. MTN for instance is yet to allow some Terracom numbers on its network.

RURA chief executive, Francois Zimulinda told reporters in Kigali that his agency had hired a team of consultants to help establish rates that telecom giants should charge without exploiting consumers.

Interconnection charges will now be Frw40 (about US$7 cents) for a call from a fixed to mobile phone, while a call from a mobile to fixed phone will be Frw30 (about US$5cents). The consumer will, however pay a little more to cater for taxes and the provider's profitability based on cost-plus pricing.

(SOURCE: East African Business Week)

IN BRIEF:

- The Tanzania Communication Regulatory Authority (TCRA) has officially changed the mobile telephone access codes from six to seven digits. The new mobile network destination codes will commence in July this year.

- Nigerian SNO Globacom has switched on a hi-tech internal communications network linking all Power Holding Company of Nigeria (PHCN) offices and installations throughout the country. Under the same arrangement, Globacom's state-of-the-art telemonitoring facility will enable the power giant (PHCN) to monitor power usage by wireless technology from any location in the country.

TELECOMS, RATES, OFFERS AND COVERAGE

- Subject to the approval of the Independent Communications Authority of South Africa (Icasa), Vodacom will be lowering all its standard in-bundle 3G data tariffs by 20%. “This reduction in tariffs means that Vodacom customers could pay as little as ZAR39c per Meg.

- Econet Wireless, Zimbabwe’s largest mobile operator, signed up 45,000 net new subscribers in January and February to take its total customers to 457,228. Libertie, Econet's hybrid mobile brand, accounted for most of the subscriber growth, with users of the service rising by 80%. Econet now claims to have a 59% share of the cellular market, up from 57% at the end of December, ahead of rivals NetOne and Telecel. It is targeting a total of 500,000 customers by June.

- Tanzania Telecommunication Company Limited (TTCL) is expected to launch a new land and mobile service offering voice and data services on its new CDMA platform. The service known as TTCL Mobile Service will initially cover Arusha, Dar es Salaam and Kilimanjaro Regions. By September this year the new service will spread to all large towns of the mainland and Isles.

MTN RWANDA LAUNCHES MOBILE DATA SERVICES WITH GPRS

MTN Rwanda has unveiled its mobile internet service, a move that seeks to transform the telecom giant from a predominantly voice service provider to a fully fledged telecom solution provider.

Excited mobile phone users with GPRS enabled handsets were attracted to know they could easily subscribe to the service that allows them access to internet everywhere on the MTN Rwanda network.

Officials say subscribers are now also able to access the internet by connecting their personal computers (PCs) to GPRS capable mobile phones or through a GSM/GPRS modem.

"The MTN internet service will carry a fixed monthly charge meaning that once the payment is made, the customer will have unlimited access to the service for a month," a statement issued on Monday said.

"The internet is a revolutionary technology that allows MTN Rwanda subscribers access affordable and reliable internet from anywhere in the country that is covered by the wide MTN network. It is the first of its kind in Rwanda-another milestone by MTN," Albert Kinuma MTN Marketing manager was quoted as saying.

MTN currently covers a geographical landscape of 90% of the entire nation. Subscribers will have to part with Frw 20,000 (US$35) per month for internet services and normal prepaid charges for the voice calls. Post-paid customers will pay Frw 18,000 (US$ 32) for internet services and the normal post paid charges.

Users have the option of Internet access only connections without voice calls for Frw 18,000 (US$32) only as monthly charge.

"MTN Rwanda has set up demonstration stands that are going to be spread across the country to help clients understand the use of the internet service. It is simple, affordable, and reliable and a fast speed internet connection our esteemed clients, must not miss out on!" Kinuma said.

MTN Rwanda is part of the South African based MTN Group Limited, which was launched in 1994 with 20 million subscribers in nine countries across Africa. Recently, the Group announced the successful purchase of a 49% shareholding in IranCell of Iran.

(SOURCE: East African Business Week)

MOZAMBIQUE WINS WIMAX RACE WITH MAPUTO MUNI NETWORK

Rapid Cloud Technology, the Johannesburg-based sub-Saharan distributor of certified WiMax equipment for Canada's Redline Communications, has deployed Africa's first certified WiMax metropolitan network in the capital of neighbouring Mozambique in under five days.

“For Teledata Mozambique, WiMax is all about delivering quality broadband to the local market and providing an affordable alternative to digital subscriber lines and cable broadband Internet access,” says Arnoud de Nooy, Rapid Cloud CEO.

According to De Nooy, WiMax is the best technology to meet the growing demand for reliable and superior wireless broadband connectivity in Africa, particularly because of its relatively low costs, rapid deployment capability, extensive scalability, and capacity to deliver voice, data and video.

Although Mozambique is the first African country to set up a certified WiMax network, commercial services are set to begin only later in the year, and according to two visiting Redline representatives, SA may not be far behind.

“Certification guarantees interoperability and has been a catalyst for WiMax implementations, with Kenya, Ghana and Madagascar set to follow Mozambique in quick succession,” says Simon Wilder, Redline sales director for Europe and Africa.

(SOURCE: ITWeb)

KENYAN FIRM LAUNCHES MOBILE INTERNET SERVICE

Africa Online Limited yesterday introduced a mobile high-speed internet service in Kenya, making it only the second country after South Africa to have such a service. Known as InfiNet Broadband, the service gives users speeds of one megabit per second, nearly 20 times that of a regular telephone connection. Africa Online has invested Sh300 million in the first phase of rolling out the service.

"Rather than buck the trend, we took a calculated risk and the result is bringing a revolutionary product allowing Kenyans to leapfrog into the future," managing director Mr Frederick Murunga said at the launch. Through an agreement Africa Online has signed with Kyocera Corporation of Japan, the company will be able to use Kyocera's "iBurst" technology to boost its broadband infrastructure in Kenya - which would make it just the third country in the world to have implemented this system.

"The new service is simple to set up, and user equipment is affordably priced, even for the small and medium sized businesses," he said. It is unique in that unlike many available fixed wireless solutions, infiNet Broadband is plug-and-play, requiring only an installation kit and the user terminal for connection.

(SOURCE: The Nation)

GROUP OF UGANDA ISPS TO PURCHASE BANDWIDTH TOGETHER

Uganda Internet Service Providers (ISPs) have agreed to consolidate their purchase of bandwidth in an effort to cut down Internet costs, writes Balancing Act’s Uganda correspondent Esther Nakkazi.

Officials from ISPs say it is a business strategy which they are working on only awaiting a nod from the market regulators and other stakeholders which would cut the procurement costs of bandwidth by 25 percent and later push the costs down for the Ugandan Internet users.

“We are trying to bring the cost of the Internet down which we hope will happen in a couple of months. There is a discount for volume so we shall consolidate the bandwidth and buy it at wholesale price,” said Badru Ntege, the chairman Uganda ISPs Association.

The price of Internet in Uganda is still very high to everyday users at Shs.25 per minute limiting Internet use and growth basically affected by expensive bandwidth sold by a few ISPs, which say they too are buying capacity via satellite and it is very expensive.

A survey for Internet development in Uganda published in October 2005 by the regulator Uganda Communications Commission (UCC) said at least 80 percent of Internet users in Uganda consider it to be expensive.

“The price of the Internet is still high because we are buying capacity via satellite and it is very expensive. The price of Internet will go down substantially but we have not yet calculated percentage reductions fro consumers,” said Ntege elaborating that it is only ISPs under the umbrella of Uganda ISPs association that are in the deal.

According to the regulator, UCC there are 17 ISPs operating in the country. Ntege says only six of these are under the Uganda ISPs Association that is planning the move- Bushnet, Infocom, Afsat, Africaonline, One2Net and SpaceNet.

Data available shows that each ISP in Uganda can buy up to 2-3 Meg of bandwidth for small ISPs while the big ones procure 5-6 Meg per month. Each Meg costs $ 5,000 -$6,000 to be landed in Uganda.

When they consolidate the buying the association is planning to immediately land 50 Meg of bandwidth at a discount of 25 percent. The price will be affected by volumes and the satellite space segment that would have been reduced by landing the bandwidth in bulk.

I Meg of bandwidth is carried through a space segment of 1.5 Mhz on the satellite dish. With the merging of the ISPs the space segment on the satellite used will reduce and affect purchase prices.

According to an ISP operator he can only resell 1 Meg of bandwidth 3 times to the different channels although he can resell it as many as 10 times to mostly internet cafes.

“This is a matter of contention others resell one Meg up to 4-8 times but this reduces the speed of the Internet and makes the customers very unhappy,” said the operator. The 2005 UCC survey established that most Internet café operators were not satisfied with what they pay to the ISPs for interconnection and they feel it is very expensive.

While the users said the speed in the Internet café is very slow. 80 percent of Ugandans access the Internet through Internet cafes, the UCC survey said.

However, the ISP operator said the Internet Café operators in Uganda do not seem to understand what they are buying, ‘they buy very small bandwidth and connect it to over 20 machines’.

“We are suffering from high costs of bandwidth and the power crisis is making business very unprofitable. The minimum speed can not be guaranteed and then they tell us bust but we don’t know how it even works,” said Josephine of Cyberlink Café in Ntinda.

However, the regulator says they support a clear service agreement between the user and the provider through a Committed Information Rate system.

“The minimum speed should be guaranteed. If the provider does not conform then they can appeal to us and we mediate,” said Patrick Mwesigwa the technical manager UCC.

BOTSWANA INTERNET COMPANIES CHALLENGE BTC-BOTSNET

The country's largest Internet Service Provider, Botsnet and the incumbent, Botswana Telecommunications Corporation (BTC) are being investigated by the Botswana Telecommunications Authority (BTA) after a group of ISPs filed a protest with the regulatory body accusing BTC of bad business practice.

The issue, which is still being investigated, may have far-reaching consequences for Botsnet, including possibilities of confiscation of operating licence, according to observers. The BTC chief executive officer, Vincent Seretse, confirmed to Monitor that a complaint against his corporation's dealings with Botsnet has been filed with the regulatory body but said he was unable to give a detailed report about the issue at press time. Botsnet's finance and administration manager, Maynard Mthetho, refused to comment saying he did not want to get himself into trouble over the issue.

"I don't know who sent you. I am not even sure where you come from. I better not comment. This issue is very sensitive," he said. However, a lawyer at the BTA, Tebogo Tau, confirmed that they are handling a case in which a group of local Internet companies have filed complaints against both the BTC and Botsnet. However, she said she was not in position to divulge the findings as it is still too early t o do so. The concerned Internet companies were not willing to say their names at this time when investigations are still on going. Monitor is informed that top on the list of the local ISPs' grievances are the question of the relationship between Botsnet and the BTC. They allege that Botsnet is a subsidiary of BTC and it was established to have a stake in the new ISP business in Botswana.

They give the example that Botsnet has not been operating like other parastatals over the years as it only appointed a board last year. The complaining ISPs also cite the fact that all of Botsnet board members also double as BTC board members as proof of BTC's vested interest in the ISP. The aggrieved ISPs claim that as a result of the BTC and Botsnet's mother- child relationship, the BTC, which is also responsible for the provision of an enabling environment for ISPs in Botswana, tends to favour Botsnet in their provision of products and services so that Botsnet appears to be the best ISP in Botswana.

The ISPs allege that Botsnet has all the latest services and products that the BTC provides while it is so expensive and time consuming for other ISPs to acquire the same products and services. They say some of those services and products include Virtual Dial-up Network (VDN) or Virtual Point of Presence (VpoP) service, Leased lines, ISDN, Asymmetric Digital Subscriber Line (ADSL) as well as equipment. The ISPs wonder how Botsnet has been able to acquire all the latest services and products in the market while they are offered to other ISPs at exorbitant prices.

The ISPs have asked the regulatory body to investigate whether BTC has a price for Botsnet and the other prices for the rest of the ISPs. They believe that these top range products and services were designed by BTC exclusively for Botsnet because no other local ISPs can afford them. The Internet companies have complained that as a result of the prevailing atmosphere, they cannot afford to be as efficient as Botsnet. They also complain that the prevailing business environment in the country has forced many of them to buy equipment overseas which is extremely costly. The aggrieved Internet companies say the prevailing business atmosphere in the country has resulted in only one company - Botsnet - growing tremendously while others are struggling. It is not the first time that local Internet companies have complained to the regulatory body about the BTC- Botsnet relationship, having filed a similar complaint back in 2001.

(SOURCE: Mmegi/The Reporter)

RWANDA TO HEADQUARTER US$ 280M EASSY FIBRE CABLE PROJECT

Rwanda is set to become the headquarters of the 23-country US$280m Submarine Cable Project according to the outgoing Executive Director of Rwanda Information Technology Agency (RITA), Dr Shem Ochoudho.

Speaking on phone Friday, April 21, Ochoudho who was transferred to the Ministry of Infrastructure (MININFRA), also disclosed that he was appointed Chairman of the six-nation Submarine Cable Project Working Committee.The six countries are: Botswana, Lesotho, Tanzania, Kenya, South Africa and Rwanda.

"I was appointed Chairman during the last meeting of the twenty three member countries in Pretoria, South Africa, that was convened by the New Partnership for African Development (NEPAD). I will chair the committee working on the submarine cable project on behalf of policy makers and regulators of the 23-member countries," Ochoudho said.

He observed that his appointment as Chairman of the Working Committee was a vote of confidence in the government of Rwanda's political will in transforming the country into an ICT hub.

"That is why Rwanda has been unanimously recommended to be the future headquarters of the company to manage the submarine cable (Undersea and Interland)," he said.

Ochoudho, who now becomes the Special Information and Communication Technology (ICT) Advisor to the Minister of State in charge of Communication, also disclosed that he is to swap responsibilities with Peter Fullaton.

"What happened is just a swap of responsibilities and I am ready and determined to execute my new responsibilities diligently and with devotion in order to promote the government's economic development goals in ICT," Ochoudho told The New Times.

He added that the submarine cable will stretch from Durban, South Africa to Djibouti, "with an optical cable along the Indian Ocean." According to Ochoudho, the project will be financed by telecommunications operators, the World Bank and African Development Bank.

(SOURCE: The New Times)

ZIMBABWE IS OUTRAGED AT GOVT BID TO MONITOR PRIVATE MAIL

Zimbabwe's civil society - frantically trying to preserve the country's shrinking democratic space - is outraged by fresh attempts by the state to push a new law, which seeks to monitor electronic mail and Internet access by citizens.

Representatives from the media, Internet Service Providers (ISPs), lawyers and the generality of civil society met in Harare last Thursday and resolved to raise a case against the constitutionality of the Interception of Communications Bill if passed into law. With ZANU PF having a clear numerical advantage in the bicameral parliament, the bill is assured of easy passage. In what amounts to unacceptable invasion of personal privacy, the Bill authorises police and intelligence chiefs to pry into private communications.

Reads part of the draft Bill: "Under this part, the minister is authorised to issue an inception warrant to authorised persons where there are reasonable grounds for the minister to believe (among other things) that a serious offence has been or will probably be committed or that there is a threat to safety or national security of the country."

Among other things, it also orders telecommunications service providers to install hardware and software facilities and devices to enable interception of communications.

Chris Mhike, a media lawyer, described the bill as an unconstitutional piece of legislation considering that the Supreme Court struck out certain sections of the Postal and Telecommunications Act that were infringing on people's freedoms.

ISPs predict that a number of players in the sector would be forced to close shop due to the prohibitive costs of procuring new equipment as demanded by certain sections of the proposed law.

"We are looking at doing a feasibility study on its impact among ISPs but it is clear that a number will wind up because of the huge costs of buying the equipment, which is not available locally," said James Holland, a representative of the ISPs. "All stakeholders should begin now to fight the proposed law by firstly engaging ZANU PF legislators before it is signed into law. I think it is also imperative to petition the President (Robert Mugabe) as was done with the NGO (non-governmental organisations) Bill. If all this fails and it is passed into law, the last course of action is to fight it in the courts," added Holland.

Journalists' representatives described the Bill as worse than the controversial Access to Information and Protection of Privacy Act (AIPPA), which has claimed private newspapers among them the Daily News and its sister weekly The Daily News on Sunday.

Zimbabwe Union of Journalists (ZUJ) secretary-general Foster Dongozi said the union would mount a legal challenge reminiscent of its battle against repressive sections of AIPPA.

"This should be the route we should take if we are to maintain our freedom of expression because it is scary to have our emails and Internet monitored by moles," said Dongozi.

(SOURCE: Financial Gazette)

IN BRIEF:

- Kenya Data Networks (KDN) has launched a broadband wireless service in partnership with local ISPs. KDN has partnered with Internet Service Providers (ISPs) to roll out the service countrywide. Users will be required to subscribe to an ISP to access the service, which is currently available in Nairobi.

MICROSOFT LAUNCHES LOW-COST WINDOWS XP FOR AFRICA

Within days of the official release of the first African language interface pack (LIP) for Windows XP, Microsoft has announced the coming release of a new edition of the operating system that is tailored to the needs of first time users in Africa.

The Windows XP Starter Edition for Africa has been released to manufacturing and will be available to the South African market through a variety of innovative supply channels and payment methods from July, Microsoft SA MD Gordon Frazer told journalists in Bryanston last week.

“We are working with a variety of local and multinational PC makers to find ways of bundling Starter Edition with entry-level machines to deliver an affordable hardware and software package to the local market, hopefully at around R2 000,” said Frazer.

Starter Edition requires a PC with a 233MHz processor, 64MB of RAM, 1.5GB hard disc space, CD-ROM drive, Super VGA resolution video adaptor, and a mouse or compatible pointing device.

Visiting Microsoft EMEA regional president Neil Holloway said Starter Edition was one of several initiatives that represent Microsoft's commitment to providing an information and communication environment for social and economic development in emerging countries.

Windows XP Starter Edition will help grow the use of technology in Africa, says Gordon Frazer, Microsoft SA MD.

Starter Edition is also a part of Microsoft's strategy in the next four years to increase the number of Windows users in 83 countries and bring technology to 250 million people for the first time, which includes doubling the PC penetration in SA to 20%.

“Starter Edition is a direct response to a demand in the region to make Windows more accessible to a greater number of people. It's about providing greater choice in a highly competitive market,” Holloway said. He denied the move was related to the growth of open source software in Africa.

Starter Edition for Africa builds on the success of other regional versions, which Holloway said had done extremely well in countries like Brazil by meeting the needs of lower income groups.

Despite the fact that Starter Edition is in English, Microsoft will ensure compatibility with all African LIPs, such as the isiZulu LIP released earlier this week, said Jonathan Hatchuel, Windows client business group manager at Microsoft SA.

In an attempt to make Windows XP more accessible and less intimidating, Starter Edition features African-style desktop backgrounds, a simplified user interface for easy navigation, large icons, animated demonstrations, and a specially developed desktop help system.

“Starter Edition includes the security, multimedia, Internet and e-mail capability of other versions of Windows XP, except there is no networking or multi-user functionality and users are limited to a maximum of three applications at any given time,” explained Hatchuel.

According to Frazer, fear of feeling intimidated by the operating system and learning how to use it are the biggest barriers to entry for many first time computer buyers and users.

“By adhering to the principles of simplicity and affordability, we believe Windows XP Starter Edition together with our local language programme will achieve greater digital inclusion and grow the use of technology in SA and the rest of the continent.”

(SOURCE: ITWeb)

UGANDA SOON TO JUMP ONTO THE OUTSOURCING BANDWAGON

Since independence, Uganda has been actively engaged in the outsourcing industry, offshoring the refining and value-addition processes of most of her raw materials to Europe and America - to her disadvantage. This sad spectacle is, however, set to change and the country is set to realise its first positive benefits out of outsourcing.

InterGlobal Services (IGS), a U.S. call centre operator in conjunction with the Busoga Kingdom are in the final stages of setting up a 150-seater world-class call centre in Jinja, 80 kilometres east of Kampala.

"We are about one month behind schedule," the prime minister of Busoga Kingdom, Martin Musumba revealed to Business Week, "but it should be up and running by the end of May." The call centre will employ 450 operators, working 3 shifts everyday, and 7 days a week earning an estimated salary of about US$1,000 every month.

The government through the ministry of education entered into an agreement with Global Management Consortium-Trade Information Network (GMC-TIN) and Serebra Learning Corporation (Canada) to provide low cost and affordable education in ICT, professional development courses including call technologies and call centre management through a programme known as EasyLearning.

Serebra, which owns the courseware has over 3,000 courses in its library but only 400 of those have been negotiated into EasyLearning and are accessible at a cost of Ush12,000 (US$6) per course. Rossette Serwanga, the EasyLearning programme manager says that since its launch on January 17, 2006, over 600 people have sat and passed the online courses. Busoga Kingdom set up an e-Learning centre in Jinja called IT Synergies, where they have been training the future call centre operators and managers and are now set to run the first outsourcing centre in the country.

(SOURCE: East African Business Week)

GAMBIA GETS A TECHNOLOGY CENTRE

The West African Council for Science, Technology and Development Centre (WASTDC) has been established in Banjul to undertake tasks on related problems in collaboration with other West African countries.

According to Riaz Mirza, a businessman and the vice president of the executive committee of the WASTDC, the centre will establish a network in and around West Africa to take up problems in science, technology and development in collaboration with other west African countries. He noted that the centre will have close interaction with universities, and research and development institutions to acquire relevant data and information on issues relating to science and technology policy and development. He added that the centre will also provide training for scholars and government functionaries from West Africa and other developing countries in science and technology policy, and organise seminars and conferences on technology and economic development and social change with the support of governments, NGOs and international agencies as well as publishing quarterly update on technology and development-related issues in the sub-region.

Mirza said the centre's scope of work will cover international technology transfer, application of science and technology in traditional sectors, new technology and its application in goods and services, and the establishment of computerized database on technology and industry in West Africa. Because of the wider network of the centre's activities in the sub-region, he said, it is likely to take up big projects to the tune of several millions of dollars, sponsored by international agencies and non-governmental organisations.

(SOURCE: The Daily Observer)

AFRICA URGED TO TAKE UP INDIAN US$55M ICT DEVELOPMENT OFFER

Information and communication technology (ICT) gurus meeting last week recommended that Africa should take up the US$55 million offer by India to develop ICTs across the continent over the next five years.

The deal is subject to approval by individual African countries, who should conclude bilateral agreements with India prior to AU consent. But under the transaction, India has proposed to connect 53 member states of the African Union by satellite network (VSAT) and fibre optics to provide mainly tele-medicine and tele-education services.

The programme comprises an e-component connecting universities and hospitals, as immediate instances, plus capacity building by India, which over the five-year period would supply, install and maintain the equipment. India will also provide expertise, as well as transfer it, after which Africa would be asked to take-over. The project is aimed at providing Africa with a vital modern tool for the provision of e-services. It will also improve the use of ICTs on the continent, necessary to bridging the digital divide in Africa, as well as moving towards the attainment of some of the Millennium Development Goals in education and healthcare.

(SOURCE: The Herald)

SENEGAL WANTS TO BREAK IN THE CALL CENTRE BUSINESS

Senegal's attempt to break into the European call center business has not been easy In the blue-carpeted office of the PCCI call center, young men and women sit before banks of glowing computer screens, murmuring softly into the telephone. The French callers at the other end of the line don't realize that their call is being answered from 2,500 miles away in Dakar, Africa – from a cement and glass building tucked away at the end of a dirt road in a suburb of the Senegalese capital. Welcome to the latest phase of globalization touching Africa.

An undersea electronic highway along the coastline, along with a plentiful supply of French-speaking workers, has enabled Senegal to break into Europe's emerging call center market. But the poverty-stricken country's weak infrastructure and the protectionism of its former colonial power France remain major obstacles to a prosperous future. In a historic irony, the perceived "threat" to French jobs comes from the country's one-time supplier of slave labor.

Some 600 years ago, Europeans landed on Senegal's sandy beaches in search of slaves and gold, and dragged the country into the most sordid phase of globalization. Even when slavery was abolished in the mid-19th century, French colonial rulers forced former slaves into the army. The so-called "Tirailleurs Senegalais" fought for France as late as the 1950s. Now France, worried about its own rising youth unemployment, has little use for the former colony and its unemployed workers.

In the face of intensified global competition, French companies have sought ways of cutting costs by off-shoring production and outsourcing some business processes, especially client support and promotion. This is where a French-speaking former colony, like Senegal, or protectorates, like Morocco and Tunisia, come in. Some 10,000 of France's 250,000 call center jobs have been outsourced to these Francophone countries.

The combination of a French education and a high unemployment rate (40 percent) lends Senegal a grim competitive advantage over other Francophone countries hungry for outsourced jobs. (Unemployment is 10 percent in Mauritius, 15 percent in Tunisia, and 20 percent in Morocco) Senegal-based call centers now provide receptionists for French doctors, lawyers, and bankers. Tele-operators of the Premium Contact Center International (PCCI), for example, also enlist new customers for telephone and internet service providers and conduct telephone surveys for clients.

"We launched our operation by offering a price 20 to 40 percent cheaper than in France," says Abdoulaye Sarre, the soft-spoken CEO of PCCI. He explains that while call center jobs in France offer poor pay and low esteem, in Senegal they hold potential for a whole new career in client counseling with higher than average salaries. Senegal's relatively solid telecommunication infrastructure and location along the path of the transatlantic undersea fiber-optic cable (which links Europe to Latin America) allow companies like PCCI to tap directly into the internet backbone. By using inexpensive voice-over internet telephony (VOIP), the company has significantly lowered its costs.

PCCI started in 2002 with between 30 and 40 employees; it now employs about 1300 people. The client base has risen from a mere couple to a dozen, ranging from telecom operators to internet service providers to mail-order companies. Sarre, for his part, says growth is propelled more by quality than cost. The companies risk their brand name by outsourcing customer care to vendors like PCCI and will do so only with the assurance of quality service.

Once hired, the PCCI employees are trained in neutral accented French and general knowledge about France. At the end of the training, an employee should also be able to recognize regional accents.

Further, workers must be aware of the latest regional developments; for instance, Sarre explains, if there were a major accident – a factory explosion, say – in Tolouse, then callers should know not to dial that area. Every morning before the employees sit at their computers and telephones, they are briefed on two or three major developments in France and check on the regional weather reports. "Today it is raining a lot in the Calais region, and people tend to stay indoors so it is probably a good time to call," explains Sarre.

The average call center salary of US$220 to US$275 a month is more than five times the average in the country. Understandably, then, the call centers attract the best and brightest of the university graduates. At PCCI, the salary can be supplemented by the classic capitalist tool of incentives. If a telemarketer surpasses the assigned target, a white envelope containing a crisp CFA 5,000 bill (about US$10) is ceremoniously handed over amidst general applause in the hall.

(SOURCE: YaleGlobal Online)

IN BRIEF:

- The tendering process for the award of the computerised driving permits to Face Technologies was marred by irregularities, investigations by Uganda Parliament's finance committee have revealed. The committee recommended that the project should only continue if URA is responsible for approving the design, processing, issuance and control of the database. Face Technologies is a South African company and was awarded the tender by the works, transport and communications ministry.

- The Guan land of Ogun State is to experience a near 'Silicon Valley' as hardware vendors in the Nigerian IT industry have intensified efforts to build a multi-billion naira business district in the town. This is following complaints by the stakeholders in the industry that the Computer Village Ikeja and the Tinubu Square Lagos Island where computer accessories are sold are still unfriendly to corporate business environments.

- Kenya Commercial Bank last week launched the mobile phone-based banking product dubbed KCB Connect. The product will enable KCB account holders to access details of their accounts through short message service (SMS) through their phones. The product attracts a Ksh.25 transaction charge.

FIRST PROFIT IN SIGHT AT LAST FOR CELL C

Cellular operator Cell C has grown revenue 34% in the past year and is finally within sight of making a net profit from its 2,9-million subscribers.

For the first time in its five-year history, the network posted an annual profit for earnings before interest, tax, depreciation and amortisation (Ebitda). Its Ebitda surged into positive territory of R489m after a R46,6m loss last year.

Chief financial officer Muhieddine Ghalayini said the gross profit margin of 8% for the past year was "healthy" and a net profit could come soon, depending on how well the rand performed in servicing its foreign debts.

Capital expenditure has passed its peak, as its network rollout is almost complete. While Cell C will continue to upgrade its coverage, it will not need any additional funding after raising €625bn in high-yield bonds and negotiating a R500m credit facility with Nedbank.

For the year ending December last year, Cell C's revenue hit R5,5bn, up from R4,1bn. Cell C held its own against its far larger rivals, MTN and Vodacom, by retaining a 10% market share, with CEO Talaat Laham saying its figures would look better if the operators agreed on how to report their subscriber numbers to avoid exaggeration.

He said Cell C subscribers were up 32% from the 2,1-million reported a year ago.

Laham says its joint venture with Virgin Mobile, which will offer a new range of packages aimed at high-spending users who are now locked in with Vodacom and MTN, should aid sales growth.

Virgin Mobile's launch will come shortly before the introduction of number portability in September, which will allow users to switch networks but keep their existing number.

Cell C's Arpu has risen from R142 to R147 a month as it won more high-spending users. That puts it on a par with Vodacom's R147, with both lagging behind MTN SA's monthly average of R164.

(SOURCE: Business Day)

BYTES READY TO SPEND ITS CASH HERE AND ABROAD

Solid results from Bytes Technology are laying the foundation for a year of strong acquisitive growth. The group plans to beef up its core skills locally and to expand abroad.

Bytes has already made three acquisitions since its financial year end, and is further depleting its cash pile by paying a 45c dividend to shareholders.

Results issued yesterday show revenue of R3,47bn to February 28, up 19% from R2,9bn. Its R181m profit was a massive turnaround from last year's loss of R38m, which had mainly been inflicted by poor performance from its UK division. Its UK operation recovered to report an operating profit of R18m. Headline earnings a share of 127,7c were 48% up from 86,4c, and its cash pile stood at R98m.

Since Bytes' share price had risen by 70% in the past year, its dividend has been increased to ensure the yield was still acceptable, said CEO Dave Redshaw. The handout of 45c is up from 32c, and will cost R70m.

When the company reported its interim results in September, Redshaw said it was looking to expand locally and in the UK as all its divisions were on track and profits were rolling in.

That plan has begun, with Bytes spending £4m to buy a Xerox company in the UK, and spending R7m and R3m on local companies offering e-learning software and telephone management technologies.

Bytes was looking to buy general information technology players, possibly in the field of medical aid switching, where a handful of players are competing for limited business. Its healthcare technology division, DHS, is also negotiating in the Middle East to supply a technology system that links medical practitioners with medical aid schemes.

Redshaw's plan for the UK is to become the biggest partner for Xerox, which it could achieve by acquiring two or three companies.

"With Xerox UK, we have a good relationship. Xerox is very happy to have us as a significant player there because it's a very fragmented market."

Bytes' Xerox division contributes about a third of its overall revenue and, since it dominated the market in SA, the only way to capitalise on those skills was to expand abroad, he said.

Bytes was also assessing opportunities to acquire other UK technology companies, including a systems integration player.

"I think the time is right. The exchange rate is as good as it's going to be and the UK economy is pretty reasonable."

Redshaw said he was happy that its recent acquisitions had seen the company borrow money, as it also generated cash rapidly through its operations.

"We generate cash quickly and spend it as fast as we get it. My aim is not to have a cash pile.

"Our cash flow in the coming year will be seriously positive unless we make a really major acquisition so I'm happy to borrow as long as I can pay it back."

Further local acquisitions of both private and listed companies are being negotiated, though none is at a sufficiently advanced stage for Bytes to issue a cautionary notice.

SOUTH AFRICAN FARITEC BRUSHES OFF TARGET'S LEGAL WOES

Technology company Faritec's R54m acquisition of black-owned Enterprise Connection will not be affected by legal action that has been instigated against the target company.

A notice issued by Faritec on Friday had triggered some calls to the company by investors concerned that the legal action would affect the deal, said Faritec CEO Simon Tomlinson.

Tomlinson said the technology rental financing company that brought the action had insisted that the notice was issued on the JSE's news service to embarrass the company so as to force it to settle the dispute.

The dispute involves less than R1m and was fully disclosed to Faritec when it negotiated the takeover of Enterprise, which supplies technology equipment to corporate clients.

"The rental financing company says it has a claim against Enterprise and that has been excluded from our deal. It will have no impact on Faritec whatsoever because we are buying the business out," Tomlinson said.

If there was a valid claim to settle, it would be the responsibility of Enterprise shareholders in their personal capacity, he said.

An interim court order obtained by the claimants against Enterprise prevents the takeover from being concluded before May 30.

Since the move would only come up for approval by shareholders and the Competition Commission at the end of next month, the legal action should not create a hold-up, Tomlinson said.

The main shareholders in Enterprise are its CEO Paul Moses and four black businessmen trading as Canal Square Investments with 50%.

Once the deal is concluded, it will almost double Faritec's staff size, expand its offerings, and boost its empowerment profile. Tomlinson said plans to integrate the operations were going well. Faritec's share price was unchanged on the JSE on Friday.

(SOURCE: Business Day)

IN BRIEF:

- Investcom has announced that it has finalised the terms of its increased ownership in its Yemen and Sudan subsidiaries. Investcom agreed to acquire an additional 30% interest in Bashair Telecom Co., its Sudanese operations. This transaction takes Investcom's total stake to 85%. After just five months of operations in Sudan in December 2005, Investcom has reached gross operating revenues of more than US$20 million with a market share of 12%.

- The Egyptian Company for Mobile Services (ECMS), which offers services under the brand name MobiNil, has reported a 21% hike in net profit for the first quarter of 2006, up to EGP311 million (USD54 million), on the back of a 14% rise in revenues to EGP1.4 billion. EBITDA rose 11% to EGP702 million. MobiNil launched EDGE services during the quarter and introduced Egypt’s first pre-paid call plan offering per-second billing. It ended March with 6.965 million mobile subscribers.

SMS DATING SERVICE WINS LOVERS IN KENYA

Muthuu Kagio is not as flirty as you would expect. The proprietor of Narob Systems, a city-based Short Message Service (SMS) dating services company, says he is simply a businessman. "I got into the mobile dating business purely by coincidence," says Kagio. "Initially, I was very interested in value-added SMS services."

He first toyed with mobile commerce, or m-commerce, but he could not find market for buying and selling using cell-phones locally. And after several market surveys, he fell in love with mobile dating and he is glad he did.

"I began by doing a market test where I would place an advert in the classifieds sections calling for willing partners for dating," he said in an interview at his Aqua Plaza offices on Murang'a Road, Nairobi. The response was an overwhelming 200 text messages on the first day, not a small number for a start-up trying to find a spot in a community where dating is for the most part sacred and secretive. The other SMS services he tried only got an average of 20 responses a day, he says.

Mr Kagio says the dating service was the result of his innovation and is the latest in the growing roaster of SMS value-added services that are rolled off the two networks by the day.

His is purely an entertainment service and one must be 18 years and above to be registered. "We get about 200 and 300 SMS messages a day depending on the number of people newly informed of the service," says Mr Kagio.

Mobile virtual dating services allow men and women to create a profile, search for dates and start conversations through SMS messages. The application developed by Narob Systems enables users to meet potential partners by just sending a simple SMS. To get started, you have to register by sending an SMS containing your name, age, gender and your preferred task. For instance, "Reg Muthuu 30 M looking for a serious partner," then send the message to a premium number 5288. Reg is shorthand for registration.

Once registered, to find a date you are required to SMS back the qualities you are looking for including age, gender and any other specifications. "After this you will receive a list of currently enrolled members matching your reference and their phone numbers from which you can choose the one to contact," says Mr Kagio.

As a member, the service allows you to send as many SMS messages as you wish until you get your match. Mr Kagio says other than the registration message that costs Sh40 subsequent ones are charged at the normal SMS rate of Sh5.

Just to prove how the search for love is big business, the service rakes in Sh150,000 in a good month. So far, Narob has smitten just over 10,000 people who interact through the service.

Income is determined by the number of texts send by the members, because mobile phone service provider Safaricom pays him a commission depending on the volume of SMSes passed across.

"If I exceed 50,000 active members the service provider will increase my commission to Sh19.23 per SMS," says Mr Kagio. He currently gets a commission of Sh15 for every SMS send by a new date-hungry member. Mr Kagio is looking to increasing the number of subscribers to more than 50,000 by year end. The 30-year-old businessman who tried the same service in America, where he went to college, says even though the job is challenging he loves the experience. And for those who think it a jokers' club, Mr Kagio says has research findings that shatters that perception.

"Those using this service are serious people who have serious businesses going around in their lives," he says. "I was pleasantly surprised that the first person I met was a university student." Mr Kagio was born in Nyeri and later went to college in America, where he trained in business administration.

He plans to try his luck again on mobile shopping, the first of its kind in the country, where people can buy and sell goods through their cell-phones.

"Considering the number of active mobile phone users in Kenya, this is enough to warrant a try," Mr Kagio says of the service. The market is not too small, he says, and can to be nurtured to grow. "Mobile virtual services are like bringing classifieds into your pocket. A mobile is a personal gadget and is convenient," he says.

He, however, bemoans the high cost of running such services, especially charges by local mobile providers. "I pay Sh25,000 every month to my mobile provider," he says.

To cut down on costs, Mr Kagio says the company's server running the SMS service is hosted in America where it is cheaper. "Hosting it in Kenya is very expensive because the charges are Sh15,000 a month compared to the $60 I pay in America." He has hired young techies who make sure every member gets their date.

(SOURCE: The Nation)

UGANDA BROADCASTING CORPORATION GOES ONLINE

Uganda Television, now baptised Uganda Broadcasting Corporation (UBC) Television has broken off from their archaic past and leaped into modern electronic transmission.

After payment of a monthly subscription of US$9.95, subscribers around the world will be able to watch UBC TV online. Through online streaming, clients will be treated to the latest menu of news, information and entertainment from Uganda at the click of a mouse.

UBC TV, a former state media tool now transformed into a public service broadcaster is the first Ugandan television station to conduct internet online streaming. From any part of the world, Ugandans in the diaspora and other interested streamers around the world are now able to watch local programming over the internet.

Parliament passed the Uganda Broadcasting Corporation Act that established the Uganda Broadcasting Corporation in 2005. This transformed the former Uganda Television (UTV) and Radio Uganda into the now existent Uganda Broadcasting Corporation. The corporation started its activities on the 16th November 2005.

During the launch of UBC TV under the tag line, 'Uganda's preferred network' at their transmission station on Nakasero Hill in Kampala last week, the managing director Mr. Edgar Tabaro said the station is to become a center of excellence.

"UBC TV is on the internet. It is the first television in Uganda to do broadcasts over the internet through internet streaming. You can log onto www.jumptv.com," said the MD.

Opened in 1963, a year after Uganda's Independence, the then UTV was the only Television station producing a host of local programming and broadcasting to the public. Throughout the years since Independence, Uganda has largely been plagued by civil war. As a result, many institutions including the national broadcaster (UTV) were reduced to a rundown state.

(SOURCE: East African Business Week)

MY TV LAUNCHES SERVICES IN ABUJA

My TV, a newly established direct-to-home (DTH) satellite television broadcast operator has launched its multi-channel services in Abuja, Nigeria's Federal Capital Territory (FCT).

The outfit promises to break the monopoly currently enjoyed by DSTV in Sub-Saharan Africa by meeting the television viewing needs of the African family with it array of entertaining and informative channels delivered at relatively cheaper rates.

The channel line up includes BBC World, Eureka! (For 6-12 year-olds), Baby TV, Trace TV, MCM Top, Adventure1, Fox Sports, Fashion TV and a Barker Channel. Other Channels, including sports, movies, children and music programmes will be added in due course.

"We recognised that most African families have access to only one or two terrestrial television services and many cannot afford the cost of the existing pay television propositions, yet all our research shows that people would like a greater choice of family entertainment. Consequently, we set out to build a pay television platform with high quality family oriented channels that people can afford and with simple methods of subscription and renewal payments.

In addition, we recognise the need to ensure that the satellite receiver is as versatile as possible; it should be able to receive available free-to-air channels without any restrictions," said John Tydeman, Chief Operating Officer of the firm.

My TV is relayed via the PanAmSat (PAS) 10 satellite and encrypted using the CONAX CAS7 Conditional Access System. This means that only active subscribers can view the channels, using duly authorised smart cards.

The service is complemented by a number of free-to-air channels being relayed via the same satellite, which can be received on the My TV receiving equipment.

Tydeman disclosed that his firm has entered into a synergy with Strong Technologies for the purpose of accessing a range of equipment backed with technical support and service centre facilities in several African countries. These services are however not existent in South Africa, home of its main competitor, DSTV.

(SOURCE: This Day)

PEOPLE

* The Presidents of Rwanda, Tunisia and Senegal have been nominated for this year's ICT Africa awards in recognition of their role in ICT development in their respective countries.

* Nigeria Nitel spokesman and deputy general manager (Corporate Communications), Mr. Tayo Ekundayo, has given notice of his desire to voluntarily retire from the services of the company with effect from 30th April, 2006. He cited his desire to explore new opportunities as his reason for voluntary retirement.

EVENTS