The African ISP is dead! Long live the African ISP!

The African ISP runs the risk of becoming an endangered species. Most of them are small, undercapitalised businesses that exist in the rather tight margin between greedy incumbents and price sensitive customers. The introduction of DSL broadband has shifted the power balance decisively against most ISPs and by the time regulators level the playing field again, there will be significant numbers of casualties. As if that were not enough, unified licences are encouraging  the new incumbent – the mobile operators – to play in this space. Russell Southwood looks at what’s happening and how African ISPs can craft ways of fighting back as the market changes.

Like having a cyber-café, opening an ISP seemed to be the perfect business opportunity. This flourishing of small ISPs was fine when the number of users was growing but as growth has levelled off, most competitive Internet markets have more ISPs that subscriber numbers will sustain. As a result, consolidation is already beginning to occur: the merger of ISPKenya and Wananchi is the first of what will be a number of mergers or closures. Small ISPs have almost no development capital and therefore have little or no ability to roll-out their own infrastructure, either at a local or national level.

A clear sign that scale is a problem is that a significant number of ISPs are multi-market businesses, offering many services and specialising in none: a cyber-café, PC training, selling PCs, hosting and web design. It is all too clear that many do not know exactly which business they are in. The majority are not making technical innovations that affect their business fundamentals, particularly the cost and supply of bandwidth. For all these reasons, there could be as little as a quarter to a half the number of African ISPs in competitive markets in three years time.

The introduction of broadband in one form or another in at least two-thirds of African markets represents both a strong threat and a great opportunity. The introduction of DSL broadband by incumbents has put many of the cards back in their hands. Issues of pricing and supply which had just become settled for dial-up are now all back on the table. And in many countries, the incumbents lost the dial-up round and are determined to squeeze out the troublesome ISPS.

Most are going for a “land-grab” that will enable them to become the majority players in this new market. The exceptions are those that are only doing wholesaling. Regulators have tended to follow in the wake of the incumbents making moves rather than anticipating this shift of power. The net result is that it could be at least a year to two years before they get to grips with this new slew of anti-competitive moves.

But the exciting  part that ISPs themselves are in the main failing to keep up with is the steady ramping up of capacity to customers, where they are at last getting more capacity than the current download speeds for less money. KDN’s plans to introduce ADSL2 are another straw in the wind.

Unified licences – where licensed entities are allowed to do pretty much anything – will allow the big players to move into the internet space with a vengeance.  Mobile companies are currently engaged in the technological equivalent of an arms race. Each is working their way through the alphabet soup of upgrades: GPRS, EDGE, EVDO, 3G, HSDPA. It’s not clear that there is really a business strategy behind any of these moves but the rational part is trying to hold on to their high-value customers. And if MTN Rwanda can get 800 broadband customers in just four weeks, it’s not hard to see that this could lead to there being one less ISP in the market. It’s clear that broadband will largely replace dial-up – Senegal is almost at that point – but few ISPs seem to have a strategy to make this transition. So what might the elements of new business strategy be?

- Wireless broadband offers a number of distinct cost advantages. There is often a price arbitrage advantage to be found at the local loop level. It takes a lumbering incumbent longer to match this price advantage with their inflated staffing levels. If well set, wireless broadband also offers distinct capacity and service advantages. For the ambitious ISP, there is also the opportunity to get almost completely out of the clutches of the incumbent.

- Legal VoIP in the majority of African countries is only a matter of time. At least a dozen are lined up to join the vanguard that have already made the jump. There is a very good price arbitrage opportunity at the international level despite most incumbents having had more years than we care to remember to prepare themselves for this moment. But the opportunity is not just at the international level as national calling is deeply uncompetitive  and there are several retail and corporate opportunities at that level.

- Mobile VoIP is still probably about two years off but the smart will look to offer fixed wireless. Reliance in India was able to leverage its fixed wireless operation into a mobile operator and in so doing rewrite tariffs in favour of consumers. The opportunities are not so large-scale but they exist both within urban areas (particularly outside main cities) and in rural areas. Wireless standard like WiMax look unlikely to be a substitute for their mobile equivalents but may well provide sufficient capacity for smaller scale players. It’s sufficiently interesting for MTN to have rolled out WiMAX for data in two countries and be readying a third. When Africa’s regulators wake up to the fact that there is almost no price competition between the increasingly consolidated mobile operators, what would be easier than to let in a few small-scale players to ginger things up a bit?

- The arrival of broadband has allowed operators to look at delivering new products to users like IP voice and IP-TV. Television content – particularly at the international level – is currently a monopoly whose name is DSTV in the majority of African countries. But such a position is unsustainable and the media regulators will in due course look to introduce a bit of competition. Several African countries had problems obtaining World Cup rights and in a football-mad continent, this might surely become a “bread-and-butter” issue. What’s the media equivalent of a cyber-café? A bar showing pirate TV content. Surely much better to sell to these places at a reasonable price and create a legalised market.

Not all of the elements above may be relevant in all countries. They may not play out as suggested but even if only one does, now is the time to place your bets.

There are several competing wireless broadband standards:TD-CDMA/UMTS-TDD; Wi-MAX; Flarion’s FLASH-OFDM OFDM. TD-CDMA is owned by IP Wireless, which is a partner of UT Starcom (developer of UMTS standard). FLASH- OFDM is owned  by Flarion which is in turn owned by Qualcomm, keepers of CDMA mobile voice standard. The Wi-MAX alliance is an industry alliance that includes Intel. It is planning to release a Wi-MAX enabled chip for laptops next year. One of the two Wi-MAX standards is able to offer fixed wireless. TD-CDMA has a number of implementations on the continent including douala.one in Cameroon and Sentech in South Africa. Wi-MAX is has the most implementations on the continent and is already being used to deliver satellite VoIP payphones in DRC. By contrast, FLASH-OFM is nowhere to be seen.

Wireless broadband seems to be able to deliver greater data capacity at a lower cost. Opinions vary considerably but those that have “got their hands dirty” estimate that it is about 15-20% cheaper per subscriber than current equivalents. It can offer a relatively stable VoIP platform and if you offer fixed wireless, it’s surprising how much mobility can be achieved: just the sort of mobility that local cab companies and private security companies will almost certainly find attractive. Kenya’s KDN “butterfly” service will eventually combine Wi-Fi and Wi-Max and be able to offer voice mobility. The question is then whether mobile companies will work with KDN or it will go its own way.

This road is not with out obstacles. There will need to be cheap wireless-enabled handsets but since this implementation will probably cost $1-2 then it cannot be that far off. Nokia’s current VoIP phone is aimed at high-end corporates to protect its other markets but this is how everything starts: the question is how long before the downward migration starts? There are spectrum allocation issues that are more to do with who currently has acquired spectrum in some countries rather than fundamental issues around allocation. Finally there is network investment costs. The pessimists (who strangely are nearly always mobile voice standard promoters or mobile companies) argue that the costs will be the same or more. The optimists believe that data-derived standards are more robust for IP voice and will work well so long as no-one tries to launch a mobile company equivalent with millions of subscribers. We shall see….

So what of “triple-play”? Once “real” broadband is in place it will be possible to provide VoIP and media content as well as Internet access. There are already nearly half a dozen countries testing IP-TV including: Sonatel (Senegal), Gamtel (Gambia), Telkom (South Africa) and Mauritius. The operator at this point is a delivery vehicle, not really a content provider but that might change. The current race is for incumbents to provide cheaper delivery to DSTV first and then other content operators. For ISPs, the opportunity has to be to leverage their relationships with their customers to offer a wider service offer.

So what are the requirements of this new business model for ISPs?

- Markets with only 3-5 main competitors where a strong market position (reflected in customer numbers) can be leveraged to sell other services.

- Opening up growth in new markets. For example, the number of satellite TV subscribers is often considerably larger than the equivalent for the Internet. The aim is to create larger subscriber bases that will grow with the economy.

- Getting outside the capital city. In a number of African countries, there still exist significant opportunities in other cities and towns. Stop taking just the cream, try getting some of the cake.

- Creating more complex service offers to cover range of needs (home, mobile, office, content, voice)

- Selling use-value to consumers, not technology. ISPs are often set up by engineers that are fascinated by the technology itself. Start asking what it does for customers.

- In more competitive markets, find the lowest price infrastructure suppliers – use them to drive down the cost of main commodity, bandwidth

- Have access to capital (Probably $1 million but maybe more…)

African ISPs have to ask themselves will you watch this happen or will you make it happen? You have to make the choice yours.

ROW OVER MTC OWNERSHIP IN NAMIBIA

The Ministry of Works Transport and Communications supports the move by Telecom Namibia to own a 51 percent shareholding in MTC after the dismantling of Namibia Posts and Telecom Holding Ltd (NAPTH).

Once NAPTH is abolished, the current law, the Posts and Telecommunications Companies Establishment Act No 17 of 1992, will have to be reviewed to provide for the ownership and the creation of subsidiaries.

This law does not apply to NAPTH and that is why the holding company, instead of Telecom, owns MTC. A ministry discussion document on the restructuring of NAPTH of September 2005 said "Regarding the ownership of MTC shareholding, strong arguments were advanced by Telecom that MTC had been created in 1995 as an initiative of Telecom, but, due to a limitation in the empowering legislation, Telecom could not directly own MTC shareholding. That is why it was owned by NAPTH.

At the same time, NamPost argued that it is entitled to accrue value from MTC since in the past 15 years MTC was run by NamPost's holding company NAPTH, which is to be abolished.

MTC Managing Director Bengt Strenge said he fears the move will negatively affect the dividends that the mobile telecommunications declares to the government but also the dividends that would have accrued to its Black Economic Empowerment partners and its strategic economic partner (SEP).

Its management briefed the Parliamentary Standing Committee on Economics, Natural Resources and Public Administration about the operations of MTC during which it expressed concerns about plans to be declared as a subsidiary of Telecom. He took issue with the planned takeover by Telecom, labelling it "a way of getting our cash".

Strenge said MTC's proposal was to have the three companies MTC, Telecom and NamPost to be 100 owned by the government to enable them to be monitored and also to ensure that they pay their dues.

Out of four findings of a ministerial task team and the report on the restructuring of NAPTH, the ministry said it supports that Telecom owns 51 percent in MTC provided the board of directors of MTC are appointed in consultation with the Cabinet and also that dividends declared by MTC are apportioned to Telecom in proportion to the 51 percent shareholding and are declared to the government without set-offs or deductions.

The other options that were considered were that the government own 51 percent shareholding in NamPost, Telecom and MTC, while NAPTH is converted into a property company owned by the three companies, and that NamPost and Telecom be owned by the government directly, while NAPHT is converted into a property company and that Telecom owns 51 percent of MTC.

The other two options were that NamPost, Telecom and MTC have 51 percent shareholding and the property company be owned by the government with the last option being that the current structure with NAPTH as holding company for the three companies with 51 percent shareholding be retained.

The proposed name of the property company is Namcom Properties. A discussion document on the restructuring of the NAPTH says major challenges were identified to overcome the terms of directing the restructuring process. By July 2006, Portugal Telecom will have a 34 percent shareholding while 15 percent of the stake is still outstanding for BEE partners with the rest owned by NAPTH.

In the latest twist, a document submitted to Cabinet in September last year proposed the creation of a trust fund to hold 10 percent of the shares for state sponsored institutions and programmes, watering down the BEE stake in MTC to 5 percent.

"In respect of the 15 percent earmarked for Black Economic Empowerment groups, a discussion and consultation were embarked upon to determine the way forward. Cabinet directed that 10 percent of the 15 percent be reserved for existing government sponsored institutions and programmes and the remaining 5 percent should be alienated to BEEs," it added.

While the restructuring would cost government lots of money and cause job losses due to the transfer of property, Strenge said, "Profit transfers from MTC to Telecom will be negative for our BEE partners," He added, "MTC feels dividends won't go to the government." He also said that the move was profit driven because normally groundline networks were not known to be very profitable. Worldwide, groundline operators also own mobile networks because they are more profitable.

For example, this year MTC declared N$80 million in dividends to government while Telecom declared N$12 million. While Telecom has 87 customers per employee, MTC has 1 569 clients per employee. If the cabinet approves the restructuring, Strenge said the money that MTC would declare to the government and its BEE shareholders would decrease. Strenge said other challenges that lie ahead of the company are delays in the new legislation, which is supposed to create a regulator for all companies dealing with communications.

(SOURCE: New Era)

GSMA PUSHES "3G FOR ALL" PROGRAM

Following on its moves to create ultra low cost GSM handsets, the GSM Association is now embarking on a new program called "3G for all" designed to make 3G handsets and services more accessible to people in developing countries. The GSMA plans to establish a core set of common requirements for 3G handsets over the next few months in an effort to help mobile phone suppliers rapidly bring down the cost of manufacturing devices. This is an interesting proposition so soon in the 3G game. GSM technology has been around for more than 10 years, and vendors have gotten the price of those phones down to less than $30 wholesale in the ultra low-cost segment. There is no word on how low the GSMA would like to see 3G phones wholesale for, but you have to wonder how low it can go when vendors start adding more than just voice service.

And how low will operators be willing to go with multimedia pricing? GSMA CEO Rob Conway said the group's 3G handset initiative will allow far more people to take advantage of the video clips, mobile music and other multimedia services that are used by more affluent users in the developed world. You would think users in under developed regions would choose putting food on their tables over downloading the latest music. There's just not a lot of disposable income. Remember too that 3G brings significant enhancements to voice capacity.

(SOURCE: Fiercewireless)

MOROCCANS STILL PREFER PAYPHONES FOR INTERNATIONAL CALLS

While Morocco's GSM penetration exceeded 40% in 2005, some 80% of GSM users are still using payphones for national calls. A new Arab Advisors Group major survey of GSM users across Morocco avails deep insights into the usage habits of this predominately prepaid market. The survey revealed that while a substantial portion of GSM users in Morocco (47.1%) use the GSM service for International calls, a larger number prefer to use a payphone.

As Morocco prepares to award new 3G cellular licenses in 2006, the upcoming cellular operators, and the GSM incumbents, must address the low usage levels of prepaid GSM users in the country to enhance the prospects of success. The average monthly minutes of usage for prepaid GSM users in Morocco is less than 20 minutes compared to more than 350 minutes for GSM postpaid users.

"Inducing more traffic on the cellular networks is a must for new and existing operators in Morocco" Andrawes Snobar, Arab Advisors Sr. Research Analyst commented. "At less than 20 minutes per month, Prepaid GSM usage is very low in the country. The survey revealed that a majority of GSM users still use the payphone services. As such, the onus is on the existing operators and the new operators to increase the traffic on the GSM networks through traffic migration from the fixed networks as well as inducing more traffic".

Arab Advisors Group's major analytical survey of Morocco's main cities' population was scientifically done. The survey involved face to face interviews with 700 respondents from different households in Grand Casablanca, Rabat/Sale, Agadir, Marrakech, Tangir/Tetouan, and Fass, selected randomly in a manner proportionate to the population size of the different areas. Respondents were above 15 years old, and were GSM service users. This random survey is of the current GSM users in Morocco, and not the total population of the country. Morocco's GSM penetration stood at 40.8% by end of 2005.

"The results of the survey revealed that only 15.1% of all respondents had changed their mobile operator before. This survey also revealed that a majority of users believe that the service of the existing GSM operators are good to very good." Mirna Sunna, Arab Advisors research analyst commented.

Still, the survey revealed that 37% of GSM users would consider switching their current mobile operator if a new operator is available in the market with another 28.6% may consider changing operators. Their decision to change would depend on better rates and packages (74.7%), and better quality of service (73.6%).

(SOURCE: Cellular News)

NIGERIA’S UNIFIED LICENCES: SMALLER PTOS AND NITEL UNLIKELY TO CHALLENGE BIGGER PLAYERS

A recent report by eShekels has identified the scale of the mountain the smaller unified licence players will have to climb if they are to meet their promises. To start with, all the PTOs plus NITEL have only 7 percent of the market according to a recent report by Nigerian telecom consultant, eShekels. It is difficult to see how these could compete with an MTN, which has a market share of 41 percent. Globacom has market share of 24 percent and Vmobile, 22 percent. Mtel's share is 4 percent.

It has been confirmed that the traffic exchange between the PTOs and the GSM operators is just about 3 percent. The most calls are from one GSM operator to another. Now, between them, the GSM operators have 93 percent of the market. It is difficult to imagine what kind of competition the remaining operators with a total 7 percent of the market could put up.

This Day found out in the course of writing this piece that a GSM operator, especially a big operator like MTN could actually offer call for as low a cost below N5 and still be profitable. Yes, the profit would not be the kind that would make investors trip over themselves to rush to Nigeria, but the company would not go hungry either. It would still break even.

The fact of that situation is frightening. It means that if these GSM operators or even one of them decides to offer his service for say N5.50 per minute national calls, then the game is over for the PTOs and all the noise about unified licencing bringing competition would be noise pollution. Remember the cheapest local call between one PTO to another is N6.50 per minute. Take notice also that this remains the only advantage the PTOs have over GSM. The only other benefit is on-net calls. That however is for those subscribers looking for glorified intercom.

If a Vmobile offers call for that low, Glo and MTN must necessarily follow suit. If that scenario happens, the communication authorities would probably first come out to say that is the result of competition they have been talking about; that unified licencing engenders competition. Before they would finish spelling MoC, the PTOs would be all dead. It may hurt them all in the long run, but the GSM operators would have succeeded in sending the small operators to their early graves. They would then start the difficult task of readjusting their tariffs upward again. In a country where the populace is already crazy about mobile phones, that task may actually not be as difficult as theorists suggest.

Or consider the volume. Can anyone compare nine million subscribers to 300,000? On what basis would a Starcomms, with the highest CDMA subscribers compete with an MTN with a subscribers' base in excess of 9 million and moving close to 10 million? Let's take an example. Nearly every Starcomm owner would call an MTN line. Half MTN users may not call Starcomms in a month. It then means that Starcomms makes more money for MTN in interconnect settlement than it even makes for itself. The situation is further worsened by the prevailing interconnect rates which is still skewed in favour of the GSM operators. Where then is the competition?

The current interconnect regime discourages investment in the PTOs. The foreign investors, and some say, even local investors, might not want to invest in the PTOs.

It might not be all gloom for the CDMA operators however if they could leverage in on data provisioning and if they do it well.

The eShekels report on 'Nigeria ICT Outlook and Forecast' referred to earlier reveal that Internet awareness is increasing in the country. According to that report, Internet users in the country now total 3.034 million. But that is less than a fraction of the population, or even the subscribers figure of about 29.3 million by year-end.

The PTOs could cash in on the superior data capability which they say the CDMA technology has. A few of them like MTS First Wireless and Starcomms who have good mobile Internet products have seen how great demand for such products are. That alone could keep them in business, if they do it well. But as for talk about competing on voice service, it might be better for them to allow people talk about other things. Analysts agree that some other things could help the PTOs. Their situation would become better if the NCC would put in place a more equitable interconnect regime.

The NCC should regulate an interconnect tariff that would be more equitable. A PTO described 'equitable' last week to mean that the big operator does not undergo punishment for being big, and the small operator does not suffer perpetually for being small.

Equally important for the PTOs, the NCC should go ahead to name who the dominant operator/operators is/are. Once, in this industry when NITEL was the dominant operator, it was well stated. At the time, government ordered that calls from growing GSM firms to NITEL go for N12 per minutes while from NITEL to GSM operators, it is billed N18 per minute. The smaller operators benefited from interconnectivity than the bigger operators.

The current situation is such that NITEL has become a minor operator. In a matter of few months, many of the PTOs would have more lines than NITEL's decreasing 400,000 lines.

To help the PTOs, operators say there is need to officially declare another service provider or providers as dominant operator(s). That way, the benefits which the GSM operators earlier enjoyed would also be enjoyed by the current small operators.

Then there would be something close to an even playing field. The PTOs may then also just be able to hobble along.

(SOURCE: This Day)

2G WIRELESS IS ALIVE AND WELL IN DEVELOPING COUNTRIES

2G and 2.5G wireless infrastructure is alive and well and living in the developing world. With most mobile telephone infrastructure markets in industrialized nations near or at saturation levels, wireless base station vendors are looking further afield, all the way to China, India, and other fast-growing markets in Asia, Africa and Latin America.

The problem with addressing such markets is their low wage/low price economies. Unable to leapfrog directly to 3G because of its high upfront cost and small cell size, operators in developing markets need efficient and easily upgradeable 2G/2.5G networks.

According to Lance Wilson, ABI Research director of wireless infrastructure research, "The major infrastructure manufacturers have to be very clever in producing cost-effective 2G and 2.5G systems for developing markets, because there isn't a lot of money to spend."

An example cited in the latest market update of ABI Research's Wireless Infrastructure Research Service demonstrates that some vendors are rising to meet the challenge.

Ericsson's "Expander" program requires 30-40% fewer cell cites than traditional GSM networks, promises reductions in both CAPEX and OPEX, has a clear upgrade path to 3G, and is designed to be profitable at monthly subscriber fees as low as US$5.

The update examines the several elements of the Ericsson Expander in detail. "The Expander system allows installation and expansion of 2G/2.5 networks in an exceptionally cost-efficient manner," says Wilson.

This kind of wireless infrastructure appropriate for the developing world is more than just smart strategy; it may help mitigate the effects of the overall wireless infrastructure market trend which, according to the updated forecasts contained in the study, continues to stagnate from an overall standpoint. Only the WCDMA and CDMA2000 1x EV-DO sectors defy the market's general flatness.

(SOURCE: Cellular News)

FREE PHONE SERVICE FOR CAMEROONIAN HIV/AIDS SUFFERERS

People living with HIV/AIDS in Cameroon can now dial a toll free telephone number to access information necessary for their support, according to SUNAIDS, the association that initiated this project. By dialling this confidential, anonymous and free number (821-50- 50), infected persons can get addresses of structures and associations nearest them to seek help.

SIDA-Info, a French association, which donated 150 million francs CFA, and the Cameroon National AIDS Committee (CNLS) that contributed 70 million francs CFA are jointly financing the 220 million francs CFA project. The project has already acquired 5,000 lines offered by the national telecommunications company, CAMTEL, and its officials are negotiating expansion with private operators.

 (SOURCE: Angola Press)

COTE D’IVOIRE’S ORANGE BECOMES LATEST TO IMPLEMENT GPRS

Orange in Cote d’Ivoire last week launched its GPRS upgrade. According to Orange’s Cote d’Ivoire D-G:”This enables us to overlay a new network that will allow us to offer all our clients the use of a number of existing services like surfing the web, sending and reading their e-mails and to receive pictures and photos. It responds to the needs of the market, facilitating our users lives through new services.” The service was offered for free during its initial launch week.

(source: Notre Voie)

BOTSWANA’s BTC SET TO LAUNCH VOIP SERVICE

Botswana’s incumbent BTC is set to launch a VoIP service in the next few months. This is one of several developments designed to make the company more attractive when it is privatised. However, the privatisation may be delayed as the company is currently negotiating to launch a mobile service which may start some time early in 2007. The implementation of its NGN plans have also been put back as the company seeks to offer a far more effective customer service.

IN BRIEF:

- Kenya’s latest fixed wireless operator EM Communications is looking for 20-30,000 subscribers.

- The Senegalese subsidiary of Amitelo has signed a wholesale contract with " Sotelma, the Malian incumbent for international speech termination

- Telecom Egypt announced  that its consortium with Telecom Italia has been qualified by the National Telecommunications Regulatory Authority (NTRA) for the technical component of its bid for Egypt's third mobile license. The consortium is one of nine consortia that will now progress to the final round of considerations by submitting a financial proposal and going through a financial auction

- An interministerial Commission has been set up in Angola to lead the Satellite Telecommunication Project. Among its various tasks, the commission is expected to prepare the Satellite Telecommunication Project, appraise its technical, economic and financial feasibility, follow up its implementation and design its future management system, before submitting it to Cabinet Council for approval.

- Striking workers of the Nigerian Telecommunications Limited (NITEL) have resumed work nationwide following an agreement reached between the unions and the federal government: outstanding salaries for the months of February to April, 2006 will be paid and that other outstanding staff salaries and allowances will be paid immediately after the reconciliation of NITEL's debt.  NITEL's management should immediately pursue its debts owed by Private Telecommunications Operators (PTOs) and that failure by the debtors to settle their debts, their names would be published in national newspapers and also disconnected from the network.

- Zimbabwe TELONE lost over $61 billion to a syndicate of foreigners who allegedly diverted four telephone lines to their residential places and made local and international calls without paying. Between August 2005 and May this year, the men illegally diverted three Harare telephone lines. The matter came to light when TelOne officials discovered the heavy unpaid bill, prompting them to monitor the lines and found out that the bill was emanating from those numbers.

- Gilgil Telecoms Institute’s  (GTI) workers have been issued with letters informing them of termination of their services. The move follows the Kenyan Government's announcement that it was looking for strategic buyers of GTI. The Gilgil firm is a subsidiary of Telkom Kenya, and has been providing the corporation with telephone booths and posts, among other supplies, before financial problems began.

TELECOMS, RATES, OFFERS AND COVERAGE

- Kenya’s is Safaricom planning to roll-out 3G. It is also launching an international VoIP service that will be around 30% cheaper than current rates. The user just dials 880 and then the number required.

- Glo Mobile has given a boost to its customer care operations with the commissioning of an additional 72-seater hall at its ultra-modern Call Centre at Ahmadu Bello, Victoria Island, Lagos.

- Mobile network operator MTN in South Africa  announced a welcome cut in the prices for its prepaid calls. However, the 40% – from R3,20 to R1,99 a minute – cut applies only to the three hours between 17:00 and 20:00 on weekdays. This is a new airtime period – labelled Standard Time – that sits between peak and off-peak times!

- MTN Uganda has made a very clever move by launching a service in which Ugandans living abroad will be able to purchase airtime for their relatives. Customers seeking to use the product have to log on to www.simbashop.com and enter the phone numbers of the intended recipients, their credit card details and then choose the amount of airtime they wish to purchase. The product has been developed in partnership with Simba Telecom and TrueAfrican, who have developed the software.

- South Africa needed a new numbering plan and these changes are being made in terms of a new numbering plan drawn up by the Independent Communications Authority of SA (Icasa) and approved this month by communications minister Ivy Matsepe-Casaburri. It has been mooted that this change be enforced in about 12 months from now but the dates are open to change

SA’S TELKOM ADSL STILL OVERPRICED

Telkom is cutting the cost of its high-speed ADSL internet access services by an average of 24% from August, but the service is still a massive 800% more expensive than comparable international offerings. Users who think the price cuts are generous probably do not realise that SA remains expensive even compared to African countries such as Morocco, say critics. The comments come from MyADSL, the online forum that has become Telkom's nemesis.

The latest MyADSL survey found that the average price for a 30GB service is R441. A similar service from Telkom costs a staggering R3776.

In Morocco, an uncapped, 4MB-a-second (MB/s) service costs R614. Telkom's offering is not only 600% dearer, but is four times slower, at just over 1MB/s.

The survey of 12 countries in all continents found that Telkom's fastest ADSL 1024 service is 600% slower than the international average of 6MB/s.

Last week, Telkom announced price cuts for most of its services, including substantial drops in ADSL line rental. Its retail marketing executive, Steven Hayward, said the new fees would make the lines "much more affordable".

Its 192KB/s service is being phased out and users will automatically be offered the faster 384KB/s service, for a monthly fee of R245. That is down by R114 from the current fee. The rental for its 512 service will be R362, down from R477, while the 1024 rental will drop by R164 to R516.

However, those prices exclude the normal copper-line rental, which goes up by R7,64 for residential and R10,15 for business premises. The cost also excludes the monthly fee that users pay their internet service provider.

MyADSL also assessed the level of broadband penetration in SA compared with other countries, and sums up the situation as "even bleaker". Compared to the 30 Organisation for Economic Co-operation and Development countries, SA comes in last and is three times worse than second-from-the-bottom Greece. SA's broadband penetration of 0,5% is a massive 2700% worse than the average of 13,6%.

"Telkom has promised to adopt a more consumer-centric approach, yet customers continue to pay exorbitant fees for sub-standard broadband services," says MyADSL founder Rudolph Muller. "Recent announcements regarding ADSL price reductions also mislead some consumers into believing that the total cost of ADSL was reduced by 24%." While the access cost will decrease, the line rental and installation charges will rise, so the actual price reduction on a full ADSL service is only 12%, he says.

Independent research house Genesis Analytics believes a 71% reduction in the total cost would be reasonable, agreeing with research by MyADSL that a 72% cut would see SA's ADSL prices fall to within acceptable international standards.

"Unless we see a reduction of around 70%, SA will continue to fall further behind the rest of the broadband world," Muller says. "This will seriously damage the IT industry and economy as a whole. Immediate intervention is required before it is too late for SA to play catch-up." In the past decade, SA has slipped down the ranks of the world's most connected countries from 10th to 37th

(SOURCE: Business Day)

SAFARICOM, WANANCHI IN PARTNERSHIP ACCORD

Wananchi Online last week signed a deal to use Safaricom's infrastructure to provide value added services. The partnership, signed by the Safaricom chief executive officer Michael Joseph and his Wananchi Online counterpart, Joseph Mucheru, at Safaricom House, is part of a drive by the mobile phone provider to popularise the usage of its GPRS and Edge Technology.

Joseph said the new service would also be available to post-paid customers who will access the services at Sh10 per megabyte. The service will later be extended to pre-paid customers at a slightly higher rates due VAT and excise duty charges. Mucheru said service will involve distribution of music from 300 local artists hosting 800 songs in the system.

"In the next few weeks, we also plan to launch an airline ticket distribution service linking 100 travel agencies through Safaricom's EDGE and GPRS network," said Mucheru. Safaricom has been supplying the GPRS/EDGE product through its care centres.

"However, to increase availability of mobile Internet services to subscribers, Safaricom has decided to partner with Wananchi Online to distribute our mobile Internet serves through its network," said Joseph. The technology is currently accessible to about five per cent of Safaricom's clients.

(SOURCE: The East African Standard)

INTERNET SOLUTIONS CHOSEN TO HOST JINX IN SOUTH AFRICA

The Internet Service Providers' Association of SA (Ispa) has accepted Internet Solutions' proposal to host the Johannesburg Internet Exchange (Jinx). Jinx aims to enable Ispa members to interconnect networks and exchange traffic in order to save costs. In 1996, Jinx’s four links boasted speeds varying from 64kBps to 256kBps. Ten years later, link speeds vary from two to over 100Mbps.

Ispa received submissions from Internet Solutions and Telkom in response to its call earlier this year for Jinx hosting proposals for the 2006 to 2009 period. “Ispa chose current host Internet Solutions because the cost for members to connect to Internet Solutions' hosting facilities in Rosebank is much lower than the cost to connect to Telkom's facility in Centurion. In addition, while Internet Solutions proposed to host Jinx at no charge to Ispa, Telkom proposed a significant monthly hosting fee,” says Greg Massel, co-chair of Ispa.

(SOURCE: ICT World)

IN BRIEF:

- Algerian company EEPAD has launched "Assila box" telephony via Internet. EEPAD's first official told a news conference held in Algiers that with this "new product, Algerian double play, will be available within two weeks" as "the first stage is devoted to install it throughout the country's provinces with intend to reach 40 provinces late 2006."

- The Federal Government of Nigeria has set up a company to integrate its existing Information and Communication Technology (ICT) into a national backbone. The Petroleum Development Trust Fund (PTDF) has been mandated to provide about N2 billion ($15 million) to finance the phase one of the company's activities. It will also provide another N25 million towards Galaxy Backbone's incorporation. The proposed national backbone will provide harmonisation and aggregation of bandwidth purchase by the Federal Government for effective planning, monitoring and cost control in line with the economic reforms.

- South African wireless broadband provider, iBurst, says that it has reached the 20,000 customer milestone, growing its subscriber base by 122% in just five months. iBurst coverage is also growing, with a 110% increase in base stations over the same period, the company says. In another announcement this week DataPro has announced that it will offer a “local-only” ADSL solution to the SA market. This offering enables users to use local traffic only, which will dramatically reduce bandwidth costs and optimise online spend. The solution will be priced initially at around R30 per GB, which is less than half the price of current full access offerings.

- MTN Uganda has extended its fibre-optic network to the Mbarara and Bugiri districts of the country. The deployment started in 2000 in Kampala. Further expansion plans will include the northern part of the country.

ANGOLA WINS SPAM AND SPYWARE WORLD CUP

Angola may have a better chance of beating Brazil in the World Cup than the bookies first thought, if research from McAfee SiteAdvisor is correct.  An analysis of screensaver pages associated with World Cup teams and players found that pages linked with Angola contained the highest percentage of risky websites.

The study searched Google for each of the 736 World Cup players, adding the phrase 'World Cup Screensaver' to the search. The results were then cross-checked with SiteAdvisor's database of spyware and spam and the 'winners' were searches that resulted in the highest percentage of risky sites.

Angola beat Brazil 24 per cent to 17 per cent, followed by Portugal, Argentina and the US. The report also found that the most dangerous player to search for is Luis Mamona Joao 'Lama' from Angola, with 45 per cent of first page results leading to questionable sites. Fans searching for Beckham and Ronaldinho face a 30 per cent chance of ending up at a risky website.

"Soccer fans are famous for the depth of their feelings for player, club and country. But sadly the vendors of spyware, adware and other unwanted software know how to exploit this passion for financial gain," said Chris Dixon, director of strategy at McAfee SiteAdvisor.

(SOURCE: vnunet.com)

SOUTH AFRICAN PC USER BASE TO TOP 5 MILLION

The number of personal computers in use in South Africa will pass the 5 million mark for the first time this year, according to a new study released today. The study also found that South African users are holding onto their PCs longer than distributors would have us believe.

PC Users in South Africa 2006, a study by World Wide Worx of the installed base of computers in South Africa, shows that the 4,5-million mark was reached at the end of 2005, and it is expected to grow by 17% to 5.3-million by the end of 2006.

Conducted by Kirsty Laschinger and Arthur Goldstuck, the study also looked at how long PCs, laptops and servers remain in use once they are in the market, and how many are in active use.

"We found that PCs have a life span ranging three to six years, while laptop computers tend to be used for only up to three years," says Laschinger, who interviewed most of the country's major PC manufacturers and distributors for the project.

"It was an eye-opener how many vendors of computers expect all users to replace their PCs every two to three years, when the reality is many users are 'sweating their assets' to get maximum value from the purchase."

The result is that booming sales in PCs means not only more people than ever before using new PCs, but also that PCs already in the field will remain in use for a longer period, further boosting the user base. However, this trend may change once laptop computers overtake desktop PCs in popularity -- a real possibility in the coming year or two.

"Laptop computers cannot be upgraded as easily or as cheaply as desktop PCs, so they have a shorter useful life," says Goldstuck, MD of World Wide Worx. "You can upgrade a PC bought more than five years ago to accommodate current software, but it's unlikely you could do that with most laptops. The result is that old laptops are more likely to be discarded than passed on, while old PCs are more likely to have a second life once the user upgrades."

The net result is that booming laptop sales will not have the same cumulative effect on the total user base as do PC sales. Nevertheless, growth will continue, but at a slower pace, in subsequent years, says Goldstuck.

(SOURCE: Tectonic)

INTEL AND AMD BATTLE FOR LOW-COST COMPUTER MARKET

Intel Corp. and Advanced Micro Devices Inc. (AMD) are taking their fierce rivalry to the Third World. At stake is an untapped emerging market of 3.8 billion people, whose purchasing power, according to World Bank figures, is less than $4,000 per household.

At the recent World Congress on Information Technology (WCIT), Intel disclosed plans to invest about $1 billion over the next five years in its "World Ahead" program, specifically targeting the emerging markets. AMD laid out its own program called "50x15" in 2004, with a goal to connect 50 percent of the world's population to the Internet by 2015.

The competing programs from the two microprocessor giants are not the first attempts by the tech industry to sell computers and connectivity to developing countries. The "$500 computer" a concept unsuccessfully floated more than a decade ago--is another example.

Blaming previous failures on "a top-down approach taken by U.S. engineering teams parachuting down into the Third World," Navi Radjou, VP at Forrester Research Inc., believes prospects may be brighter this time around. "This shouldn't be about a technology device," he said. "This is about a business model, and what kind of broader partnerships or collaborations you can build locally."

In sharp contrast to the early 1990s, today's initiatives appear ready to deliver locally-designed devices and to create a network of local manufacturers willing to build them. Furthermore, appetite for new educational devices among populations in the emerging markets is also rising. Recalling the absurdity of marketing $500 PCs to people with incomes of $1 a day, Radjou said that this time, AMD is partnering with microlending banks to make PCs affordable to rural users. NGOs that the company works with are collaborating with microfinancing agencies to subsidize Internet costs.

But no worthy cause comes without strings attached--usually in the form of corporate technology agendas. Intel, in particular, may face criticism as it integrates WiMAX, its proprietary wireless broadband technology, in every device aimed at the Third World. Some think Intel expects the world to change its spectrum rules to favor WiMAX. Going into the Third World market, said Radjou, to "focus on one technology platform such as that of Intel's WiMAX is one of the pitfalls."  Technology one-upmanship was prevalent onstage at the WCIT last May, as Intel and AMD strutted their stuff before an audience of about 2,100 delegates.

Intel CEO Paul Otellini showed Eduwise, the code name for a mobile computer designed by an Intel team in Bangalore, India especially for Third World students. The little notebook comes with wireless connectivity, a keyboard sized for small hands and a built-in carry handle like the one on a child's school lunchbox.

Otellini's competitive juices were clearly flowing as he described Intel's World Ahead program. "No one wants yesterday's technology," he said, a dig at the low-cost Personal Internet Connectivity (PIC) system that AMD has been providing to schools in Africa, Latin America and other regions for two years as part of its 50x15 program. While AMD's first-generation PIC has a built-in 56k modem and USB ports to add wireless dongles, Otellini said, the World Ahead systems will have built-in WiMAX connectivity as a core technology.

When asked about AMD's wireless plan, Daryl Sartain, director of business strategy for the company's Innovation Solutions group, said, "We are headed toward wireless, and yes, the second-generation PIC will work with wireless modules." He added, "But many of the regions served with the PIC only have phone lines. We are letting their market needs drive us."

Otellini's passionate keynote followed a speech by AMD CEO Hector Ruiz, a native of Mexico whose talk clearly resonated with the largely non-white delegates. Ruiz brought onstage Veronica Kgabo, the principal of Diepsloot Combined School in South Africa, who described how important the AMD-designed PIC systems were to her students. Otellini countered by showing a video of Mexican president Vicente Fox, who thanked Otellini and Intel for a promise to provide Mexican teachers with 300,000 of the ruggedized Eduwise portables. Intel will also provide computer training to about 400,000 Mexican teachers by 2010, Fox said.

Even if AMD and Intel don't expect to make money from their emerging-markets initiatives immediately, they do anticipate a payback one day. Ruiz termed AMD's 50x15 effort as "a business venture, but not a charity," adding that AMD sees much of its long-term growth coming from emerging markets. Ruiz said the 50x15 program is needed to accelerate access. "Without programs like these, it will take until 2030 to get to 50 percent penetration. We can do better than that," he said.

In the 50x15 learning labs AMD has rolled out across the globe, "the focus has been on developing partner technology and communications ecosystems to provide affordable Internet access and computing capabilities," according to an AMD spokesperson. Calling its program a "for-profit effort," the company stressed that PCs are not the only things AMD and its 50x15 partners are investing in. Others include applications and tools that would entice a broader partnership and entrepreneurial business models in each region.

AMD's 50x15 partners include Microsoft, Samsung, Lenovo, HCL in India, Telefonica in Brazil and Cable & Wireless in the Caribbean region.

Intel is pushing a much more focused technology agenda with its World Ahead program. Its vision is that many of the educational computers will be linked to the Internet via WiMAX wireless networks within a few years. Otellini said WiMAX links may extend about 50km, rather than the several hundred meters possible with Wi-Fi networks.

Intel is now involved with about 175 WiMAX trials worldwide, and Otellini skillfully weaved together its WiMAX thrust with its World Ahead program, calling on political leaders to "remove government barriers to WiMAX technology." Intel will spend about $500 million of its own funds on WiMAX-related efforts over the next five years "to finish it out," he said. Worldwide, private companies will invest about $5 billion to deploy WiMAX, which Otellini said "will narrow the difference between urban and rural areas" in Internet access. Now, about 15 percent of the world's population has access to the Internet, but only about 4 percent has broadband access.

Both Intel's World Ahead and AMD's 50x15 programs rely on a network of business partners, NGOs and governments to spread the financial costs. While the virtue of such programs is undeniable, the economic issues are more complex.

Take Intel's Eduwise notebook computer, for example. Mark Beckford, general manager of Intel's emerging-markets platform group, said Intel plans to develop its Eduwise notebook and then contract out manufacturing--initially to a single ODM. Beckford said Intel expects its World Ahead hardware to be priced about 20 percent less than prevailing hardware in regional markets. If a desktop costs $500 in a computer bazaar, for example, the Intel-designed hardware would hit a $400 price target, he said.

Although Intel has mentioned a $400 target for the Eduwise laptop, it is still a relatively high-cost system for Third World nations. By contrast, Linux-based laptops being designed by the One Laptop Per Child (OLPC) alliance backed by MIT Media Lab's Nicholas Negroponte as well as AMD has a $100 price tag as its target. AMD's PIC system, a small machine shaped like a boom box, can now be bought for less than $200.

Intel's Eduwise system would be ruggedized and smaller than a normal laptop, with special software that will allow a classroom teacher to turn on or deny a student's access to the Internet, for example. But can a specially-designed laptop compete with the cost reductions seen in commercial low-end notebooks? For example, Barry Lam, CEO of Quanta Computer Inc., a major notebook ODM based in Taiwan, has been vocal in his support of efforts to extend Internet computing to the developing world. Quanta will reportedly build the $100 laptop for the OLPC alliance.

Or will the Eduwise hardware be subsidized sufficiently by companies, governments and NGOs?

To make a computer affordable enough for rural users in emerging markets, technology advancements alone are not enough. It takes the ingenuity of business models, partnerships and the will of companies like Intel or AMD to make it happen.

Small and large companies have been trying to develop special low-cost systems aimed at the affluent in developing countries. Taiwan's Via Technologies has designed CPUs and systems aimed at the low-cost computing segment. Profits, already razor-thin throughout the PC industry, are difficult in these emerging markets.

On the other hand, the number of potential customers is huge. AMD estimates that, worldwide, there are 500 million households 1.5 billion people with annual incomes equivalent to $4,000 to $20,000 per year. About two-thirds of them live in developing countries such as Brazil, China and India. Another 550 million households, with some 3.8 billion people, are genuinely poor, with annual incomes of less than $4,000 per year.

In any Third World initiative, an often overlooked problem is that "the power grid is always unreliable--you can count on it not working in many of these countries," said AMD's Sartain. While working with Negroponte's OLPC program, AMD developed prototypes equipped with hand cranks to keep systems running during long power failures. Now the engineers are leaning toward foot-pedal power, because cranks are not an efficient solution for students seated at desks and tables, said Sartain.  "It's not easy, but people do find innovative solutions," said analyst Radjou.

 (SOURCE: Electronic Engineering Times)

IN BRIEF:

- Kenya Airways says over 500,000 of its passengers flew on e-tickets over the past 12 months. The airline has so far rolled out 20 stations on e-ticketing within its network. These include domestic routes to Mombasa, Kisumu, Malindi and Lamu. East African destinations include Entebbe, Dar es Salaam, Zanzibar, Bujumbura and Kigali. In North Africa, there are Addis Ababa, Khartoum and Cairo. Other stations that are e-eligible are Dubai, Istanbul, London, Amsterdam, Mumbai, Johannesburg and Cape Town. In separate statement British Airways has announced  the launch of e-ticketing on flights between Addis Ababa in Ethiopia and London.

- The Zimbabwe Deeds and Companies Registry will soon tender for the computerisation of its new offices at Century House in Harare where important information pertaining to company registration would be stored.

SOUTH AFRICAN PINNACLE GETS WORKGROUP FOR R33M

Computer manufacturer Pinnacle Technology is spending R33,4m in a deal that will see it take over information technology distributor Workgroup.

Workgroup is one of the divisions within Explix, which runs a handful of companies in the hi-tech sector. Pinnacle already owns 50% of Explix, and is now buying out two different sets of shareholders to gain full control.

In one deal Pinnacle will pay R25,7m for a 35% stake owned by Hendev, and in the second deal it will pay R7,6m for a 15% stake owned by ITCM Channel Management.

Workgroup has been trading for 16 years and is well established in SA and southern Africa with a presence in Angola, Botswana, Mozambique, Namibia, and Zambia. It is SA's largest distribution company, dealing purely in software, and has branches in Johannesburg, Cape Town, Durban and Port Elizabeth. Its core technologies include the products of Microsoft, Symantec, Corel, Borland, McAfee and IBM.

It sister companies in the Explix stable are Crew, which focuses on the retail market, Merchandise IT, which offers merchandising and marketing services to the Explix group's customers, and Horizon, a southern African channel partner for Sun Microsystems. That task sees Horizon develop the market so Sun can sell more of its hardware and software in the region.

Overall, the Explix group supplies its products to more than 3000 technology resellers, retailers and technology integration specialists.

The company has a staff contingent that is 44% previously disadvantaged, and as a wholly owned subsidiary of Pinnacle it will gain a 30% black shareholding. Pinnacle produces the locally manufactured Proline PCs, but is aiming to offer a broader range of technologies to its clients.

Acquiring the remaining 50% of Explix would increase the number of products it could supply, and would help it to enter new markets, the directors said. It should also generate operational efficiencies and give it the critical mass to expand further into Africa.

Hendev is owned and controlled by Cyril BiddleCombe, the chairman and a large shareholder in Pinnacle. ITCM is owned by the family trusts of three directors of Explix, the industry veterans Dave Lello, Douglas Woolley and Vaughn Parkin. Woolley is the MD of the Workgroup division.

Their vested interests in the deal mean that Pinnacle must obtain independent financial advice to assess the fairness of the takeover transaction.

(SOURCE: Business Day)

MTN TO RAISE R8 BILLION IN BONDS FOR ACQUISITION

MTN is planning to raise part of the $5,5bn it needs to take over the pan-African and Middle Eastern cellular operator Investcom by selling bonds worth up to R8bn. It started selling bonds to South African investors last week in a sale led by Deutsche Bank's South African arm, said finance director Rob Nisbet.

Four banks including Deutsche will lend MTN the cash it needs, but Nisbet did not name the other backers. MTN would borrow $3,85bn and issue up to 204-million shares to complete the payment, giving Investcom shareholders up to 13% of MTN.

Yields on the benchmark South African government 10-year bond have risen 24 basis points since June 7, the day before the central bank raised interest rates for the first time in almost four years. "It's an interesting choice of timing," said Leon Myburgh, a sub-Saharan Africa strategist at Citigroup. "You could have got substantially better rates last week."

Taking over Beirut-based Investcom will give MTN another 4,9-million customers in eight countries, along with licences to operate in two more. Last week MTN shareholders approved the reconstitution of its board to better support its international expansion, with moves to appoint experienced personnel able to help develop its business in the Middle East.

The new members include Sheikh ARH Sharbatly, a director of Riyad Bank in Saudi Arabia and the Saudi Arabian Refinery Company and chairman of Arabian International Corporation. CEO Phuthuma Nhleko said MTN needed a "regionalised operational structure" to realise its expansion plan.

(SOURCE: Business Day)

IN BRIEF:

- Telkom South Africa has cleared the second hurdle in its bid to take over Business Connexion, with 99,59% of shareholders voting in favour of its R2,4bn acquisition. Telkom bought its way to victory with the ordinary investors by offering R9 a share plus a dividend of 25c, for a share that analysts believe is worth less than R8. However its bid will face concerted opposition at the Competition Commission from the Internet Service Providers' Association (Ispa).

- A tender worth about R1.5 billion, to replace data and voice networks within the South African Revenue Service (SARS), which was to be awarded earlier this year, has been officially cancelled. The tender cancellation has fuelled suspicions that the entrance of Barry Hore, as acting CIO (replacing Ken Jarvis), has caused a reorganisation of all projects. There is also industry speculation that two other large tenders, currently in the evaluation phase, with a combined value of about R2.5 billion, will also be sent back to the drawing board.

JABBERAFRICA.ORG TO CLOSE DOWN

African instant messaging server JabberAfrica.org will be closing down at the end of June, three years after first opening the service.  Jabber is an open source instant messaging platform that can be used by a range of users including PC users and cellphone users.

Founder and sponsor Bruce Cohen says the financial burden of providing the free messaging platform is the primary reason for bringing the service to an end, leaving as many as 8,000 registered users looking for a new Jabber home. Over time, he says, traffic through the server has increased to around 3Gb a day, which has made the service increasingly expensive to fund.

Cohen says the JabberAfrica server has around 8,000 registered users with approximately a third of these active daily users.  Last week Cohen sent a message out on the JabberAfrica network to announce the impending closure:

“I’m sorry to advise that the jabberafrica server is closing down at the end of June. I realise this will inconvenience you and I apologise for it but I can no longer continue to fund this service. Bruce Cohen," he wrote in his short announcement.

Cohen says that since he sent out the message he has had a number of people contact him looking to assist in continuing the service and he says he will look into these opportunities to see if there is a way to keep the service running. If not, the servers will be shut down at the end of June.

Cohen says he became involved in the Jabber service in the hope that he would be able to build a community around Jabber. "Unfortunately there has not been the growth I had expected," he says. "We have catered to the consumer market with JabberAfrica and the demand has remained small."

Part of the problem, he says, is that once users have established themselves on other messaging platforms it is difficult to encourage them to switch to Jabber. "If your buddies are on Yahoo then you're a lot less likely to switch," he says.

Cohen says he still believes Jabber is an excellent agnostic, open source platform for multi-messaging that is very robust and can handle a range of communications, including VoIP, over the network.

(SOURCE: Tectonic)

NIGERIA DELIVERS SLIM PICKINGS FOR MULTICHOICE

Pay-television operator MultiChoice says subscriber growth in Africa's most populous market, Nigeria, has been slow, at only 100,000 subscribers, despite its 12-year flirtation with the country of more than 130-million people.

Caroline Creasy, head of corporate affairs at MultiChoice Africa, says although Nigeria is a difficult market to penetrate, MultiChoice believes there is room to grow its premium subscriber base. MultiChoice Africa and Adewunmi Ogunsanya Operations jointly own MultiChoice Nigeria. In 1991 Nigeria became the first country in sub-Saharan Africa to allow private multi-channel broadcasting, although television broadcasting in the country dates back to 1959.

According to a report from global telecoms and media markets researcher Informa Telecoms & Media, the Nigerian television market is the most competitive on the continent. Three digital satellite platforms were launched in 2004 -- FSTV, TrendTV and Trumpet Internet TV -- all competing with MultiChoice.

Creasy says although the current size of the pay-television market is not known, "MultiChoice believes there is still plenty of room for growth".

Other than digital broadcasters, there are more than 31 terrestrial broadcasters operated by the publicly run National Television Authority (NTA).

Informa Telecoms & Media says that of the 26,9-million households in Nigeria, 8,7-million are television viewers. In 1999, 70 NTA regional television stations were licensed. "Our growth has been slow and steady in Nigeria, as we are selling a premium product," Creasy says.

Another factor that hamstrings growth in the Nigerian market, Creasy says, is the time Nigerians spend in traffic jams, leaving very little time for television viewing.

Gryphon Asset Management portfolio manager Abri du Plessis says the premium status attached to pay-television has stunted growth. "I think the segment of the population in Nigeria that can really go for MultiChoice is a bit nervous and low on consumer confidence. They are unsure about the future in Nigeria."

The country is the continent's largest oil exporter and the US's fifth-largest supplier. Attacks on oil pipelines and kidnappings have cut oil production by more than 20%, adding to the upward pressure on world prices.

Creasy says programmes such as Big Brother Nigeria, increased local content and the participation of Nigerians on the local version of Survivor were attempts at building the group's market share. The Big Brother series was a major success story, she says. "Viewership of Big Brother Nigeria was spread across the whole of Africa."

MultiChoice Africa is banking its growth strategy on the country's film industry, dubbed Nollywood and rated the third-busiest movie sector in the world.

The pay-television operator has introduced the Africa Magic channel, an African general entertainment channel with more than 70% Nigerian content.

(SOURCE: Business Day)

PEOPLE

* Telecel Zimbabwe, the third largest cellular network in the country has confirmed  Rex Chibesa, as MD. Chibesa had been acting intermittently as MD for close to two years. His appointment brings to an end the company's search for a successor to former managing director Anthony Carter who left the company in 2004. Carter has since joined rivals Econet.

* At MTN,’s AGM held on 14/06/06, shareholders approved the reconstituted MTN group board of directors. The members of the board are: Cyril Ramaphosa (Chairman), Phuthuma Nhleko (Group president and CEO), Sifiso R Dabengwa (Group COO), Robert D Nisbet (Group CFO), Peter L Woicke, Dr Mamphela Ramphele, Ms Koosum Kalyan, Johnson MN Njeke, Sheikh Abdul RH Sharbatly, Jan HN Strydom, Alan F van Biljon, and Douglas DB Band.

* Newtec, a provider of satellite communication equipment and systems, announced the  appointment of  Martin Brasg as Business Development Manager for the African market. Before joining Newtec, Martin was business development manager with MarPless Communication Technologies of South Africa, a satellite integration company.

EVENTS

- HIGH SPEED ACCESS TECHNOLOGY CONFERENCE

20 - 22 June 2006, CSIR Convention Centre, Pretoria, South Africa