Issue no 264

top story

  • According to the widely leaked recent report from PKF Consulting on Kenya Telkom, it has 3052 watchmen, messengers and porters amongst its total payroll of 17,480. The Senegalese incumbent Sonatel, with the same number of fixed line customers as Telkom Kenya, had only 2,000 employees. PKF Consulting has recommended that 12,281 of these employees should be laid off. On this basis, Telkom would still have double the employees it needs. The cost of making 12,281 employees redundant? According to the consultants it will cost somewhere between USD74-232.5 million. With pension costs included the figure rises to between USD146.8-304 million.

    The Permanent Secretary of the Information and Communications Ministry said last week:"We wish this (staff redundancies) could be done as quickly as possible because the corporation's revenue is on a downward trend...Telkom has too many workers. This makes it unprofitable. After some time, it will collapse completely and everyone will go home." The Government has very few places where money on this scale can be found. One would be to sell its shares in Safaricom to Vodafone, a deal that has been under discussion for months but which the Government seems unable or unwilling to conclude.

    Telkom Kenya's last Managing Director John Waweru made clear at an early point after his appointment that large scale redundancies were essential but the current Government has seemed until this point to have lacked the will to take the difficult decisions needed to make it happen.

    Despite this unhappy history, its new Managing Director Sammy Kirui is an an upbeat mood, telling the world that "the company is about to explode (with new growth)". In an interview last week with News Update last week he praised the work already undertaken by his predecessor and identified the scale of the problems he will need to get to grips with.

    What were your first impressions of the company on joining?

    It’s not new to me. I had a lot of interest in it as the regulator and as it was also monopoly incumbent I looked at it very keenly. Its problems – like dissatisfaction with its services – were constantly being brought to our attention. So its problems are not new to me.

    How would you summarise its main problems?

    There are issues of staffing. Morale has been low because of the forthcoming staff rationalisation.

    There are network issues. We’re running a network that’s fairly old. The switches are from different manufacturers with different management systems. If there’s a fault, we don’t know exactly where the problem is. We want to be able to trouble-shoot effectively.

    We have customers at all levels who are very dissatisfied. There’s demands from users that we are not able to meet. This is either due to bureaucracy or the procurement systems.

    We have to look at our declining revenues and market share. We have to identify where there is revenue leakage. There are inefficiencies in the company. The company is not computerised or automated and this allows the potential for fraud.

    There are issues of vandalism which is quite rampant and costs us KS400m a year. Some of the lines vandalised are the fibre optic cables and when they go down, large numbers of people are without service. This is not just a Telkom Kenya issue but has a direct impact on the Kenyan economy.

    When will the staff rationalisation happen?

    The consultants report is just in and it now has to go to Government. We just need the go-ahead from Government. Then the question is: how will we fund it?

    The staff rationalisation has been talked about for several years but never seems to happen. Is there the political will?

    The Government has the will to do it. An inefficient Telkom Kenya impacts on the economy. You can’t go out and sell Kenya as a destination for overseas investment without an effective communications infrastructure.

    What about the company’s revenue leakage problems? Can you get to grips with them?

    We have a pretty good idea of what is going on and can therefore do something about it.

    How serious is the financial situation of the company?

    It’s breaking even but not making a profit.

    When will the privatisation happen?

    It depends on the Government. It has to decide. The company has inherited a number of legacy from when it was linked to the Post Office. Things like tax and pension liabilities have to be sorted out. We also need to invest in the network to create a company that has value.

    How long will it be before the Kenyan on the street will see improvements in service?

    As soon as the staff rationalisation is carried out. Once it is completed, we will have the money to invest in the network. Next week we will start building the Nairobi to Mombasa fibre link and it will be completed by December this year. We are currently testing our new VoIP service and it will either be launched this month or next month.

    We are proceeding with the ADSL launch. We are projecting that there will be 6000 subscribers. We are currently working on pricing issues. We have a good working relationship with the ISPs and will partner with them. We have not yet firmed up how this relationship will be structured.

    Our network will be 100% digital by the end of the year and we are about to extend our IN network platform for pre-paid calling cards.

    Will you have your own ISP?

    We are currently finalising the plans for our own ISP. But I have been very clear there will be no special preference for our own ISP. It has to survive or perish (as a business in its own right).

    What are your network expansion plans?

    We have to sort out our problems with the switches. We have to get them under one management system. When we achieve this, it will boost quality.

    We will address issues of broadband provision as part of the ADSL launch. We are also planning to do broadband wireless and are looking at a number of different solutions.

    In terms of fibre infrastructure, we are exploring where we can co-operate with Kenya Power and Lighting and seeing what synergies we can achieve.

    Have you got enough money to invest in the EASSy fibre project?

    We will be making a self-financed investment in the project.

    What’s Jambonet’s market share now that there is competition?

    It has retained a share of the market.

    Overall, the situation at Telkom Kenya is not as bad as it is portrayed in the newspapers. Potentially we have a very exciting company with growth potential.

    How will you address the issue of confidence in the company from your customers?

    We will have to work very hard to get the confidence of Kenyans. And the only way we can achieve that is to get network up-time 24/7. We have to invest in management systems. We have to invest in people through training them. We need to work towards being able to sign service level agreements. We have to automate our processes so that it does not take 6 months to get a line. People need to be able to have faith in our billing systems.

    There’s a paradox in terms of the staffing situation: Telkom is over-staffed but we are short of technical skills. We are over-staffed at the admin level. There’s also quite a lot of layers of management and we’ll be looking at that. We’re currently top-heavy.

    What will happen in terms of pricing?

    We are looking at some of our interconnect agreements. We’re currently seeking to renegotiate with Safaricom and in due course will do the same with Celtel. We’re trying to get the rates down. We’re also trying to deal with the grey market. The grey market affects my revenue because I have to pay the interconnect for calls I’m not getting revenue for. We should be able to drive international prices down.

    Will you be using CDMA more extensively?

    We will use it to invest in rural areas because it is cheaper to deploy than copper. It will also help where there is a lot of vandalism.


  • MTN, Africa‘s biggest mobile phone operator by sales, launched its third-generation network on Tuesday and said it hoped the service would snare half a million users within a year.

    South Africa-based MTN said it had spent 400 million to 500million rand ($60.2-$75.3 million) on the initial launch but might invest up to 1.5 billion rand within 12 months if it persuades 500,000 customers to sign up for the new high-speed service.

    "I think that is feasible within the next nine to 12months," Chief Technology and Information Officer Karel Pienaar told Reuters at a launch event. "The investment is subject to take-up."

    Third-generation technology, which allows users to surf the Web on their phones, download music and films and make video calls, has been slow to catch on in Europe and other developed markets due to costly handsets and technical glitches.

    MTN, which lagged its chief rival Vodacom by six months in the introduction of 3G, said it had chosen to wait until the technology and content was up to scratch and that it was not ata disadvantage. "If you had tried 3G earlier, you would probably have thrown it out," Ashraff Paruk, general manager of products and innovation for South Africa, told a news conference.

    "We are confident we now have the product ... To take broadband to the masses."

    Vodacom, majority owned by fixed-line phone firm Telkom and Vodafone, in December started selling the British giant‘s 3Gservices on its network, making it the first operator to offer the new technology in mainland Africa.

    MTN customers will be able to access 3G services in the main urban areas of Johannesburg, Pretoria, Cape Town, Durban and Port Elizabeth, which Pienaar said accounted for 40 percent of the population.

    The company hopes to extend the network to all towns within the next few years and to launch the service in Nigeria next year. Other African markets such as Uganda, Cameroon and Swaziland will probably follow.

    "Third generation can really make a difference in Africa because Internet penetration is so low," Pienaar said.

    MTN will charge the same for voice and data on 3G as for calls made on its standard GPRS network, which delivers data at slower speeds. It will offer free video calls for the first three months but after that will charge 2 rand a minute for contract customers and 3 rand a minute for pre-paid -- a slight premium on voice.

    Vodacom has offered video calls at the same price as voice calls to attract customers and grab a hefty share of the market before MTN arrived.

    MTN said its official target was to sign up 100,000 3Gcustomers within a year -- roughly in line with Vodacom‘s initial estimates -- but Pienaar said he hoped the company would chalk up at least 500,000.

    MTN already operates an EDGE network in main urban areas in South Africa, which is a stop-gap technology that delivers data faster than GPRS but does not carry video calls.

    The company plans to offer existing contract customers a free upgrade to 3G by supplying new SIM cards for their handsets, and top-end users will get a free 3G phone at their next upgrade.

    "We are trying to make it as easy as possible," said Pienaar, who noted that without subsidies, handsets cost around4,000 rand ($602.3).;


  • Nigeria, Africa’s biggest and most vibrant mobile market, is set to become even more lively with the announcement that two companies, Axcera and Africa Netcom, will make 3G services available there next month.

    Axcera is a manufacturer and integrator of broadband wireless access equipment and Netcom Africa Limited is a leading IP infrastructure provider of satellite and wireless broadband solutions across the continent.

    Starting in July, the two companies will begin to provide 3G services, first in Lagos and then in other major urban areas such as Port Harcourt, Kano and Nigeria’s new(ish) capital, Abuja.

    Coverage, based on an IP Wireless UMTS TD-CDMA system based on Axcera’s Axity 3G non-line-of sight (NLOS) broadband access platform will provide next generation mobile services to a potential subscriber base of more than 15 million, making it one of the biggest broadband wireless services in the whole of Africa.

    The new service, which is to be marketed under the brand name of “MyNetcom”, will be available either directly through Africa Netcom itself or through that company’s reseller network. It is centred on a “pocket-sized” modem for a PC that, the company says, “permits easy and simple user installation. A plug-and-play capability that eliminates expensive and time-consuming truck-rolls and keeps the cost down for subscribers.”

    Details of tariffs were not given, but Netcom said subscribers would have a choice of affordable, unlimited access monthly service plans. After completion of the nationwide Nigeria build out the company said it plans to broaden its reach into various other African countries.

  • Zanzibar-based ZANTEL and Vodacom Tanzania have entered into an agreement of co-operation whereby Zantel will provide national coverage on the Mainland using Vodacom's infrastructure. Under this co-operation agreement, the two companies will optimise the utilisation of their respective resources while being mindful of the environmental impact related to network rollout.

    ZANTEL said this was the fundamental reason for not duplicating existing network infrastructure. It said it was delighted with the agreement which affords it the opportunity to kick-start its launch on the mainland.Vodacom gave us the strong backbone of support we needed, said ZANTEL's CEO, Muhamed Salim.

    By simply using the Vodacom network, ZANTEL users will immediately be able to use their SIM cards on the mainland with ZANTEL products and tariffs.ZANTEL pre-paid starter packs will be widely available for new customers, Salim said.

    ZANTEL is owned by a mix of shareholders including government of Zanzibar (18%), Emirate Telecommunication Corporation (34%), Kintbury Investment of Channel Islands (24%) and MEECO International of Tanzania (24%).


  • The Ethiopian Telecommunications Corporation (ETC) has selected six local companies in its first outsource effort to sell prepaid mobile SIM cards. The selected companies, Dire Industries, Aron Computers Plc, Glorious Plc, Garad Plc, Admas Tel Plc and Daruga Plc, have entered into negotiations with the Corporation about the commission they will be offered.

    More than 100 companies and individuals were bidding to get this seemingly lucrative business since March 2005. The Corporation's board decided in the same month that ETC should focus on building the network infrastructure rather than busying itself with a retail market.

    The mobile telephony service was first introduced in 1999 with a subscription base of 36,000 post-paid. This number has now reached half a million subscribers, while 50,000 are on a waiting list, according to officials of the Corporation. ETC also anticipates finalizing network expansion in the coming six months that will enable it to entertain 650,000 more subscribers.

    The SIM cards for these services will no longer be distributed through ETC's various branches. The six selected companies will offer them to the public through their outlets.

    Dire Industries has 12 such outlets in Addis and another 10 in the regions. Its Deputy Manager, Elias Bedada, told Fortune that one of its shoe stores located in Piazza will be totally converted into a SIM card distribution centre. The Company, also an official distributor of Sunny Electronics, has three buildings in Addis and leather and sole factories.

    Glorious is an exclusive agent of Japanese Sony products in Ethiopia, while Garad imports South Korean Samsung electronics. It has two rented buildings. Aron Computers imports PCs and their accessories, while Admas Tel distributes telephone apparatuses. It is a company established by former employees of ETC itself who left it when they retired.

    Although ETC officials declined to disclose the amount of commissions these companies had offered, other sources disclosed to Fortune that they range between 2.8pc and 20pc. The Corporation sells a SIM card for 443.10 Br.

    Many disqualified bidders were disappointed with the selection. They had expected the Corporation to pick at least two vendors for an area of a considerable size.

    "I have no idea why we were left out," said Muluembet Abebe, general manager of Brass Maternal and Child Hospital, located around Bole, by the ring road.

    She and two other bidders had offered five per cent in commission and distribution facilities outside of the capital. The disqualified bidders are now seeking the return of the 100,000 Br they deposited as a bid bond.

    Abdurahim Ahmed, general manager of Communications Affairs Main Division at the ETC, told Fortune the Corporation will supply the market with SIM cards through the companies within a month.

  • The Nigerian state government of Jigawa has begun trials of a GSM-based local mobile network in the region. The state is currently testing 1,000 lines, most of which are being used by government officials, to ascertain the reliability and quality of the network. The government hopes to launch the service with a capacity of around 20,000 lines in the state capital of Duste, however, it has yet to secure interconnection agreement with incumbent fixed line operator NITEL.

  • New Clicks Holdings is one of South Africa’s premier retail groups, with more than 900 stores operating under brands including Clicks and Discom. The group focuses on health, beauty and lifestyle products and services.

    One popular product line is prepaid airtime for mobile phones: 64% of all South Africa’s cellphone users, and 78% in the 20-24 age bracket, manage their cellphone budgets this way. Prepaid airtime has traditionally been sold in the form of plastic scratch cards, but these have a number of disadvantages. Not only are they vulnerable to theft, it can be difficult and expensive to ensure a regular, adequate supply, particularly in more remote parts of the country. In response retailers have increasingly opted for selling “virtual airtime” in the form of coded vouchers printed at the point of sale.

    New Clicks made the decision to sell virtual airtime rather than plastic scratch cards in its Clicks and Discom stores to minimise administrative requirements at till points, as well as to combat high levels of shrinkage. In most of its stores airtime sales were able to piggyback on existing communications infrastructure; in just over 90 stores, however, there was no existing telephone or infrastructure – and no option of installing a radio-based solution because of lack of coverage.

    CellPAD’s low cost and outstanding coverage made it a natural choice for New Clicks. “The GSM networks gives us about 97% coverage of the entire country,” notes consultant Roger White, who assisted New Clicks with the project. “Nothing else comes close.”

    Each of the 90 stores now has a CellPAD device operating, linked into store networks so that every till point has access. “We rolled out to all 90 stores in a month,” says White. “The rollout was surprisingly easy, you just stick it in and go. We had problems with weak signal strength in nine stores, but those were resolved by putting in stronger antennas.”

    “It’s a good, working solution,” says White. “The CellPAD will definitely replace other wireless options, it offers superb coverage at relatively low cost. Datalinx were in the vanguard in South Africa and they deservedly lead the market.”

    Thanks to the CellPAD solution for prepaid airtime, says George Lilley of Clicks, “we’ve eliminated the shrinkage problem entirely. There’s also a major benefit to our customers in that we can’t ever run short of stock, which was sometimes a problem in the more remote stores. So we’ve been able to offer better service to our customers and lower our own costs at the same time.”

  • Malawian regulator MACRA has said that it will give a wide legalisation of VoIP services. This was meant to happen in July but has been delayed as the enabling legislation has not yet been passed. Local ISPs are gearing up to offer international calls to Europe and the USA for 35 cents a minute.

    Meanwhile the Mauritian investor behind the proposed third mobile operator is in trouble. He was fined for not starting the company's roll-out. On visiting the country six weeks ago he was arrested for not paying the fine. He maintains that he has a receipt for payment from MACRA. The matter is now in the courts.

  • - Both Kenyan mobile operators Celtel and Safaricom are building building their own teleport which will put yet another dent in Kenya Telkom's revenues.

    - South African cell phone operator MTN appears to have lost yet another bid war in the Middle East. It has not been invited to participate in running Iran's second mobile phone licence, the company said on Wednesday. "MTN has not been invited by the Iranian authorities to participate in the second licence opportunity," the company said in a statement. MTN Chief Technology Officer Karel Pienaar said on Tuesday the company was "very bullish" about its chances in Iran and that was in talks with the government. It was unclear on Wednesday whether MTN had lost out on the deal, or whether Iranian authorities had not yet made their decision. A company spokeswoman declined to clarify.

    - The UAE’s state-run telecoms operator Emirates Telecommunications Corp (Etisalat) is looking to expand its presence in East and West Africa, and considering acquiring operations in Libya, Yemen and Bangladesh. According to Obaid bin Mes’har, head of international operations, Etisalat is seeking to expand in Africa and the Middle East, where the markets are growing fast and record earnings derived from oil have helped fund the UAE government’s ability to dramatically outbid rivals, such as MTN Group of South Africa, for phone licences in the region.

    - The Ethiopian government has blocked the sending of SMS messages on Ethiopia's mobile network. Subscribers can still receive (from outside Ethiopia) but cannot send. The reason given for this is that the opposition party and others were using SMS to incite demonstrations and riots a couple of weeks ago when the government announced the delay in finalising the election results. The SMS ban will continue until after the planned July 8th announcement of those results.

    - Rwandan mobile operator MTN Rwandacell has reported that its subscriber base reached 175,000 this month, up from just 15,000 five years ago. According to CEO Per Ericksson the company’s success is due to investments in improving service quality and customer relationships.

  • * Ghana Telecom has expanded its fixed line network in the Upper East Region of Ghana, upping capacity and replacing outdated equipment in the area. The incumbent has also expanded its mobile network, which operates under the One Touch brand, to the Bawku and Navrongo regions. The work is part of the state’s plan to expand GT’s network to around 400,000 fixed and 750,000 mobile lines by 2007.

    * Celtel International has signed a contract with Ericsson of Sweden for the supply and delivery of equipment to enhance coverage and capacity on its network in Tanzania, including the provision of GPRS technology. Under the deal, Ericsson will deploy its Mobile Soft-Switch solution, which can carry high volumes of voice and data over a cost-optimised network architecture.

    * Uganda Telecom (UTL) has reported that its rollout of new fixed line brand Telesaver Plus has reached 39 districts across the country, with 15,000 lines being sold so far. UTL has partnered with Centenary Rural Development Bank to offer loans to make the residential service accessible to as many people as possible.


  • Eutelsat announced the signature of a contract with Algérie Télécom, Algeria's incumbent operator, to support a far-reaching satellite broadband programme that will serve public administrations and enterprises throughout the country, from the Mediterranean coastline to remote locations in the Sahara desert.

    Following an international tender, Algérie Télécom has selected to lease capacity on Eutelsat's ATLANTIC BIRD™ 3 satellite whose Ku-band steerable beam has been optimised for North African countries including Saharan regions. In addition to satellite capacity, Eutelsat is supplying engineering support in the initial phase of operations.

    Algérie Télécom will provide broadband services through Eutelsat's ATLANTIC BIRD™ 3 satellite and a new DVB -RCS platform, which the company has located at its teleport near Algiers. Delivered and installed by EMS Technologies, the platform is based on the DVB-RCS international open standard for satellite two-way broadband communications. Algérie Télécom will be able to serve up to 2,500 users equipped with 1.2 metre antennas and two-way broadband terminals via a 36MHz bandwidth transponder on ATLANTIC BIRD™ 3 for the forward link and 18 MHz of bandwidth for the return link. Eutelsat will be able to provide additional resource in the same coverage as demand for broadband ramps up.

    The range of applications which the platform will support include Internet access, Virtual Private Networks, data transfer, video-conferencing and Voice over IP. This will equip Algérie Télécom for serving broadband requirements from enterprises operating in the oil, gas and mining sectors, as well as public administrations, hospitals, schools, customs and immigration control etc.

  • The Angolan Government is investing about USD 200 million in the installation of a new telecommunication system that will facilitate the access to Internet and other telecommunication services across the country.

    The information was released by the director of the Angolan Institute of Telecommunication (INACOM), João Beirão, who said the project started to be implemented two years ago, with land connection between Lubango and Namibe (southern region) being currently near completion.

    He said a cable will also be installed in the locality of Santa Clara, southern Cunene province, to enable an interconnection with the neighbouring countries. João Beirão explained that the system will also interconnect the villages and districts situated between Lubango and other provinces.

    According to him, the project intends to set up infrastructures that enable people to communicate with quality and an adequate expansion of Internet.

    Currently, the country is almost completely interconnected through satellite. Communication between provinces has to be done via Luanda.

  • Ghanaian ISP NCS has just launched its own version of Skype called Clicktel ( to its own customers. It offers free PC to PC telephone commmunication and global PSTN calling.

    As with Skype, PC to PC calls are free but you have to pay for calls to numbers operated by telcos. All you need is: a PC with a sound card, an internet connection (preferably broadband), PC Phone software (downloadable at and a computer headphone or headset with microphone. It offers similar low rates to Skype for calls to PSTN numbers and there is a rates page on its site. There is a minimum payment of USD10. It promises a password for customers "via email in less than 48hrs".

  • The City of Johannesburg’s Economic Development Unit in conjunction with BMI TechKnowledge Group held a series of workshops last week to discuss a broadband strategy for Johannesburg.

    Role players from all interested fields including MyADSL, Johannesburg Area Wireless Users Group (JAWUG), Telkom, the SNO, Vodacom, various ISP’s and others were invited to provide input regarding the development of Johannesburg as a broadband enabled “Smart City’.

    Johannesburg is a hub of economic activity in South Africa with 74% of all corporate head offices, 59% of I.T. enterprises and a large majority of accounting; legal and media firms based in the City. The City of Joburg’s contribution to the national economy is almost 16%.

    The City’s Economic Development Unit has had the great foresight to acknowledge the need for a comprehensive and sustainable broadband initiative for Joburg in order to further stimulate economic growth.

    Whilst this project is still in the discussion phase the aim of these workshops was to pool together ideas and views in order to develop a sustainable broadband initiative for the City of Johannesburg to implement before 2010 and to continue towards their 2030 Vision.

    Roelf Diedericks, a representative from JAWUG, raised concerns regarding legislation and regulations on WiFi. He addressed many valuable issues turning the spotlight on developing a competitive internet access environment.

    An interesting development on the international front is the proposed legislation by two U.S. senators to prevent states from outlawing city-run broadband services.

    The Community Broadband Act of 2005, introduced by Senators John McCain, an Arizonian Republican, and Frank Lautenberg, a New jersey Democrat, aims to prevent states from outlawing municipal broadband services while requiring the cities to regulate their own services the same as they regulate competitors.

    Private investment in the Internet should be protected but McCain added that, “When private industry does not answer the call because of market failures or other obstacles, it is appropriate and even commendable, for the people acting through their local governments to improve their lives by investing in their own future.”

    The City of Joburg faces similar challenges balancing private investment with optimal economic growth of the City.

    From the workshops it becomes evident that the way forward is by no means a smooth and easy ride but the drive and focus of the City of Johannesburg to develop an economically sustainable broadband initiative is encouraging.


  • Shopping over the internet will become more secure when magnetic stripe credit and debit cards are replaced by more secure chip cards. At the moment, consumers can be swindled if a thief has obtained their credit card information and uses the account details to make purchases online or over a cellphone. Once smart cards are introduced, consumers will be able to generate a unique secret number to use.

    Consumers will need to be issued with a small card-reading device, says Walter Volker, the GM of payment systems for the Absa group.

    The user will enter their personal identification number (Pin) into the reader, which will generate a random number called a cryptogram.

    The customer will read that number over the telephone, computer or cellphone to confirm they are the genuine owners, Volker said.

    The system is known as a Card Authentication Programme, and is a technology that Absa is planning to roll out soon, he said.

    The conversion to smart cards will cost about R1bn in SA alone, but it is essential because the current magnetic stripe card technology is 30 years old.

    Visa's GM for sub-Saharan Africa, Rob Clark, said UK banks had been quick to adopt the new technology because fraud was rising steadily.

    When plastic card fraud hit £411m in a year consumers formed a lobby group and began digging out their old cheque books, he said.

    The Smart cards comply with international standards set by Europay, MasterCard and Visa.

    Business Day

  • Cactel Communications (formerly Intell Solutions) has carried out what is probably the first test of powerline transmission in Africa outside of South Africa. Tshwane Municipality (which covers Pretoria) has also conducted tests with a view to developing a municipal network.

    Last week, a series of demonstrations of powerline communications took place on the premises of Graphic Corporation, Accra, Ghana. Attendees included the Electricity Company of Ghana, Ghana Telecom, Africa Online, Internet Ghana, University of Ghana and the UNDP. Cactel was assisted in this demonstration by its technology partners, the Spanish companies DS2, the silicon chip designer that powers the PLC modems, headends and repeaters, and the systems integrator Tecnocom. Meetings during the week included the Ministry of Communications, the Office of the President, and the National Communications Authority.

  • An all-out war is raging in the music industry over the sale and distribution of Kenyan music and videos in the Internet.

    Some unscrupulous Kenyans, mainly in the US and the UK, have set up websites where they are selling music and videos by Kenyan musicians without their consent, let alone rights.

    Most of the musicians contacted were not aware that their work was being sold abroad and reacted with shock and outrage. Some of the websites also contain juicy stories about Kenya in general and musicians' profiles, some which are plagiarised from the Kenyan media.

    "They are thugs," exclaimed contemporary gospel artiste Rufftone (Roy Smith Mwatia) on learning that a website based in the UK was offering the video for the song Mwikulu. The site also features mini clips of musicians Nonini, Pilipili, Flexx and Deux Vultures, among others.

    Ordinarily, musicians are supposed to have a contract with those marketing their music and agree on a certain cut from the proceeds. But it appears that the website owners just buy a single copy of the popular CDs, which they then duplicate and sell at international rates on the Internet.

    "It's very hard to trace these people because they operate from outside the country," said Tony Komo the co-founder of, the only recognised Kenyan music Internet marketing site with sole rights to the products of Harry Kimani, Esther Wahome, Nonini and Jua Cali.

    Kilimanjaro is offering Afro-Jazz musician Achieng Abura's latest CD Spirit of A Warrior at $12.99 (about Sh1,015) apiece. "As Kilimanjaro Entertainment, we are proud to be one of the few sources of Kenyan music in North America," wrote George Ndege in an e-mail to Review. "And, every CD we have on our website is legally obtained and paid for."

    But contacted for confirmation, singer Abura expressed surprised that her CD was on sale on the Kilimanjaro Entertainment website.

    "We obtain our music through the producers or from the artists themselves," said Ndege. In Spirit of a Warrior's case, he wrote, "we bought a copy from producer Tedd Josiah."

    But Josiah, the man behind Blu Zebra Records, was reluctant to comment, only saying that he didn't wish to make his issues with Kilimanjaro public.

    Kilimanjaro is also selling a 15-track album, Best of Genge Vol1, a compilation of the best genge hits. Seven of these tracks are by Nonini (Waliotuacha, Keroro, Hunipati, Moyoni and others) while the rest are by Jua Cali (Kamata Dame, Vile Ntafanya, Kulikuwaje and Nipe Asali), Circute and Joel (Hot Dog and Manyake) and Genge by Rat-a-tat. All these numbers are from Calif Records' stable.

    Interestingly, Calif Records has never produced such an album. "We heard about it from a friend in the US who mailed it to us," said Charles Abungu ('Tall') who markets and partly manages these genge musicians.

    Ndege stressed that Kilimanjaro bought the music from producer Clement Rapudo (Clemo) of Calif Records, a view hotly disputed by Tall. "That's pure piracy. What they bought was for personal use and they have no right to duplicate them."

    The site also sells K-South's Nairobizm (which Ndege says they got through producer Bruce Odhiambo) and CDs by Redsan, Mercy Myra and and Ray C. He says they bought Redsan's and Ray C's CDs directly from them (the latter when she toured the US last year), while Mercy Myra's was sourced "from Giddo Kibukosya through Bruce Odhiambo".

    "We not only sell CDs legitimately, but have also helped several Kenyan artistes come to perform in the United States," claimed Ndege. "At Kilimanjaro Entertainment, our mission is to promote Kenyan and other East African artistes in North America and we are proud of it." is the only legitimate website where you can buy music from selected artistes. Registered in Kenya and the US as Kenyanese Kenya Limited and Kenyanese Incorporated respectively, it was founded early this year by youthful entrepreneurs Tony Komo and Tim Waindi.

    Komo says that the "rogue sites" are cashing in on the high demand for locally produced tracks by Kenyans abroad. "You cannot believe how patriotic Kenyans are when they're abroad. They appreciate everything from home. Our call to them now is not to allow themselves to be used to exploit musicians."

    Though most of the CDs on sale at the rogue sites are pirated copies, they go for the price of an original - slightly over the equivalent of Sh1,000. The price is mostly quoted in dollars and one can make a purchase using a credit card.

    To illustrate the power of e-marketing - which largely relies on one-to-one publicity, singer Achieng Abura says that since her profile and photo were posted on the Kenyanese website, she has got inquiries for her music from people as far as Paris. "This is an interesting option we have to explore."

    Kenyanese also intends to make Kenyan music available in stores in the US, "alongside the likes of 50 Cent and other big names." Last January, Komo says, they made an initial delivery of 500 CDs of Harry Kimani's debut album, Unborn, and Nonini's Hayaring Game, which were quickly sold out.

    The issue of copyright has been a contentious one. And it's getting louder as the industry grows. Some argue that even the ubiquitous FM radio stations should pay musicians for playing their tracks. However, this reasoning is beaten by the fact that most musicians are a creation of radio stations.

    Kenyan music's affair with the net has a long, jumbled history. The first Kenyan group to put music on the net was Five Alive. It was put on by the Media Street Website as part of the site's cultural content. The posted contents included a 30-second sample of their eponymous album Five Alive. was more for promotion of distributors and record companies than musicians. It had samples of music for audition purposes and expectations were that it would evolve into a music e-shop. That was in 1995, an age when computers and the Internet were for a privileged few in Kenya. The highlights of music marketing on the web then was that year's Guinness Sunbeat Reggae Festival, when promoters made ticket sales via the Internet.

    Currently, at any chain of Uchumi supermarkets, there is a counter. Mymusic is a software for downloading any song of your choice from a music bank of over 400 Kenyan songs. One can burn a ten-track CD for Sh75 per song, or one dollar in the case of those buying from abroad. This service helps in curbing music piracy, since a CD ends up fetching nearly the same amount as it would from a music shop.

    The Nation

  • - Mweb is looking at going into three other African countries (including Cameroon) once it is happy with progress in Nigeria.

    - Reports reach of us from several directions of unhappiness with the performance of UTL’s CDMA-based internet service.

    - The National Institute of Telecommunications, within the ambit of the new telephonic numbering, created a new direct connection system of internet providers to Angola Telecom that will enable to reduce the costs of these services, the institution director Joao Beirao said on Wednesday. Mr Beirão explained that with the new system internet users will be directly connected to the service provider, which means a cheaper access to internet.

    He added that internet users, for having a computer connected to a telephonic line, have to pay two bills - one to Angola Telecom for the usage of the telephone and another one to the provider, but with the new system it will not be necessary.

    - The Provincial Department of Justice of Angola's central Bié province got connected to internet early in June this year in order to facilitate the issuing of Identity Cards in the region and communication with the rest of the country and the world. According to the institution's acting delegate, José dos Santos, the signal was inaugurated by the Justice minister, Manuel Aragão, during his visit to that southern province. José dos Santos said that only two computers are connected to internet, which will secure the connection with others.


  • The recent ICTe-Africa event in Nairobi bombed out completely. Visitors and delegates reported extremely low numbers with often fewer than 30 people present outside of speakers and exhibitors. The event was three times delayed in order to accommodate the Kenyan Minister who was due to make the opening speech. In the event the Minister ended up sending his Permanent Secretary to do the honours.

    As if all that were not bad enough, the Conference security staff held TESPOK Chair, Wananchi's Joseph Mucheru for having what they claimed was a counterfeit name badge. Despite the low numbers, there were apparently a number of people trying to get in without registering. Other delegates report that it took up to half an hour to register and get a name badge. One of the exhibitors went on local television and complained that there were not enough visitors to the exhibition.

    Nokia reportedly walked out as an exhibitor. It had been promised GSM exhibitors from all over the sub-region but found itself largely being approached by people wanting to buy mobile phones. What makes all of this mayhem difficult to understand is that the company selling the event was charging very high rates for participation and should have been able to deliver a better event.

  • As part of a long-term strategy for improved public expenditure management to drive its macro-economic environment and reduce poverty, the Government of Uganda’s Ministry of Finance, Planning and Economic Development (MoFPED) and Hewlett-Packard (HP) have announced the successful completion of the 1st Phase (Pilot Project) for its Integrated Financial Management System (IFMS).

    Implemented by HP and its partners, the IFMS is currently running at six government ministries and four local government bodies including the Kampala City Council and Jinja, Bushenyi and Lira.

    The aim of the system, which uses Oracle applications software, is to support the improvement of public sector budgeting, financial management and accounting to achieve more timely, transparent and accurate information for both the local and central government of Uganda. The project, which commenced in February 2003, has been heralded as one of the most sophisticated and most rapid implementations of its kind on the African continent to date.

    According to HON. Professor Semakula Kiwanuka, Minister of State at MoFPED and responsible for Investment, before embarking on the ambitious project, the Government of Uganda - in consultation with the World Bank - did extensive planning and research on the political mandate and organisational structure required to ensure the success of the project.

    “After issuing a Request for Proposal, we reviewed the various responses from major international companies and went into protracted negotiations with the bidders – carefully evaluating their track record of successes in similar environments,” says the Minister.

    HP was selected for a number of reasons, most notably for the company having implemented similar solutions worldwide, its long-term commitment to the region and its pledge to take responsibility of all aspects of the project. This involved the implementation of the applications and setting up of the infrastructure at the main data centre in Kampala as well as all the other sites across the country. Other key components included the setup of the wide area network, training and capacity building, and change management.

    Olivier Suinat, managing director for Africa at HP says: “Because the solution had to offer around-the-clock global availability and the capacity to accommodate multiple functions simultaneously, numerous critical factors had to be considered in the design. These spanned the mission-criticality of the application and database, the ability and availability of professional technical consultants to maintain the system, the training and transfer of skills to GoU personnel and the delivery of a total solution and services offering.”

    HP and its project partners have delivered a solution that integrates new technologies with an existing heterogeneous system which allows disparate departments and systems to share information seamlessly. Sub-contractors to HP on the project included Oracle Corporation for Treasury application services, Computech Uganda for hardware infrastructure services, Venture Communications Uganda for networking infrastructure services, RPC Data Uganda for application functional training and support and UTL Uganda and MTN Uganda for telecommunication services.

    The IFMS application features an inter-related set of sub-systems which plan, process and report on financial resources and cover a broad spectrum of financial management areas. It is built around a common, single database which records all financial data flows and is shared by all users.

    Desi Lopez Fafié, managing director of Oracle’s African Operations, says: “The Treasury application was designed to enhance the efficiency and accountability of all financial applications. By having a consolidated view of the organisation, MoFPED will be able to establish its current financial position in a shorter time, which will enable officials to make informed and timely decisions at reduced cost.”

    Minister Semakula Kiwanuka says that many benefits are being derived from the IFMS implementation; the most important being the increased ability to undertake central control and monitoring of expenditures and receipts within the Ministries and local government.

    “In addition, it allows for increased access to information on financial and operational performance, internal control to prevent and detect potential and actual fraud, access to information on the Government’s cash position and economic performance, understanding of actual costs of groups of activities and tasks, and the ability to demonstrate accountability to donors and to the people of Uganda. We are now looking forward to the ‘rollout’ phase which will include implementing IFMS at a further 21 public sector sites and the setting up of a disaster recovery centre in Kampala. This will ensure efficiency, accountability and transparency in all the Government sector’s dealings and services,” he says.

    Suinat concludes: “HP is proud to be associated with the Government of Uganda and the World Bank in successfully implementing this pilot phase of the IFMS project. The success was undoubtedly due to the teamwork displayed by the operational teams on both sides, and most importantly, the management commitment across all levels within Government and from the project contractors. It is great to see such successful capacity building for Government services in Uganda, in line with NEPAD’s objectives and the much-discussed recommendations from the G8 Commission for Africa report.”

  • Liquid Thought, one of a clutch of successful young IT companies to emerge from Cape Town in the past few years, has opened an office in London to source new business for its home operation.

    The move comes as Cape Town is positioning itself in global markets as a prime destination for outsourced ICT and business processing work, thanks to its mixture of strong skills at globally competitive prices, first-world infrastructure and attractive lifestyle.

    Liquid Evolution, the company’s new media design division, is offering reduced cost and rapid delivery to UK-based companies willing to outsource work to South Africa. The company’s portfolio includes design projects for major South African banks and retail houses as well as Vodacom, the local Vodafone operation.

    “Cape Town is an ideal outsource destination for UK companies,” says Liquid Thought founder Zulfiq Isaacs. “We have the cream of Africa’s design talent, many of whom have worked overseas and know the UK market and its demands. We also have a great work ethic, we share a cultural base and similar time zones and our exchange rate is favourable.”

    Isaacs says the opening up of the South African telecommunications market has helped to motivate the company’s move offshore: “Our telecommunications costs are coming down, at the same time as new technologies are emerging to enable us to make the most of relatively limited bandwidth to Africa. Our Cape Town team can speak to clients in London via instant messaging, voice over IP or video conference; combined with our on-the-ground presence, it’s as good as being there.”

  • The NEPAD e-Africa Commission has signed a memorandum of understanding (MOU) with Hewlett-Packard (HP), thereby formalizing Uganda’s participation in the NEPAD e-Schools Demonstration Project. The occasion took place on Friday at HP offices in Sandton.

    Dr Henry Chasia, Executive Deputy Chairperson of NEPAD e-Africa Commission signed on behalf of his organization, while Mr Andre Hartley of HP, General Manager for HP Sub-Saharan Africa. Soul Kaye, Uganda NEPAD liaison person signed on behalf of the Ugandan Government. Uganda is the first country on the entire continent to be the beneficiary of the NEPAD e-Schools initiative.

    The signing of this MOU followed a 3-day NEPAD e-Schools Demo launch preparatory workshop, which had been going on since 29 June till 1 July 2005.

    The workshop delegation included CLPs from 16 African countries, and officials from NEPAD, S. Africa Department of Communications and Society Partnership for Africa’s Development (ISPAD). The countries that were present include Algeria, Burkina Faso, Cameroon, Egypt, Gabon, Ghana, Kenya, Lesotho, Mali, Mauritius, Mozambique, Nigeria, Rwanda, and Senegal, South Africa, and Uganda.

    The workshop participants discussed a detailed launch strategy of the initiative in each country, and other issues related to ISPAD. The workshop also used this as an opportunity to discuss the challenges, suggestions and solutions that CLPs might have regarding the implementation of the Demo.

    It is expected that the workshop would come up with a comprehensive rollout of the NEPAD e-Schools activities, responsibilities of the CLPs, and a monitoring and evaluation strategy for the project.

    The NEPAD e-Schools Initiative is one of the priority projects of the NEPAD e-Africa Commission. The initiative aims to equip African schools with appropriate Information and Communication Technologies (ICT), to enable them participate in the information society and bring the continent closer to meeting the Millennium Development Goals.

    During the first phase, the NEPAD e-Africa Commission will implement the NEPAD e-Schools Demo. The Demo is intended to accrue a body of knowledge, based on real-life experiences of implementing ICTs in schools across the African continent that will serve to inform the rollout of the NEPAD e-Schools Initiative. To this end, the Demo will establish and monitor six secondary e-schools in each of the participating “phase one” countries.

    It is expected that the first NEPAD e-schools launch will be in Uganda, mid July 2005.

  • Microsoft Nigeria has counseled banks in the country to focus on exploring Windows Server System solutions that could make their business operations easier, cheaper and more secured.

    According to the Enterprise Account Manager for West, East and Central Africa at Microsoft, Mr. Adefolu Majekodunmi, interactions the firm had in recent times have shown that they are facing a number of serious challenges.

    Speaking at a session on IT consolidation banking best practices in Lagos, recently, he noted this includes the cost of available solutions that are costly yet unsecured.

    This, Mr. Majekodunmi said is also centred on the ability to manage the IT center network and computer infrastructure which supports their businesses.

    One of the key drivers, he said, was what Microsoft termed 'do more with less,' which means consolidating the number of servers - large computers that store most of a company's data thus integrating different sets of software into a single solution.

    As a result, "there are two key focus areas namely operational efficiency and productivity," he declared.

    Stressing that IT departments have a mandate to improve efficiency and add more value to the business by simplifying technology systems and empowering users to do more with that technology.

    "They are expected to deliver more benefits, support more users and deploy and support more solutions with fewer resources and a lower budget. This is a serious challenge," said Majekodunmi.

    He maintained that it is possible to reduce technology costs, simplify the management of that technology, centralise security and achieve high service levels.

    This, he also, said allows IT professionals to see how they could create a secure and reliable email system that cuts costs and makes business life easier.

  • - Qatar's Minister of Finance H E Yousuf Hussein Kamal, who is also deputy chairman of the IT and communications supreme council, arrived in the Tunisian capital to chair Qatar's delegation to the 17th meeting of the executive Bureau of Arab IT and communications ministers that took place on Thursday. At their respective meetings, Arab IT and communications experts and ministers have been preparing the grounds for the second phase of the global IT community summit due to be held in Tunis in the first half of next November. The meetings also explored the prospects of setting up an Arab organization for information technology and communications and would work out an Arab strategy for an effective integration into today's world of it revolution.

Digital Content

  • SMS Banking may not be making the headlines but it is certainly growing and fast too as one of Nigeria’s pioneer of Internet banking First Atlantic Bank has found out.

    The bank now has about 270, 000 SMS bank account holders since it first launched the service four years ago.

    Its flagship SMS banking service ‘Flash me cash’ has grown in popularity though there is still plenty of room to get more people using it from the over 10 million mobile phone subscribers said Group Head of Technology Deji Oguntonade and Head of Electronic Product Marketing Group (EPMG) Ure Okezie.

    Besides the 270, 000 SMS bank account owners, only 10% or 27, 000 are considered active. But the volume of transaction is on the double positive side. SMS banking transaction averages about N600 million a month, which highlights the level of confidence those who click on their phones to do banking transactions have in their platform.

    When First Atlantic first introduced SMS banking, less than 40 phone users were willing to use their phones to make financial transactions on any day. Over time, the acceptance level rose to a record 300 per day. Last year, it increased to 1000 users per day and this year, an average of 3000 people click their mobile phones to do banking business according to Oguntoinade and Okezie.

    “We have seen a huge transaction in value and volume of what we have done and people are more comfortable with the product. We now have ‘Flash me cash’ club like a marketing network that helps spread out the news on the merits of the product,” said Oguntonade.

    First Atlantic Bank, which is teaming up with other banks to form the new Astra Bank under the Central Bank of Nigeria's regulation that banks increase that liquidity base to N25 billion (about $250), said its Internet banking has offered more exciting results.

  • Kiboga district will go online following a $56m (sh98b) World Bank grant for creation of websites, Paddy Galabuzi, the district planner, has said.

    Galabuzi said this recently during the launch of the district website, at the council hall.

    "The World Bank recently gave Kiboga a grant of $56m to develop a website to increase accessibility of information about investment opportunities," he said.

    Galabuzi said the programme would cover all the sub-counties. He said the move would accelerate development.

    Galabuzi said prospective investors would get a clear view of the available opportunities.

    The district vice-chairman, John Kalungu, said the website would help them access free worldwide information and market products to improve standards of living.

    Kalungu said, "The launch of the website will increase the district's value."

  • - Tupperware Southern Africa has concluded an agreement with CreditPipe and service partner MTN to use MobileCredit, a service that enables credit card payments to be processed securely via a cellphone. A pilot project kicked off and was concluded in September 2003 in which seven of Tupperware's 28 distributors were involved, which had salespeople subscribe to CreditPipe's MobileCredit service through MTN. To process a payment, Tupperware salespeople enter the necessary credit card and transaction details into the cellphone, which is transmitted to the bank via an encrypted SMS for verification and processing. Once the transaction is logged, a response is transmitted back to their cellphone indicating whether it is approved or declined. Tupperware's distributors have multiple cellphones linked to a single merchant account, allowing entire teams to transact. The distributors can manage the facility online with Credit-admin, a website that tracks and manages all transactions. Tupperware is in the process of launching the service to its sales force of more than 34 000 people in South Africa, Swaziland, Mauritius, Zimbabwe and Botswana.

Mergers, Acquisitions and Financial Results

  • Safaricom made a Sh8.4 billion profit before tax for the year ending March 31, compared with Sh5.13 billion the previous year.

    The growth was 64.62 per cent against that for the year ending March 31, 2004. It was made on the back of a 64-per cent increase in subscription, which has hit over 2.5 million. The company's turnover went up by 42.7 per cent to reach 26.9 billion from Sh18.86 billion in the previous year.

    The percentage increase in turnover was less than the increase in subscribers, largely due to the fact that new subscribers always tend to spend less than existing ones.

    The revenue was mainly generated from sale of airtime services, while revenue from selling handsets declined to Sh540 million from Sh759 million in the previous year. Shareholders' funds have increased to Sh15.34 billion from Sh9.41 billion.

    Chief financial officer, Les Baille, said the decline was due to the falling handsets price and the increasing sales by dealers who now purchase their handsets directly from other suppliers.

    Chief executive officer, Michael Joseph, said pre-paid sales continued to be a predominant service, although the post-paid customer base had doubled. "Our post-pay customers tend to be our higher spenders, and their ARPU, [average revenue per user], has remained high, as these subscribers increase their usage of our new services, particularly data," said Mr Joseph.

    The firm will spend Sh14.7 billion to improve services. Its total expenditure in switches, base stations, billing systems and other support systems stands at Sh38 billion.

    The firm put up 143 additional base stations, including five satellite sites and 14 satellite stations, bringing the total to 550 at the end of the year. Thirty per cent of the additional base stations were to increase coverage in areas such as Gatundu, North and South Kinangop, Nyanza, Kericho South and Kisii South.

    Mr Joseph said that to cater for growth in the next six to twelve months, the company had commissioned three switches since April, 2004, to make it nine switches that are fully operational.

    Safaricom coverage has expanded over the last year and now stands at 74 per cent of the population. The company launched a data service that allows post-pay customers to access internet and their office system while on the move and away from their desks.

  • Leading SA IT solutions and services provider arivia.kom on Wednesday announced its financial results for its fourth year of being in business.

    Revenue declined by 7,8%, from R1,728bn in 2004, to R1,594bn, which resulted in a lower absolute Ebitda of R200,4m and Ebit of R84,6m. However, in relative terms, Ebitda margin increased to 12,6% from 12,4%, and the net profit for the year amounted to R63,5m, up from R55,6m. Profit before tax has remained almost unchanged from the previous financial year at R90,5m.

    Arivia.kom Chief Executive Officer, Zeth Malele, is satisfied that the results indicate the group's commitment to investing strategically in its resources and delivery capabilities. According to Malele, arivia.kom has had to correct certain historical discrepancies pre-dating the group's formation in 2001, such as the buy-out of certain employee related benefits - leave, post-retirement medical aid and gratuities.

    In addition, the group elected to invest in the realignment of its operational models to changing market requirements. It has established a consulting enterprise, in line with its existing range of service offerings and its business strategy, which has resulted in noticeable benefits. "Through these innovations and strategic repositioning, we are consolidating our position as a market leader. Arivia.kom has achieved the distinction of having the second largest market share of IT professional services in South Africa, as indicated by research company BMI-T," says Malele.

    In the 2004-2005 financial year, the group secured new business with clients in both the private and public sectors, in pursuit of its goal of diversifying its revenue base from its traditional clients. These include the South African Post Office, UUNet, Sentech, Engen, Minolco, Leverponds, De Beers Marine and the Departments of Home Affairs and Correctional Services, to name but a few of the agreements secured in South Africa.

    In terms of Black Economic Empowerment, an increasingly critical factor in the IT market, arivia.kom has continued to aggressively drive its group-wide BEE initiatives. Arivia.kom's staff complement at the end of the financial year, consisted of 49,0% Black and 33,0% female permanent employees, and the group has spent approximately R66,7-million of assignable business (74,4%) on BEE procurement.

    Malele emphasises that though the group has encountered considerable challenges in its growth strategy, it remains wholeheartedly committed to its vision and strategic intent to become the dominant ICT solutions provider on the African continent. "Our focus in the 2005-2006 financial year will be on the further execution of the strategic imperatives set at the launch of our business, and which have, to date, worked very well for us, regardless of the challenges we have had to overcome."

  • Celtel Zambia has started the process of offloading ten percent of its shares to Zambian investors, Celtel Zambia managing director David Venn has disclosed. And Venn has announced that Celtel Zambia would connect 28 rural towns to its network in the next two months.

    In an interview at Kalambo Falls before launching Celtel Zambia's network in the area, Venn said the company was now geared to implement its licence condition over localising ownership.

    Venn said although he could not name any of the investors the company was discussing the purchase of shares with, the process had gone well, with a deal likely to be sealed soon.

    "We have realised that the company is not yet ready for listing on the Lusaka Stock Exchange (LuSE) and this has made us explore other avenues of incorporating local investors in Celtel Zambia," Venn explained.

    "Though I cannot give you more details, I am glad to report that we have made good progress in getting some Zambian investors to take up, for a start, 10 per cent shares. We are initially targeting institutional investors and as we progress, we shall invite more Zambians to buy shares."

    Once this happens, Celtel Zambia would have made progress, offering at least 25 per cent shares in the company to Zambian investors.

    Under the terms of its licence in Zambia Celtel is required to sell up to 41 per cent shareholding in Celtel Zambia Limited to Zambian Interests. But the company is negotiating with the government to agree on the percentage that needs to be transferred.

    Additionally, Celtel has the obligation to acquire a further 10 per cent interest in Celtel Zambia Limited from one of its local partners. When the exercise period of this option ends, Celtel Zambia Limited may then be listed on the stock exchange.

    Venn also said Celtel Zambia was committed to spreading its service across the country because communication was vital to stimulating development.

    "This is why we have targeted to connect at least 28 towns in the next two months. And today's launch here in Mbala marks the start of a campaign to connect rural areas," he said.

  • - Celtel Uganda is seeking a court order to recover UGS2.9 billion (USD1.67 million) in interconnection fees, plus damages and 28% interest it claims is owed to it by Uganda Telecom (UTL). It alleges that the two signed a memorandum of understanding in 2000 to set interconnection fees across their networks but did not include mobile services in the deal, instead arranging that a new interconnection agreement would be drawn up to include the mobile segment. However, it appears that the companies failed to execute a new contract as they could not agree on rates, and the matter was only resolved in December 2003 when the regulator issued its own set of interconnection fees.

    - South Africa's fixed-line phone company Telkom slid more than 8 percent on Monday as investors sold the stock ahead of a mammoth dividend payout. The company will pay a four-rand annual dividend plus a five rand special dividend on July 8, but the shares trade ex dividend from Monday. Telkom shares tumbled 7.99 percent to 105.99 rand by 0732 GMT, the top loser on the Johannesburg top-40 index, which slipped 0.66 percent. "The stock is falling because it is trading ex dividend," said one Johannesburg-based analyst.

    - The Namibian government has announced plans to sell off a 34% stake in mobile operator Mobile Telecommunications Company (MTC) to an international or regional player by the end of the year. The state said that the proposed sale would go hand in hand with the transfer of a further 15% stake in MTC to black economic empowerment partners. Interested parties have been given until 15 July to express an interest in the process before the tender is launched. The value of the sale has yet to be disclosed. At the end of March 2005 MTC had 360,000 subscribers to its network, around 90% of which were prepaid.

    - The Kenyan government looks unlikely to agree to Vodafone’s offer to purchase an additional 11% stake in mobile operator Safaricom, having demanded that a 1998 shareholders agreement under which Telkom Kenya and Vodafone own and manage Safaricom be re-negotiated. The re-negotiation will begin on 12 July, and the government has said that no change of ownership will take place during the process.


  • * The legendary Yossi Barkan, VP Sales of IP Planet has announced that he is leaving after five years. The company has recently been merged with Gilat. He will continue in place to hand over to his successor. His farewell message reads:"Africa has a very special place in my heart and I think that with you all we achieved many nice things and did good business". He will be a hard act to follow.

    * At the Intelsat Connections conference last week in Nairobi Jean-Michel Trumpf, Gateway Communications:”Some people in Europe will be surprised that you see 3G networks in Africa before some countries in Europe.” He also said that 80% of long distance traffic in Africa is on satellite. He laid out a vision of an IP-based network for Africa that would allow different countries to make calls between each other in two hops or less.

    Avi Krainer, Technical and Sales Director, Alldean Kenya was heard to complain:”Why do we have to pay USD2,500 licence fees on a piece of equipment that costs only USD400?” He identified three new markets in the region - Northern Uganda, Southern Sudan and Somalia - all emerging from internal conflicts.

    In a fascinating exchange, Eric Ram of Fusion Telecommunications international asked panel members what they thought the proper contention ratio should be for broadband offered over satellite. Andre de Toit of ViaSat (which he moved to in March from Transtel) said he thought 50:1. The Panel Chair asked ISPs in the room and the two who spoke (from very different countries) agreed it was more likely to be 75:1.

    Also:”te.” Also:”You have 2 million people in Lubumbashi who have relatives in Zambia. They want cross-border communications.” Talk about his network design and how possible to get calls between two countries using more than one hop.”

    July 20 & 21, 2005 - CSIR International Convention Centre, Tshwane, Pretoria

    For more information:

    24 - 30 August, 2005 - Cape Town, South Africa

    For more information, visit


    Deputy Regional Director/Programmes Manager

    The Media Institute of Southern Africa – the leading organisation advancing media freedom, free expression, media Independence and diversity in the region seeks a key strategic player to occupy the newly created position of Deputy Regional Director /Programmes Manager at its regional office in Windhoek, Namibia.

    Programme Specialist – Broadcasting and ICT

    This is a key position with pivotal role in ensuring that MISA achieves its mission of advancing media freedom and freedom of expression through broadcasting and ICTs in the region. The successful individual will report to the Deputy Regional Director and be responsible for developing and implementing strategic Interventions to promote broadcasting diversity and ICT policy and regulation.

    Communication and Marketing Manager

    As an advocacy organisation advancing one of the most fundamental human needs, this position is key to the success of MISA in its journey to promote media freedom and free expression in the region. The successful individual will report to the Regional Director and be responsible for directing the planning and execution of the communication and publicity activities of MISA.

    All positions are for 3-year renewable contracts and offer competitive salaries.

    Closing date: July 10, 2005

    If our correspondent is "off the mark" or you have factual amendments, mail them to us and we will include them in subsequent News Updates. If you'd like to contribute, write and let us know.

    If you need information about a particular place or issue, just send your questions in. We are always happy to follow up on readers concerns.

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