Issue no 337

top story

  • Over the Christmas holiday French media conglomerate Vivendi has headed south into Sub-Saharan Africa with the purchase of Onatel by its North African subsidiary Maroc Telecom. Francophone Africa was until relatively recently France Telecom’s “backyard” but it is now the subject of a wide range of investor interest as the names of the losing bidders demonstrates. Vivendi also owns a 54% share in Mauritania’s Mauritel and is set for further expansion on the continent.

    Maroc Telecom paid US$290 million for 51% of Burkina Faso’s fixed line and mobile operator Onatel. The rest of Onatel is owned by: the Government (23%), staff (6%) and others (20%). Onatel has 100,000 fixed line subscribers and and its mobile subsidiary Telmob 400,000 mobile customers (around 40% of the country’s mobile market). Burkina Faso had only a 0.8% fixed line teledensity and 8% mobile penetration at the end of 2006.

    The losing bidders were: Detecon (Germany), Essat Teleholding (India), France Telecom (France), Monaco Telecom (Monaco), Saudi Telecom (Saudi Arabia) and Sistema/MTS (Russia).

    Interestingly the price paid for the company on a per subscriber basis is relatively modest. On the basis of the combined subscription total, Maroc Telecom paid US$580 per subscriber and US$720.50 if you base the price only on the company’s mobile subscriber base. This compares with sums that reach almost $1000 a subscriber for the larger recent deals like MTN’s purchase of Investcom. That said, the company will require a high level of investment after relatively low levels when it was in Government hands.

    Pre-Christmas Maroc Telecom announced that it would invest US$600 million in its operations in Morocco. This coincided with one of its competitors Maroc Connect (part of Morocco’s ONA Holdings) announcing its voice service will start early this year. Maroc Telecom faces two main competitors in its home market and will doubtless be relieved to be buying into a market in Burkina Faso where the current levels of competition have allowed it to retain a significant part of the mobile market.

    According to Abdeslam Ahizoune, President of the Board of Maroc Telecom on signing the deal: ”We are convinced that access to telecoms and more widely to ICTs is a powerful factor in economic and social development.”

    Attention now switches to who will be the winner for the award of the long-delayed second national operator licence in Senegal. According to Senegalese newspaper Le Quotidien, Maroc Telecom is interested in buying the licence. It will have to wait patiently for the almost glacial progress of Government processes in that country.

    Francophone Africa has some of the larger privatisation deals coming up in 2007. These will almost certainly include the financially challenged Gabon Telecom, Cameroon’s Camtel and – who knows – it might even be the year for Mali’s Sotelma. Someone has to buy it before France Telecom-owned Ikatel completely fillets its markets.

Telecoms, Rates, Offers and Coverage

  • - Batelco has signed a mobile roaming agreement with Orascom Telecom in Algeria. Batelco mobile customers can now make and receive calls while in the North African country.

    - Mobile telephone operator Telecel Zimbabwe has installed new software in a move set to boost communication services offered by the company. The new software equipment, Short Message Services Centre (SMSC), is expected to improve the speed and efficiency of message services delivered by the company.

    -  MTN Uganda explained that recent network congestion due to users calling all at the same time! Good we’ve got that clear.

    - South African cellphone company Virgin Mobile may have to bow to consumer demand and backtrack on its intention of never offering free handsets to customers. Weak subscriber numbers may force a U-turn, since South Africans equate a "free" phone to good value for money. Virgin is advertising a free Motorola handset -- available only to users who buy a high-end Motorola Dolce & Gabbana phone for R125 a month, who receive a free lower-end handset as well.

    - The Asterisk Development Team has announced the first  release in the Asterisk 1.4 series, Asterisk 1.4.0! Along with Asterisk, Asterisk-Addons, Zaptel and libpri were also released as 1.4.0 versions.As usual, the release files are available on the  servers via FTP and HTTP, and have been signed with GPG keys to  ensure their authenticity.


  •   The Uganda Communications Commission's new licensing regime has started. This means MTN and uganda telecom's (utl) five-year duopoly as national operators of telecommunication services has come to an end, paving the way for new players.

    A policy governing the new licensing regime is not yet ready, but the minister has issued guidelines. According to the guidelines, companies will receive a single-tier licence for infrastructure irrespective of geographical coverage or technology. The companies will also have an opportunity to acquire service and infrastructure licences, but will have to operate under the two licences.

    Three categories of licences will be issued. The categories are: public service provider licence, infrastructure provider licence and general licence permits.

    Already licensed under this regime are TalkTelekom and Warid Uganda. The latter has yet to commence operations. However, there are service providers who were already in existence by January 2.

    New Vision

  • The Egyptian telecommunications company Quicktel that won the bid to jointly manage Telkom Kenya's subsidiary Gilgil Telecommunications Industry (GTI,) is expected to modernise the Gilgil-based complex and make it a regional player in the sub-Saharan market.

    According to Sammy Kirui, Telkom's managing director, the joint venture will allowTelkom Kenya to source products from the plant at cost price. "Telkom will also have access to modern equipment that it currently imports from the Far East and Europe thus make a huge saving on capital expenditure as it responds to a growing telecommunication market," said Kirui.

    Quicktel has a successful track record in acquiring privatised telecommunications manufacturing facilities and companies in Africa. The company is design-oriented and licensed to produce its own equipment in the fields of CDMA, test equipment, passive network solutions and switching systems.

    Over the years, Quicktel has formed strategic alliances with blue chip technology companies. Companies that Quicktel has built partnerships with include Minnesota-based 3M telecommunications company - a diversified technology firm that manufactures, assembles and supplies 3M's distribution boxes. Germany-based technology firm Krone Gmbh is another telecommunication company that manufactures connectivity products for copper and optical fibres.

    According to the bid terms, Quicktel acquires a controlling stake of 70 per cent and gets to bring in a new management team, while Telkom Kenya will retain a 30 per cent stake. Quicktel, also a 70 per cent owner of the Egyptian Telephone Company beat other bidders after offering to pay $24 million for the complex. The company has proposed to pay 20 per cent of the amount up front, while the balance will be staggered over the next five years.

    Kirui said only two firms, Quicktel and Muringa Holdings, had qualified for the bid. Muringa Holdings' technical assessment failed to attract the mandatory 75 per cent required, said Kirui. The other losers were Kenya Power & Lighting Company, Timber Treatment International, Treated Timber Products and Sao Hill of Tanzania.

    Quicktel, which was established in the early 1960s to cater for a growing demand for telephone sets and switche,s is a leading Egyptian telecommunications company specialising in manufacturing and provision of advanced solutions for the fixed telecommunication networks.

    The company boasts an impressive array of own brands of products. Its product portfolio includes cordless telephone sets, CDMA fixed wireless terminals, fixed phones, mobiles, GSM wireless phones, distribution boxes and steel cabinets. The company has also set up a manufacturing plant with backing from the Swedish global conglomerate Ericsson.

    Initially, the Egyptian Telephone Company was publicly-owned but in 2000, it was taken private and Quicktel acquired 70 per cent of the company and took over its management.

    The revamped GTI complex will create direct jobs for both skilled and unskilled labour in addition to training opportunities for technicians and information technology personnel in Kenya. The GTI complex was established in 1991 to assemble and manufacture telecommunications-related products for the defunct Kenya Posts & Telecommunications Corporation. Gilgil was chosen as part of the government's efforts to encourage the location of industries away from the major urban centres to stem rural urban migration.

    The complex comprises mechanical, electronics and carpentry workshops, a maintenance centre and a pole treatment plant. It assembles, manufactures and sells its products to a variety of customers ranging from government ministries and departments, to telecommunication companies, flower farms, the Kenya Power and Lighting Company and educational institutions.

    When it was established, GTI had a ready market; however, liberalisation of the telecommunications market presented competition as other players were licensed to procure and sell end user products (like telephone sets) that were also being assembled at GTI. This, coupled with bureaucratic procedures and late response to changes in technology dulled GTI's competitiveness in a highly liberalised environment.

    The East African

  • Developing countries led by India, China, Brazil are now taking the lead in setting global standards in the rapidly transforming telecommunications sector due to convergence of hitherto separate communications and entertainment services, says Hamadoun Toure, the new secretary general of the Geneva-based International Telecommunications Union.

    "The standardisation in the telecom sector used to be dominated by a rich boys club because only the industrialised countries were setting standards," he told IPS in an interview, suggesting that there is a major change now. "The good news is that developing countries like India, China, Brazil are now in the forefront of setting standards at ITU, which augurs well for the world, " Toure said.

    African countries such as Kenya, Nigeria, and Mali among others are also participating closely in deciding telecom standards at a time when the industry is subjected to breathtaking changes, he said.

    Toure, who is the first candidate from sub-Saharan Africa to lead the ITU at a time when "convergence" has become the order of the day, says he is not worried by the profusion of new technologies or the rapid shake-out in telecom companies. Telecom analysts are not sure whether ITU will be able to play its traditional standard-setting and regulatory role in a turbulent technology-driven environment.

    Due to convergence of what are called Internet Protocol networks, companies that used to provide different services -- telephone operators, Internet service providers and cable TV firms -- are all able to bundle these services from one source.

    In the wake of new mode of communications like telegraph and then telephone, ITU was set up in 1865. Fixed telephone lines continued to rule the roost for well over a century, with public telephone monopolies calling the shots in a large majority of countries.

    The rapid disappearance of the public monopolies coupled with the emergence of a few private companies such as AT&T in the United States, Vodafone, France Telecom, BT and Hutchison Whampoa are creating an unusual situation at the ITU where governments had so far set standards.

    ITU went through a difficult period following the changes, especially the crash of telecom companies in 2001. Its mandate for setting global standards, distributing radio-frequency bandwidth, and settling accounting rates between countries came under intense pressure. Switzerland where ITU is headquartered decided to reduce its contribution on the ground that the multilateral body does not have much role to play in the coming days.

    The new secretary general says he is ready to prove that ITU can "help and strengthen the convergence", maintaining that it is his task is to "ensure that there is a good marriage in these technologies and a good level playing field for all the members and all the players."

    He says in a world awash with technologies like voice over Internet protocol (VOIP), which are breaking all the barriers, there is greater need for standards. Having come from the private sector, he looks positively to the latest mergers and acquisitions in the global telecom services industry.

    Last week, AT&T caused a major upheaval in the U.S. telecom services industry when it took over BellSouth Corp in the largest telecommunications takeover in U.S. history. Similarly, Vodafone is upping the scales for buying the Hutchison Essar, India's fourth largest mobile phone operator.

    "It is good for telecommunications because all our constituencies -- governments, industry, and consumers -- are doing well and surely, the consumer will definitely benefit from all these mergers and takeovers," Toure argued.

    But the telecom historians have already announced that fixed telephones that was the mainstay of the ITU all these years will disappear soon. "When you are talking about changes, I must emphasise that ITU is adapting to changes from telegrams to telephone and now convergence between digital and telecommunication technologies."

    Besides, "it took 100 years for telephony to spread to one billion people and now it took 25 years to spread to an additional billion of new subscribers," said Toure, who came from one of Africa's poorest countries, Mali.

    Toure says the telecom sector in Africa which is currently experiencing a digital divide will grow rapidly over the next five to ten years because of new technologies.

    Nigeria is experiencing a 400 percent growth in the mobile telephones, followed by South Africa and Gabon. The ICTs (Information and Communications Technologies) are helping to transform many activities in Africa.

    Toure's biggest tasks are bridging the telecoms and digital divide, especially on his own continent, management of the distribution of bandwidth, or what is called the frequency spectrum management to ensure there are no unseemly conflicts between countries in placing transmitters that can jam communications in far-flung places, and more importantly managing global cyber-security.

    Toure reckons cyber-security is his principal goal, because the ITU was given that role by the Information Summit in 2005. "We have to avoid cyber-war which will be catastrophic and worse than a worldwide tsunami," he warned, underscoring the need for an international framework and standards in the ICT-driven world. Toure said he will set examples of how to arrive at appropriate global standards in the telecom sector, and strengthen national, regional, and international regulation.

    Inter Press Service

  • The only handset factory in Nigeria is now gathering dust as the Chinese equipment vendor, ZTE has stopped production for more than eight months. According to reports, the company had closed shop for the second time in two years as it was closed for two months in 2005 over administrative problems.

    When news men visited the handset factory in Abuja recently, they observed that the administrative office and customer centre were covered with dust. The waiting room of the factory was also littered with pieces of paper and dirt while a handful of security men kept vigil at the entrance.

    An impeccable source, who had worked with the company, explained that the factory had not assembled any handset since it was inaugurated by the former Minister of Communication, Chief Cornelius Adebayo, in May, last year. The source said that the company had been trying to sell the handsets it had assembled before the visit.

    The source said that most of the workers in the factory who were neatly clad in ZTE factory overalls during the ministers visit were only hired and trained for the event.

    The source said that the 20 workers who worked at the factory during the visit were trained a day before the visit and after the inauguration they were each paid N2,000 for two days service. "My brother worked there for two days and he collected his N2,000 after the minister's visit and left for school, " another source at the factory said. The minister of communications had commended the Chinese company for providing jobs to so many Nigerians during his visit.

    Adebayo had asked the Chinese company why they were assembling handsets instead of manufacturing as was stipulated in their proposals and agreement with the ministry.

    The ZTE Nig. officials said the assembling of the sets would precede manufacturing, which, they added, would begin after the staff had been trained and facilities were set up.

    Investigations at the ZTE Nig. headquarters in Maitama revealed that the Chinese company had hired two sets of workers since it started operations in 2004 and only one out of the 50 staff employed was still with the company. "All the others were disengaged on the excuse that the phone market was not bringing in profit as expected," a source at the headquarters said .

    The source further revealed that none of the workers at the factory was given an employment letter based on the excuse that they would only get their letters after some months of probation. Asked if they were paid any disengagement package, the sources said: "All the workers only got their salary for the months they worked."

    The source said that customers had been complaining over the "exorbitant rates" of the handsets and frequent faults.

    ZTE staff member Lin Wen, who had hired some workers at the weekend to clean up the factory refused to comment on the closure. He said that only the top officials at the ZTE Nig. headquarters in Maitama had authority to speak on the situation. When reporters visited the headquarters of the company in Maitama for the second time some officials of the company said the top officials had travelled out of the country and they would be away for some time.

    This Day

  • South Africans have become a nation of electronic greeters, with more than 1,5-billion cellphone text messages sent over the recent holiday season. MTN alone handled 1.17-billion SMS messages over Christmas and New Year, almost double the number it carried last year. But fast fingers and thumbs have not completely replaced the more personal touch of a phone call, with MTN reporting a 46% rise in voice calls from last year to an astonishing 1.87-billion calls during Christmas and New Year.

    MTN said its network had been able to handle that massive rise in traffic because of a significant investment to boost its capacity for the festive season.

    Customers are also getting more techno savvy, said Bernice Samuels, its GM for corporate affairs, with a 400% leap in the number of MMS, or multimedia, messages sent. The network delivered 8.8- million messages containing pictures, video and sound.

    "Our big story is the phenomenal growth of MMS traffic," Samuels said. "The uptake of personalised, fun technologies indicates to us that customers are vying for our lifestyle- and value-driven products and services. We were certainly glad to help our customers share special moments with friends and loved ones over the holidays."

    The figures from MTN trounced Vodacom, even though Vodacom has by far the most customers in the country. Its 20.2-million subscribers give it a 59% share of the cellphone market. Vodacom SA's network carried more than 350-million SMS messages, divided almost equally with 153-million sent over Christ-mas and 152-million delivered as the calendar rolled over. That was up from 260-million festive greetings sent the previous year.

    Vodacom also reported a "staggering increase" in multimedia messages, with 1.3-million sent over Christmas, up from 780000 a year ago, and 1.4-million sent over the new year, up from 450,000.

    "This is an indication of subscribers being more in tune with technology and making greater use of its benefits," said chief communications officer Dot Field. No network congestion was reported, she added.

    Cell C also said it had been able to carry more voice and data traffic this time around by upgrading its network just in time for the peak festive season. Its 2.9-million subscribers sent 19-million text messages on Christmas Eve, Christmas Day and the Day of Goodwill, and followed up with 16-million more messages as 2006 turned into 2007. That translates into each customer sending 12 messages. Even so, Cell C handled just a tenth of the number of messages sent out over Vodacom's network.

    A year ago, Cell C carried 12.3-million SMS messages as the year ended, and for the dawn of 2005 it had handled 8.9-million. Despite the heavy traffic, said Cell C's media liaison officer Vinnie Santu, the network managed a successful call completion rate of 99.1%.

    Business Day

  • Indian state-run fixed line incumbent Mahanagar Telephone Nigam Ltd (MTNL) has launched nationwide mobile services in Mauritius, completing a full portfolio of telecoms services in the country, including local and international fixed line voice telephony, the last of which was introduced in June 2005. ‘With the launch of countrywide mobile services, we have now launched all the telecom services - mobile, fixed line (Fixed Wireless Terminal) and International Long Distance in Mauritius,’ said R S P Sinha, managing director of MTNL. Pre-paid mobile services are being offered under the banner Mokoze, and post-paid services have also been launched, Sinha said.

    MTNL was granted licences to offer fixed line, cellular and ILD licences in Mauritius in 2004. It entered the international calls market through its local unit Mahanagar Telephone before adding FWA services in phases to build up its nationwide coverage. Having soft-launched its mobile products during the course of 2006, MTNL – the second mobile operator in the country – inaugurated its nationwide network on 15 December.


  • - Two international call licences will be offered by Egypt's National Telecommunications Regulatory Authority by the end of February, reported the Daily Star, Egypt. The release of the licences has been delayed by a year as the NTRA has sought favourable market conditions and has allowed Telecom Egypt, the sole current provider, more time to prepare for a loss of revenue. In 2005, 27% of the firm's revenue came from overseas calls.

    - Senegalese regulator ART has announced that a new numbering plan will be introduced in July 2007 to avoid a shortage of numbers. Phone numbers will have 8 digits instead of the current 7 digits.

    - Two foreign firms have been selected by the Ministry of Trade and Industry to study Ethiopia's finance and telecom sectors, in order to help Ethiopian trade negotiators enter the accession process at the World Trade Organization (WTO), equipped with arguments that these sectors should remain sheltered from competition for at least eight years. The American Nathan Associates has been contracted to study the impact of liberalizing the telecom sector.

    - The telecom sector has created 290,000 jobs directly and indirectly, the Ugandan information and communication technology minister, Dr. Ham Mulira, has disclosed. The creation of the jobs was a result of growth in revenue and investments in Uganda

    - Econet Wireless Kenya Ltd has moved to court to block next month's scheduled award of a licence to a second national telephone operator. In an application heard  by a vacation judge at the High Court in Nairobi, Econet wants the process stopped, contending it would render useless an appeal it has lodged with Kenya Communications Appeals Tribunal. In that appeal, Econet has asked the tribunal to set aside the award of the tender to Vtel Consortium which won the license with a $170 million (Sh12 billion) bid.

    - The Nigerian Communications Commission (NCC) has announced that an auction for 3G frequencies, plus additional spectrum in the 450MHz and 1800MHz bands, will be held early in 2007.

    - The Guinean government has banned the use of cell phones while driving in the country and reinforced the use of seat belts onboard of vehicles. Offenders are liable to pay a fine varying between 15,000 and 40,000 Guinean francs (US$1 = GF 6,000).


  • Canar Telecommunication, the nationwide provider of fixed lines, data and internet services in the Sudan has announced the commercial launch of Sudan’s First 3G wireless broadband internet services for individuals and businesses under the brand name"Canar Go".

    Sudanese Canar Telecommunication announced the delivery of wireless broadband internet service, Canar Go, in the Sudan, which will contribute to the development and growth of their lives and businesses, the firm said in a press release.

    "Launching Canar’s new broadband service, which coincides with Sudan’s celebration for the Independence Day, is considered a contribution from Canar to the process of development and growth witnessed in Sudan today" stated Ali Ben Jarsh, the Chief Executive Officer of Canar Telecommunication.

    Canar is planning to launch a number of unique and innovative services that will contribute in supporting the telecommunication sector, individuals and businesses in the Sudan. Furthermore, services to the remaining cities and states will be covered and connected to the international submarine network, which will link the Sudan to the remaining parts of the world.

    Sudan Tribune

  • Fixed line incumbent Malawi Telecommunications Limited (MTL) has announced that it intends to sell its 36% stake in internet service provider Malawinet because it plans to set up its own ISP later this year. Press Corporation Limited (PCL), the 80% shareholder in MTL, said in a statement that the move would be part of a wider expansion drive for the company.

    The move has sparked fears that the incumbent will target the markets held by the independent ISP sector. An announcement of a new SNO licensee should be made some time in Q1 2007. Some ISPs believe that MTL should not be allowed to compete with existing ISPs until the SNO is announced as there would then be a genuinely competitive market.

    As it stands almost all of Malawi’s ISPs depend on MTL for connectivity and the launch of an ISP operation by MTL may spell a big challenge to the existing players in the market. PCL group chief executive officer Matthews Chikaonda said MTL will be investing close to USD70 million across its operations over the next three years in a bid to improve service delivery. Established in 1997, Malawinet is one of the largest ISPs in Malawi. Its largest shareholder is US Comnet.


  • Wireless broadband provider, iBurst has revealed an aggressive growth strategy, ahead of an anticipated boom in data services in the local market. “We anticipate a capital expenditure rollout of R350 million (US$48.5 million) on new infrastructure,” says Alan Knott-Craig jnr, MD of iBurst SA.

    Knott-Craig says the broadband provider hopes to more than double its subscriber base by adding 50,000 subscribers to its current totally of 35,000 subscribers. “We attribute the anticipated growth to the overall increased demand for broadband services throughout SA,” says Knott-Craig.

    He adds that coverage expansion will take place evenly throughout the year, growing at 10 base stations at a time. We will continue to focus on improving our coverage in our existing areas and then will expand the coverage to tier 2 cities and towns,” he explains. It is anticipated that the infrastructure rollout will begin by the end of this month.

    MyADSL founder Rudolph Muller comments: “iBurst's growth figures are feasible since Telkom is struggling with ADSL support and installations.” He adds that iBurst is currently the only real alternative to ADSL for users who want to use more than 1GB of bandwidth per month, and there is a large potential broadband market looking to upgrade their 56k modem connections.

    “High-speed Internet access is fuelled by both affordability (always on and flat-rated) and new bandwidth-intensive services like YouTube, which are specifically developed with broadband connections in mind.” Muller adds that local calls in SA remain expensive, which in turn makes dial-up access expensive. “Broadband access can, therefore, not only bring the advantage of high-speed, always-on access to consumers, but also reduce their monthly Internet bills.”

    Outside of South Africa, iBurst technology has been deployed in Ghana and Kenya but it is believed the company has ambitious plans to seize a greater level of country market share on the continent.


  • The Ugandan government is planning to build a national backbone throughout the country after securing a $106 million loan from the Exim bank of China but this has not gone down well with the two national operators MTN and UTL. Balancing Act’s Uganda correspondent Esther Nakkazi interviewed the Chief Executive Officer MTN Uganda Noel Meier by email about it and below are excerpts:

    Q: What have you covered so far in terms of backbone coverage?

      By the end of next year MTN, will complete the remaining fibre link to the Kenyan border – we currently have fibre till Bugiri. This will link up with the Telkom Kenya fibre that will eventually run from Malaba to Nairobi to Mombasa and form part of the East African Backhaul System (EABs). EABS is a joint venture project among operators from Tanzania, Burundi, Rwanda, Uganda and Kenya.

    This Backhaul system will link all the five East African Community countries to the EASSy Submarine cable to be laid along the Eastern African seaboard.  MTN and 30 other operators in Eastern and Southern Africa are involved with this latter project.

    To the West, we are in discussion with UTL to share capacity on our fibre links and thus avoid duplication of infrastructure roll-out. MTN already has fibre up to Mbarara and it has been mooted that UTL complete the fibre route to Rwanda from Mbarara to Katuna, linking up with a fibre to be installed by MTN Rwanda to the Rwandan border. This will link via the Rwanda operator’s fibre into Burundi and Tanzania and in turn to the second EASSy landing point at Dar-es-Salaam.

    Further to this and as part of our quality assurance objectives, MTN is to ensure that our national backbone is provided with full resilience by completing what we call ‘self healing’ rings around the country. These rings will ensure that should a link be interrupted, transmission can be restored by routing network traffic ‘the other way’; around the ring.

    This will lead to significant increases in network availability in especially rural areas where links are prone to interruptions ranging from power issues, theft, vandalism and damage to fibre caused by activities of contractors etc…

    We have therefore put in place a backbone that is based on different technologies, but should by the end of next year be fully optic-fibre based running from border to border. Indeed, we intend by the end of next year to have not only a national backbone, but a regional East African link (EABs) that will deliver not only regional traffic, but together with EASSy, international traffic that is of high quality and affordable.

    Q: Are you comfortable with the new regime that is allowing new players to come in and develop infrastructure? (UCC has changed the licensing regime to cater for services and infrastructure development separately which was not the case when you came into the market)

    We have no problem with increased liberalisation. Our concern is that the necessary changes to the existing laws, regulations and licenses have not been made. In January 2005, new policy proposals were published by UCC after due consultation with all stakeholders.

    We were satisfied with the process that led to these new policy proposals as well as the outcomes, including a well laid out road map that contained conditions precedent to opening up the market and timelines for the repeal of existing laws and licenses. This road map has not been followed. We believe this absence of due process could undermine the enabling regulatory environment that Uganda has been reputed for. Our desire is to see that chaos is avoided. Clear and transparent guidelines and laws need to be put in place.

    Q: I understand the two national operators including MTN have protested to government which is planning to build a national backbone. Apparently MTN wants the government to buy their fibre cables that have been laid. Is this so?

    MTN would not be in a position to request government to buy our fibre. We would of course be happy to share our fibre with any national or even regional initiative as is happening with EABs and our proposal to swap (rather than duplicate fibre) with UTL bears testimony to our thinking. We have also committed ourselves to hand over 2 fibres (of the 24 available fibres) to the EABs initiative.

    What we have advised is a rationalisation of these fibre resources to deliver economic efficiency for the country. Sharing resources in a network industry like telecommunications lowers costs for the operators, the resellers and the end users.

    Secondly we have not been formally informed about this national backbone plan. We believe it would be in the interest of the industry for government to advise the Operators, as key stakeholders in the Telecommunications industry, of their plans. We believe we could offer valuable input. It is unfortunate that we have not been able to continue open dialogue on such crucial matters, as was the case in the past.

    We have merely advised, through different fora, that such a route (of the proposed backbone) should avoid duplication of existing backbones. MTN were most surprised to hear that Government has now decided that it needs to build its own backbone after repeatedly pressing the Operators to make use of infrastructure sharing arrangements, a philosophy we have adopted accordingly amongst ourselves.

    Q: If government developed a national backbone and looped it on to your existing cable would there be a problem?

    None whatsoever, as long as clear guidelines are in place and commercial, cost-based, reciprocal compensation is agreed for all parties involved. What should be avoided is a situation where the national backbone becomes idle or is inefficiently run and it becomes a burden on the tax payer.

    We contribute 1% of our gross revenues to the Rural Communications Development Fund (RCDF) for example. We should avoid a situation where these funds are diverted to the maintenance of an idle “national” backbone, that duplicates existing infrastructure, rather than on stimulating demand and supply of ICT services in rural areas.

    Q: What were MTN’s license obligations as a national operator concerning the development of infrastructure for the national backbone?

    At the time MTN Uganda was licensed as a Second National Operator (SNO), there were a number of obligations attached to that license. These obligations as an example included installing 89,000 lines in five years, providing payphones at county headquarters, and providing telecommunication services while achieving certain quality benchmarks.

    However, there was never a specific requirement for building of a national backbone. The provision of a transmission network (otherwise called a backbone) was nevertheless always going to be a necessary element in MTN Uganda’s infrastructure rollout. 

    Q: Have they been fulfilled?

    All the license obligations have been fulfilled, indeed exceeded many times over. In putting together a telecommunications network to deliver not only the license obligations, but also meet the demands of a market which far exceeded license obligations and indeed drove subsequent network expansion, a comprehensive national backbone had to be built. This backbone comprises of 2 technologies:

    · Fibre optic in mainly Kampala and along the main transmission routes going initially East and West, and now also North,

    · Microwave for smaller backbone links into the more rural areas feeding off the ‘main’ fibre optic routes.

  • The way we do things has changed in the last few years mobile phones became more affordable.

    Take, for example, the short message service, or SMS as it is popularly known. It is now the medium of interaction in popular radio and TV programmes or season's greetings and invitations. There is an addition to our vocabulary - smsing.

    Our lives have been tremendously changed by technology. This is a perfect illustration of the magnitude of change.

    A local beer company once held a competition that required participants to send entries of bottle tops by post. A story is told of a gentleman who went ballistic when he woke up one morning from a night of heavy drinking to find his little son scattering his treasured collection of "prize-wining" tops.

    Today such a humiliating quarrel over bottle tops would not arise since all the old fellow needs to do is instantly SMS the details of entry to the company server, and he will be notified of the outcome by SMS.

    And if this is what the simple SMS can do, what revolution would computers and the internet cause if they were made accessible to more people?

    Advertisements along the road from a country's major airport to the city centre is said to reflect its core economic activity.

    And what do we see from Jomo Kenyatta International Airport to Kenyatta Avenue in Nairobi? An array of what the world calls ICT (information and communication technology) messages are lined up to entice us - from mobile phone handsets and wireless service providers, computers, TVs and so on to radio stations.

    They are the gadgets and services that matter, and what George Gilder calls "the vectors of growth, the sweet spots of finance" (Telescom: The World After Bandwidth Abundance, Touchstone, 2002). So if the information age is where the money is, who does not want to be there?

    One sector that is going to drive the next phase of the internet boom, or Web 2.0, is e-commerce, which is doing business electronically without the seller and the buyer being in physical contact.

    Lower communication costs is enabling people to reach wider markets and making it possible for goods and services to be traded in a whole new way.

    For example, some women's groups in Tabaka, Gucha district, now sell their soapstone artifacts to the world by simply taking digital pictures of their new products and posting offers on their Web ite,

    A firm in Eldoret that spins yarn and makes woollen products cannot imagine business without the e-mail, which has made it easy for them to reach the sophisticated western market at the click of the mouse.

    There are many more Kenyans making innovative efforts in the e-business, especially in the service industries of consultancy and outsourcing. People used to believe in duty-free shops as real bargains, but they now say they are as cheap as the internet.

    Although e-commerce is the future of enterprise, consumer protection, intellectual property rights, privacy and security are issues of grave concern. For instance, on the internet you do not know whom you are dealing with; it could be a robber or a con man.

    Thus, for e-business to grow, people must trust the technology. People are not only buying and selling cars, computers and kiondos and other "brick and mortar" goods online, but they are also dealing in information, music and software, which are now categorised as products. There is an urgent need to enact e-commerce laws. The law shoulddeal with if electronic evidence is admissible in the court.

    Kenyans would do more business if there was legislation and the right infrastructure for electronic transactions, and more tourists would be happy to come and see the new wonder of the world at the Maasai Mara and make payments online.

    Although it may be difficult to tame the Internet because of its cross-border nature, all is not lost as there are tools of control. Recent efforts by the Government and development partners to tackle reforms in e-transaction and e-commerce laws are commendable, but more needs to be done.

    The Nation

  • - Trustfund Pensions Plc, Nigeria’s biggest pension fund with over N60 billion fund under its management has launched Trustfund On-line and Trustfundmobile to enable customers to access to access their accounts from any part of the country through their mobile phone or online via the internet.

    - East African Safari Air Express passengers can now book, pay for and print out tickets online anywhere in the world.


  • The Nigerian Federal Government in line with its avowed commitment to deploy information and communications technology to accelerate economic growth has signed a three year agreement with Microsoft. The partnership agreement signed in Abuja will ensure the implementation of initiatives that will contribute to effective governance, and to the social and economic development of Nigeria.

    One major benefit of the agreement is that it will help in building the skills of the nations software industry as well as help in streamlining the Federal Government's use of Microsoft's software tools. The new three-year agreement which means that the Federal Government and Microsoft have expanded their local strategic partnership builds on the one implemented in 2003. Commenting on the partnership agreement, Mr. Thomas Hansen, the regional general manager for Microsoft in West, East and Central Africa (WECA), stated that "the agreement is positive for Nigeria, it is positive for Microsoft and, given the country's standing on the continent, it is positive for the African ICT industry as whole. It means we can really start demonstrating technology's capability to enable social and economic development.He added that Given our goal to serve as a role model for technology adoption across Africa and other emerging markets, partnership frameworks like the one signed today with Microsoft are significant."

      In his remarks, Prof. Turner Isoun, the Hon. Minister of Science and Technology,stated that the agreement was in line with the Federal Government clear vision of how technology can help enhance the services delivered to the people of Nigeria. He added the agreement "can streamline internal communications, improve transparency, reduce costs and help us provide efficient service to citizens. It can also support broad scale social and economic development, stimulate our private sector and increase Nigeria's global competitiveness. Microsoft by this new agreement will be working to make ICT available, accessible, secure and relevant to the Federal Government and the people of Nigeria. This includes continuing to support programmes such as the Computers for All Nigerians Initiative (CANi); to translating software into local languages such as Igbo, Hausa and Yoruba; and to protecting citizens from the threats of cybercrime. Microsoft will also be driving programmes that enable a broad spectrum of Nigerians to gain experience and expertise in ICT. This includes continued investment in the Partners in Learning technology-in-education investments, as well as the sustainability of digital villages already established across nine Nigerian states.

    This Day

  • The government of Rwanda has committed itself to provide a laptop to every Rwandan primary school pupil within five years, the education minister has said.

    Dr Jeanne d'Arc Mujawamariya said President Paul Kagame made the commitment during the latter's meeting with the Chairperson of 'One Laptop per Child' (OPLC) initiative, Prof Nicholas Negroponte on Tuesday, January 2, at Village Urugwiro.

    Mujawamariya was yesterday addressing journalists during a joint press conference with Negroponte at Village Urugwiro at the end of the latter's visit to Rwanda. "This is part of the government's objective of steering the country into a knowledge-based economy by the year 2020," said the minister. She added that OLPC will provide the initial laptops and technical support to test the initiative.

    The minister underscored that the initiative would strengthen the quality of the already existing free and compulsory primary education, by adopting sophisticated tools for learning. Negroponte said that Rwanda was the latest country that has shown willingness to accommodate OPLC programmes.

    "There is almost no country in the world that has not asked to participate. Brazil, Argentina and Uruguay will collaborate with Rwanda. It's very important because a country like Brazil has a long history with 'One Laptop per Child' he said. He said OPLC will soon unroll its services in Rwanda to boost the country's education and technology programmes. In Rwanda, the project will be jointly pursued by the ministries of infrastructure, education, and that of Science, Technology and Research in the President's Office.

    The New Times

  • Over the holidays, and MobileCrunch reported on a new fuel cell technology by Samsung that might have a direct impact on the digital divide.

    Essentially, what they've done is created a docking station for their laptops that is powered by methanol, which is both cheap and easy to produce. The docking station gives a laptop to stay charged 40 hours a week for four weeks. That's an astonishingly long time, given how my current laptop battery won't even let me get through a single DVD movie. They expect to ship the docking station before the end of the year. Meanwhile, they're also working on a pint-sized version, quite literally - a miniature power source that requires the equivalent of a coffee cup's worth of methanol to power a laptop for a week.

    Most of the news coverage I've seen so far about fuel cells has been in relationship to cars and foreign oil dependency, so I was pleasantly surprised to hear about Samsung's announcement. There's no mention how much the fuel sells will cost, but if they can get the price point down, it'll be interesting to see how it penetrates developing nations and other places with large communities of people who don't have access to reliable energy sources. Methanol fuel cells would help people who are off the grid to power their digital tools more reliably, and this could impact the adoption of mobile and portable Internet devices. Meanwhile, the only by-product of the fuel cell is water. Now if Samsung could ensure that this water is safe to drink, talk about killing two birds with one stone....

    Andy Carvin’s blog

  • The first batch of computers built for the One Laptop Per Child project could reach users by July this year. The scheme is hoping to put low-cost computers into the hands of people in developing countries.

    The XO machine, as it's called, likely will be the first computer ever been used by most of these children . Because the students have no expectations for what PCs should be like, the laptop's creators started from scratch in designing a user interface they figured would be intuitive for children. Ultimately the project's backers hope the machines could sell for as little as $100.

    The first countries to sign up to buying the machine include Nigeria, Brazil, Argentina, Uruguay, Libya, Pakistan and Thailand. The so-called XO machine is being pioneered by Nicholas Negroponte, who launched the project at the Massachusetts Institute of Technology's Media Lab in 2004. Test machines are expected to reach children in February as the project builds towards a more formal launch.

    Negroponte explained that three more African countries might sign on in the next two weeks. The laptop is powered by a 366-megahertz processor from Advanced Micro Devices and has built-in wireless networking. It has no hard disk drive and instead uses 512 MB of flash memory, and has two USB ports to which more storage could be attached.

    "I have to laugh when people refer to XO as a weak or crippled machine and how kids should get a "real' one"," Negroponte said. "Trust me, I will give up my real one very soon and use only XO. It will be far better, in many new and important ways."

    The computer runs on a cut-down version of the open source Linux operating system and has been designed to work differently to a Microsoft Windows or Apple machine from a usability perspective. Instead of information being stored along the organising principle of folders and a desktop, users of the XO machine are encouraged to work on an electronic journal, a log of everything the user has done on the laptop.

    The machine comes with a web browser, word processor and RSS reader, for accessing the web feeds that so many sites now offer. "In fact, one of the saddest but most common conditions in elementary school computer labs (when they exist in the developing world), is the children are being trained to use Word, Excel and PowerPoint," Mr Negroponte said. "I consider that criminal, because children should be making things, communicating, exploring, sharing, not running office automation tools."

    One Laptop plans to send a specialist to each school who will stay for a month helping teachers and students get started. But Negroponte believes that kids ultimately will learn the system by exploring it and then teaching each other.

    The new user interface, known as Sugar, has been praised by some of the observers of the One Laptop Per Child project. “It doesn't feel like Linux. It doesn't feel like Windows. It doesn't feel like Apple," said Wayan Vota, who launched the blog and is also director of Geekcorps, an organisation that facilitates technology volunteers in developing countries. "I'm just impressed they built a new (user interface) that is different and hopefully better than anything we have today," he said. But he added: "Granted, I'm not a child. I don't know if it's going to be intuitive to children."

    Trial versions of the operating system in development can be downloaded to be tested out by technically-minded computer users around the world. The machines are being made by Quanta Computer Inc., and countries will get versions specific to their own languages. Governments or donors will buy the laptops for children to own, along with associated server equipment for their schools. The project itself has gotten at least $29 million in funding from companies including Google Inc., News Corp. and Red Hat.

    This Day

  • - China has offered Guinea a US$9-million "preferential loan" to help computerise the West African country's system of administration.

    - UAE based IT distributor EMPA is predicting that Egypt could become the biggest market in the Middle East next year, reported Gulf News. The North African country could see more than 1m computer sales in 2007 depending on orders from the Egyptian government. This compares with anticipated order of 750,000 PCs and notebooks from Saudi Arabia.

    - Libya is to invest about 121.3 million dinar on a project to equip 3,400 classrooms in its tertiary schools with computers

Digital Content

  • On 1st January, launched two new website services - an online mobile database and a gallery of images. The mobile database is a resource designed to provide information on mobile usage around the world. With a particular emphasis on social and environmental initiatives, articles and reports, it aims to assist academics, professionals and practitioners interested in ways mobile telephony is being used to enhance environmental, social, humanitarian, political and economic causes. The database launches with details of several dozen projects, articles and reports, and will be continually updated with past, present and future initiatives as they come online. Users are encouraged to help by submitting details of their own projects, and volunteers are encouraged to assist with general updating.

    At the same time, a gallery of mobile-related images has also been launched on the site. Until now, high quality royalty-free images have been hard to find on the web. The mobile gallery aims to meet this need by providing NGOs and non-profits with royalty-free photographs for use in brochures, general literature, websites or project reports and proposals. The gallery launches with approximately forty initial images. Additional categories and countries will be added over the coming weeks.

  • For the first time in KCPE history, candidates and their parents yesterday received details of their results directly on their cellphones and through the Internet. The results were accessible through the Kenya National Examination Council (Knec) website or on the cellphone after sending a prescribed short text message (sms) to 7070.

    Last February, Kenya Certificate of Secondary Education candidates were able to access their results by logging on to the council website, but yesterday was the first time the short text message was used to relay examination results. This year's top candidate David Wamugi got a breakdown of his results on the sms service.

    His father, James Wamugi, sat for his primary school examination 27 years ago at Gathathiini primary school in Nyeri. But it took him a day to receive his results from the school, unlike the instant services his son's generation is enjoying. Last week, the senior Wamugi told the Nation: "I didn't know that they had received the breakdown until I saw it on the mobile phone. "In our days, it took a day to receive the results and then one had to see the result slip to get a breakdown."

    The website appears to have been inundated with visitors and it often failed to download the results, unlike the first instance in February this year when KCSE candidates used it. The public also expressed concern that strangers could access the results of any candidate whose index number they held and suggested that a security measure be put in place to protect the candidates.

    The tradition has been that provincial directors of education attend the news conference where the Education minister was releasing examinations. They were then expected to physically transport the results to their respective offices where their juniors from the districts and head teachers would collect them. Students in Nairobi would receive their results the same day while those in other parts of the country would have to wait for a day or more, depending on how far the school was from Nairobi.

    In Mombasa, hundreds of parents jammed cyber cafes trying to know how their children had performed but left frustrated as the Knec website was yet to be updated.

    Boniface Otieno, who wanted to know how his sister had performed, said: "I have spent three hours trying to refresh this website but there are no KCPE results."

    The Nation

  • - Nokia users can access Egypt Yellow Pages through Nokia Mobile Search, after the mobile phone maker released a search plug-in. The device connects users to It can be accessed in Arabic and English.

Mergers, Acquisitions and Financial Results

  • MTN Nigeria has concluded plan to purchase VGC Communications Limited (VGCCL) to the tune of $70 million (N9.3 billion). Sources close to VGC informed our correspondent that the deal was completed last weekend and hand over processes would soon commence to enable MTN to fully take control of operations.

    With the development, MTN remains the largest one single network in the nation's telecommunications market, having before now recorded over 10 million subscribers while VGC has over 20,000. It was also gathered that the negotiation, which began early last December has an undisclosed agreement pending when the company must have taken full control of VGC.

    It would be recalled that earlier last year, business icon, Ibrahim Jimoh expressed interest in the take over of VGC but later withdrew when the Nigerian Telecommunications Limited (NITEL) went up for sale.

    VGC Communications, also known as VGCCL, is a limited liability company licensed by the Nigerian Communications Commission (NCC) to provide cabling and radio telephone services nationwide and has laid extensive fibre optic cables, and internet service provision and recently obtained ULO from the NCC mid 2006.

    Established in April 1995 with the primary objective of providing all the communications related services required by the residents of Victoria Garden City and Ikota shopping Complex, VGC went on to enhance the quality of life and ability to conduct business activities in those areas of Lekki Peninsula, Lagos, Nigeria, with an authorized share capital of N100,000,000, which has been paid in full.

    VGCCL is a subsidiary of Modern Communication Technologies (MCT) Limited a company registered in Gibraltar and itself a wholly owned subsidiary of Globe International Holdings South Africa, which is a holding company of many subsidiaries in Nigeria with activities in the construction industry, manufacturing and other activities.

    Modern Communication Technologies Inc. (MCT) is the Communications arm of Globe International Holdings S.A. with 100 per cent ownership of VGCCL shares.

    On the other hand, MTN Nigeria's GSM network comprises over 2,336 base stations and an extensive transmission infrastructure, providing access to approximately 60 per cent of Nigeria's population.

    Daily Champion

  • Celtel Zambia says that it has raised US$105 million from a syndicate of banks, to assist in repaying existing loans and fund further network expansion. This landmark transaction is the largest locally raised Kwacha and foreign currency syndicated term loan facility with offshore participation for a Zambian corporate borrower.

    "The loan facility is an indication of the confidence that banks have in our company. It also reflects the confidence that both Celtel and the financial sector have in the Zambian economy," said Celtel Zambia Managing Director, David Venn.

    "In the past, we have heavily relied on our shareholders to fund growth and rollout, but we are now firmly established and as such, we are now able to raise significant financing from the market on our own," he added.

    Established in April 1997, Celtel Zambia is the leading operator in the Zambian GSM mobile market, with an 80% market share and serving over 1.2 million subscribers. Celtel International holds 88.88% of Celtel Zambia. The residual 11.12% is held by the International Finance Corporation ("IFC").

    Cellular News

  • The government of Kenya is considering abolishing the rule that stipulates that foreign companies investing in the telecommunication sector must allocate at least 30 per cent shares to nationals.

    It is the government's response to the perennial disputes between local and foreign investors that have frustrated the conclusion of major telecommunications projects in the country, especially of late.

    The East African has learnt that the Ministry of Information and Communication has already drafted a document with proposals for a more liberal regime for foreign investors. The developments come in the wake of a major falling out between the shareholders Vtel Holding Ltd - the company that only recently won the bid for a major telecommunications licence combining mobile and landline services - that has now plunged what was regarded as the most promising deal in the telecommunications sector in recent years into uncertainty.

    V-tel won the highly contested licence, for which it bid an impressive Ksh12 billion ($169 million) - the single largest foreign direct investment in Kenya in decades. Well-placed sources told The East African that the government wants an arrangement where the 30 per cent local shareholding rule will be made optional, on the understanding that foreign investors have to sell the 30 per cent stake to the public through an IPO after a stipulated period.

    Before the Dubai firm won the bid, the licensing of the second national operator to compete with the lacklustre Telkom Kenya - the country's sole fixed-line operator - had proved to be a messy affair mired in court cases leading to several postponements.

    But hopes that the Vtel will hit the ground running seem to be fading after it turned out that its local partners are unable to raise their portion of the financial commitment.

    In a development that is eerily reminiscent of the woes plaguing Kenya's third operator Econet Wireless, the dispute between Vtel and its Kenyan partners seems destined for the courts, where it is likely to take years to resolve.

    Legal experts who spoke off the record to The East African trace the origins of the problem to a policy statement made by the government in 1997. In November of that year, the government published the "postal telecommunications sector policy statement," spelling out a new structure for the industry. It was this document that introduced the threshold for equity participation by local investors in privatised telecommunications companies.

    Specifically, the document stipulated that "any company licensed to provide telecommunications services in the liberalised market should have at least 70 per cent of its equity owned by Kenyans." In subsequent years, to make the regime more friendly to foreign investors, the rule was revised to 60 per cent for foreigners and 40 for locals.

    In the year 2002, then Minister for Information and Telecommunications Musalia Mudavadi published a gazette notice in which he changed the local equity threshold to 70 per cent for foreign investors and a minimum of 30 per cent for locals.

    Another condition that has come to affect the process and which Vtel will have to deal with is the requirement that the shareholding structure of the winning bid's tender cannot be changed before the licence is issued. This, say experts, is what has seen the South African-based Econet Wireless Ltd locked in one case after another.

    Sources tell The East African that Vtel was facing a crisis that emerged barely a fortnight after it won the tender, when it failed to formally submit its licence application.

    It is believed that Vtel, a $1 billion holding company registered in the United Arab Emirates, which serves as the investment arm of the Palestinian Telecommunications Company (Paltel) in the Middle East, North Africa and Asia, could easily pay its share of the licence fees, but was being held back by its local partners.

    Sources say the firm stated as much in a letter to the Communications Commission of Kenya (CCK) in which it sought an extension of the December 8, 2006 deadline for formally applying for the licence.

    Subsequently, one of the local partners, Unitel, denied in a press statement that they were unable to raise their share of the licence fee.

    Unitel's managing director Francis Makanga, insisted that the firm has the required funds. He said the company's documents were completed on time and are filed with the CCK and that it will have all financing ready for its shares by the time the licence fee is to be paid.

    Vtel Holdings, the consortium's bid leader for the second national operator, had written to the Communications Commission of Kenya notifying their intention to drop its local partner owing to its inability to meet its share of financial obligations.

    A profile of Vtel's local partners makes for intriguing reading. They comprise Kirinyaga Construction, a leading road builder in Kenya associated with tycoon Ephraim Maina; Unitel, which is said to be owned by the family of former District Commissioner Ben Makanga; Kusco, the umbrella body of more than 3,000 co-operatives; and businessman Michael Kirui, Nairobi lawyer Fred Ngatia and Fairacres Ltd coming in as minority shareholders. Loita Capital Partners International is the lead transaction advisor.

    Sources say Vtel, in its letter to the CCK, was seeking the nod to drop its partners on the grounds that they were facing difficulties coming up with their share of the licence fees. The firm says it will not be able to submit its application with Unitel as its partner, raising fears that the matter could be headed for the courts.

    Econet, has been involved in damaging feud with its local partners, the Federation of Co-operatives of Kenya and Corporate Africa after the two failed to raise their share of the licence fees, which saw the matter end up in court, where it is still stuck.

    Vtel's imminent falling out with its partners has put paid to a declaration by its Chief Executive Officer Nour Atout that the consortium will roll out both fixed line and mobile telephony networks at the same time, making a record of sorts.

    The pledge saw Telkom, Vtel's principal competitor as a national operator, declare it will also venture into the highly profitable cellphones sector, drawing immediate protests from its partner Safaricom, the region's most successful cellular phone company.

    The East African

  • Telkom South Africa is in final stages of buying into Ucom, the consortium that owns 51% shares in uganda telecom. Uganda telecom's corporation secretary Donald Nyakairu said the two entities are at the price negotiation stage after completion of due diligence on both sides. The Government owns 49% shares in uganda telecom. If Telkom SA succeeds with this purchase it will be a first after a long run of unsuccessful attempts to buy other companies both on the continent and elsewhere.

    Telkom South Africa is a state-controlled company that also owns 50% of Vodacom, the largest telecommunications company in South Africa. The company is looking for expansion opportunities outside South Africa as it faces competition from the second national operator and from service providers like value-added network services.

    Telecom analysts say the Ugandan market is "extremely" attractive because less that 150,000 people have fixed lines out of a population of over 27 million.

    Telkom South Africa provides business and residential fixed line telephony, Internet and e-commerce data communications, satellite and broadcasting services. If completed, the deal is expected to boost uganda telecom, which intends to spend about $80m (sh140b) to strengthen its network. Uganda telecom has about 500,000 mobile phone subscribers and about 100,000 fixed line subscribers. The Ucom consortium is 60% held by Telecel, while Germany's Detecon and Egyptian group Orascom hold 20% each.

    New Vision

  • Africa’s financial sector aspires to world-class systems and standards that match best practices in developed economies. But at the same time, they have to seek growth in the region’s vast majority of unbanked who require low-cost mass banking services.

    The effective application of IT and telecommunication solutions is essential for developing a profitable balance between these two sides of the banking market. World-class systems have to be carefully examined and assessed for their appropriateness to extend services to mass, low-income, mostly rural customers – instead of widening the divide between a banking system that serves an urban elite, delivering high-value services to a limited market, and the vast majority of the population that remains unbanked and therefore excluded from the formal economy.

    The African Banking Technology Conference, hosted by AITEC Africa, the continent’s leading organiser of ICT conferences and exhibitions, will provide the region’s banking community with in-depth briefings from African and international experts that will enable them to assess latest banking technology systems and strategies to achieve an effective and profitable balance. 

    The theme of the conference is “Meeting Africa’s banking needs: World-class or all-class banking systems?” and will be held under the auspices of Kenya’s Ministry of Information & Communication.


  • Marten Pieters, CEO of Celtel International, has announced his departure from the operator as of January 2007. Moez Daya, currently Celtel’s Chief Technical Officer, will replace Pieters and will assume the role of chief operating officer of Celtel International as of January 1, 2007 until a permanent COO is appointed.


    29th January – 1st February 2007. InterContinental Sandton Sun & Towers, Sandton, Johannesburg, South Africa

    Hosted by ICASA and organised by the CTO  the digital switch-over forum will have meeting with regulators, policy makers and senior level decision makers from across the pan-African broadcasting industry.


    5-8 February 2007, Nairobi, Kenya

    The African Banking Technology Conference will provide the region’s banking community with in-depth briefings from African and international experts that will enable them to assess latest banking technology systems and strategies to achieve an effective and profitable balance.


    26-27 February 2007, Southern Sun, Grayston, South Africa

    South Africa faces a huge broadband demand, from all sides. However, the broadband access media and business strategies in South Africa still do not resemble the international standards. In order to reach these standards you as ISPs, mobile and/or fixed operators, need to assess the current and future potential of the African broadband market.


    26th March 2007, Nile Hilton, Cairo, Egypt.

    IDC's SMB Roadshow provides a comprehensive and trustworthy platform for discussing strategic IT issues directly impacting the SMB sector. Debate led by recognised experts and based on best practices and sound technology analysis provide objective and critical insights required by leaders in this sector. This event will target IT decision makers - by vertical industry sector - within SMBs across the region.


    28-30th May 2007, Kenyatta International Conference Centre, Nairobi, Kenya

    The subject is Building Infrastructures and Capacities to Reach out to the Whole of Africa, reflecting the significant efforts of African countries to set up their national and regional ICT infrastructures to create access to education, training and services for all.


    31st July - 2nd August 2007,  Johannesburg, South Africa

    Key decision-makers in South Africa and leading international players will share their expertise and forge invaluable business relationships in a highly interactive environment.

    - WI-WORLD AFRICA 2007

    27 – 30 August 2007, Michelangelo Hotel, Johannesburg, South Africa.

    In Africa, fixed-line infrastructure is lacking and there is a major problem with copper wire theft. Wireless communication is therefore a great alternative.


    Reporting to the Director of Information Systems & Technology, the successful candidate will be responsible for driving the implementation of E-Governance, which is aimed at improving government processes (e-administration), connecting citizens (e-citizens and e-services) and building external interactions (e-society), to provide leadership in ICT for development within South Africa and internationally, as well as providing overall strategic, financial, operational and people management of the E-Governance Section of the Information Systems & Technology Directorate.


    Uganda Telecom Ltd (UTL), a communications and information services provider has won a five year contract worth four million pound sterling ($7.6m) to provide and manage communications solutions for the Uganda Revenue Authority (URA).


    Omatek Computers has signed  an emobile deal with Globacom. The partnership agreement according to a statement is a capacity building mega partnership deal with Globacom that cuts across Nigeria and Ghana to make the organisation the first PC manufacturing outfit to bundle Internet connectivity with its line of computer notebooks produced from its factory.

    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.

    News Update is a free e-letter produced by Balancing Act that covers African internet content and infrastructure developments, It goes out to government, the private sector, education and NGOs. To subscribe, send a message saying "I want to subscribe" to

Web and Mobile Data_old

  • Some had given up on the problem ever being solved. The lopsidedness in the broadcast industry or to use a more naked word, anti-competition, was mostly pronounced in the DSTV and terrestrial areas of broadcasting.

    While the private broadcasters are mostly surviving on the skin of their teeth, mainly because of the ingenuity of their proprietors, the DSTV sector had remained a minefield, exploding the dreams of those who ever dared to think of business in the sector.

    At least last year alone about three operators died, resurrected and are now doing business on the fringe, singed by the firepower of the monopoly. The broadcasters soaked in the pressure, counted their losses and got on with life quietly until the Minister of Information and National Orientation, Mr. Frank Nweke Jr. rose against a practice of over a decade and half to begin to restore order to the system.

    No matter what you may have against the Minister, he is a man of very strong convictions who plunges in to achieve his goals once they are very clear.

    It was a chance meeting that Saturday morning over breakfast. Discussions had centred on the country, on patriotism and the role that a robust broadcast sector could play in making the country a better place. But regulation, he heard, needed to be reinforced, some drastic action needed to be taken to change the face of the industry.

    From the look on his face that very morning, one knew that something was going to give and that happened pretty soon when he knocked the Exclusivity Clause saying it would no longer rule the way business is done in the sector. In truth, the Broadcast Code had always frowned on Exclusivity but a seeming weakness in the system was exploited by Multichoice, the pioneer DSTV operator to run a monopoly operation for over a decade.

    If Multichoice did that in Satellite operations, NTA of course is doing same in terrestrial operations; being padded with government subvention to the detriment of the private operators who also have to struggle for adverts with the government station. But when the Minister struck that morning with his announcement, most people erroneously interpreted his actions as targeted against Multichoice.

    Before the ministerial intervention, Premiership organizers had given the indication that they were ready to treat Nigeria as separate basket instead of being lumped together with the rest of Africa. This decision was taken with some understanding. Nigeria has about the most robust broadcast market in Africa and had faced rejections because of some groups that would buy signals and warehouse them from being used by other operators.

    Aware of this development, the Minister pressed home his advantage by following up with a meeting in the UK involving Premiership organizers and some Nigerian broadcasters. There he unfolded the Nigerian position which was well taken by his hosts.

    That action by the Minster has brought some profound transformation into the DSTV sector. Apart from the old players who have been emboldened to begin to make plans to return to the sector, there is new enthusiasm. Plus this stirring in the sector, a young organization, HITV is warming up to launch services. A first sign of readiness to get into action, was the fight and defeat of Multichoice over the Premiership rights in Nigeria.

    It is also important to state here that even without product launch yet, this young organization has been credited in some quarters for fighting against the powers of Multichoice and breaking its monopoly. HITV knew what to do and this helped to provide some needed education to right some aggravated wrongs.

    But is it over yet? More could still be done for that sector but the area that really needs help at the moment is the terrestrial arm where the monopoly of the government station has gone unchallenged for years. For a deregulated sector, the NTA receives subvention from the government and collects adverts from the industry where its network status comes into advantage. This is not the way it is done in other parts of the world. It is either the NTA gets subvention from government and stop taking adverts or take adverts and leave government alone. But the latter is not likely to happen since government will always want to have full grip on the station for its various activities.

    One solution that has been proffered is for government to recognize more stations as network operators, like the NCC that appointed another national carrier, and encourage activities that will make private operators to thrive. This year the government needs the various media both public and private to perform at their optimal level in order to give vent to its various electioneering programmes.


  • Over 140 radio and television stations face closure for failure to register with the Media Council as required by the Electronic Media Statute 1996. Alfred Wasike reports that there are 150 radio and 13 television stations in the country.

    Only 13 radio stations including Beat FM, Capital FM, Central Broadcasting Service, Choice FM, Dembe FM, East African Radio, Kampala FM, Mama FM, Power FM, Voice of Life FM and Voice of Teso registered.

    According to a December 22, 2006 letter the Media Council secretary, Paul Mukasa, wrote to the Broadcasting Council secretary, Katongole Kivumbi, only East African TV fulfiled the requirement. The letter was titled "Renewal of license to telephone/radio stations by the Broadcasting Council"

    "You are aware of the statutory provision of the Electronic Media Statute 1996; Section 4 that requires radio and television stations to register their editors and apparatus with the Media Council.

    "Over time, the Media Council has sought to prevail on the numerous stations to fulfil this statutory obligation with little success. Only 13 out of almost 100 stations have been compliant," Mukasa wrote.

    The letter added: "The Media Council, during the plenary session held on December 14 decided to contact you (Broadcasting Council) as a sister organisation to enforce this legal provision by renewing the licenses of only those stations that have fulfiled this obligation." According to Mukasa, the stations face closure because they were licensed by the Broadcasting Council to operate but did not register with the council as required by law. Kivumbi said: "We shall only renew licenses of stations that have proof that they have complied with the Media Council."

    New Vision

  • Imagine paying as little as R60 (US$8.31) a month for multi-channel television. At the moment, the lowest you’ll pay for DStv, which is currently the only company offering PayTV, is R199 (US$27.55) per month for its compact offering.

    According to its website, to get DStv you will need a digital satellite decoder and a smart card. The standard decoder costs about R549 and the PVR decoder is R2 459. There are separate costs for installation and the actual dish that are not specified on the website.

    To get a DStv Premium, which offers you 55 television channels and 40 CD-quality audio channels, will set you back R419 a month. For PVR and dual view, you’ll have to pay a monthly access fee of R50.  DStv Compact is the cheaper option, which gives you 16 channels at a cost of R199 a month.  But potential DStv competitors like MaxTV are offering ten video channels for R59.95 a month.

    MaxTV is one of the companies applying for a commercial satellite and cable subscription broadcasting licence in which cellphone company MTN and Absa are both potential shareholders. According to the application, Absa Capital has a 25% stake in MaxTV and MTN 30%. Citabell TV Consortium (45) is the third shareholder.

    MaxTV says that in a move to allow customers, particularly at the lower LSM levels, easier access to PayTV, the primary transaction model will be rental.  The initial monthly rental will amount to R59,95, which will include the cost of the basic decoder, a smart card and satellite dish.  Consumers will have to fork out a R495 one off fee for the installation.

    MaxTV will offer three packages giving you either ten, 20 or 30 video channels and 30 audio channels that will cost up to R300 each month.  There will also be a pay per view option where subscribers of an entry-level package will be able to subscribe to an additional channel from any “higher” level package for a predetermined duration of time.

    For example, access to an additional movie channel for a Saturday night.  There will also be a video on demand option where the user can download movies or programmes by choosing from a menu and being able to watch them whenever they want.

    MaxTV has applied for 80 video, 50 audio and five data channels. Its application says that the company would be ready to broadcast 30 video, 30 audio and three data channels within 12 months of being granted the licence.  It also promises to increase the number of video channels to 45 within two years.

    The channel offering is pretty similar to what DStv offers its subscribers. A history channel, entertainment channels, music channels, movie channels, a channel targeting the Afrikaans community, a religious channel and so on.  The target market is LSM four to ten estimated to be about 8m households.

    E.sat is another company that’s hoping to get a share of the PayTV market. As far as what its offerings are in terms of costs or pricing, that information is confidential. What it does say, however, is that a lot of its channels will be locally compiled. And that it is for this reason that the costs of its service are higher than the costs of a service, which is dominated by foreign pass-through channels.

    Shareholders in e.sat include Sabido Investments, which owns  Sabido is owned by: Hosken Consolidated Investments (64%), Venfin Media Beleggings (Venfin) (31%) and Sabido Share Trust (5%). The company says that it is currently involved in negotiations with various third parties who may purchase shares in e.sat.

    A foreign company called Gulf DTH LDC (also Showtime) has expressed a serious interest in purchasing 10% of the issued share capital in e.sat, according to the company’s application.  Showtime conducts a direct to home subscription satellite service in the Middle East.

    E.sat says it plans to cater for the needs of people with disabilities. This will include making available to disabled viewers, where practicable and as and when technology permits, a remote control, which is designed in a manner to cater for them.

    Another player that hopes to enter the PayTV market is Sentech, a state-owned broadband network business. Sentech has also not disclosed what the costs of such a service will be.  Although Sentech is making the application, the SABC will hold 50% in Holdco, a company that the two will form. Holdco in turn will have at least a 51% shareholding in a subsidiary company, Newco.  Should the licence be granted it will be transferred from Sentech to Newco, which will operate the service to be known as Viewsat.  Currently there are 7.8m television households in South Africa, according to Sentech. This represents a penetration of 72% of the 10,9m total households.

    The existing commercial satellite subscription television service provider, with 1.3m subscribers serves predominantly the upper end of the market that earn R12 000 per month. Sentech says that it will be targeting households that earn in excess of R2,500 per month plus. This eliminates the bottom 40% of the television household universe, or 4.7m viewers, which will continue to be served by the free to air television broadcasters.

    Telkom Media will offer an entry point of below R100, including vat for PayTV.

    The basic package will consist of a sports channel, a movie channel, 24 hour South African news channel, general entertainment, education channels, music channels, home shopping channels, and SABC 1, 2 and 3.  To reduce barriers to entry, Telkom Media will rent set top boxes or decoders for the satellite service at R15. This will be against a three-year contract.

    Telkom Media has been created by four players – Telkom (66%), Videovision Home Entertainment (15%), WDB Investment Holdings (5%) and MSG Afrika Media (5%).

    The company has also made provision for an employee incentive trust (4%). Videovision has as its majority shareholder filmmaker Anant Singh and has produced over 60 motion pictures since its founding 15 years ago.  WDB Investment Holdings is an investment company wholly owned by a women’s development trust, a broad based benefit scheme.

    And MSG Afrika Media has shareholdings in television production house Curious Pictures, and advertising company The Jupiter Drawing Room. The company is owned by former Metro FM personality Given Mkhari and Simphiwe Mdlalose.

    Telkom Media, which will be known as I C Entertainment will also provide premium products that will enable subscribers to buy packages tailored to their specific interest.

    This will be complemented by on demand access to movies, sports, and television archives, and a catch up TV proposition that bring control of the schedule into the hands of the viewer using PVR capabilities.


  • - In Uganda, Nation TV (NTV) is on air promising to give rival stations a run for their money by broadcasting programmes that will cut across an audience of all ages.

    Airing on channel 54 on the UHF band, the 24-hour station, with 60% foreign content and 40% local, is currently broadcasting within a radius of 70km, that is up to Jinja and Entebbe.

    - The government in Zimbabwe has announced plans to rehabilitate and upgrade the existing radio and television transmission network this year while possibilities of expanding coverage are being explored.

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