Ghana special: Celtel to launch as Zain in Q3 and considering 3G roll-out
The dead hand of the Ghanaian Government has prevented a good market from reaching its full potential and becoming a great market. Everyone knows what needs to happen but somehow it never quite seems to get done. Nevertheless competition in the mobile sector is about to hot up. After lengthy delays Ghana Telecom (with its One Touch mobile subsidiary) looks likely to be sold to an international player. Zain looks likely to launch operations in Q3 of this year and a sixth licence will be granted, probably to the modest and retiring Mike Adenuga of Globacom. In this issue we publish what is probably the first interview with Zain’s new CEO, formerly CEO with One Touch, Philip Sowah and we also look at the rise of VAS services in an interview with Rancard Mobility’s Kofie Dadzie.
Back in Ghana after a three year absence, the most striking thing is the growth in Wi-Fi hot-spots both pay-for in public spaces and free in hotels. There are also several confident wireless ISPs including Busy Internet and iBurst. However, the joys of accessible bandwidth were rather undercut by a city-wide power cut: one step forward, one step back.
The Government’s long backlog of past messes (Ghana Telecom, Westel and Voltacom) is shortening but it’s been over five years and counting. Westel has been sold to Celtel who will relaunch as Zain this autumn.
The Government is still in negotiation with Vodafone (who had people in the country for two weeks doing due diligence) and France Telecom. Other operators – Russian and Indian – were mentioned but these hardly fit the criteria that everyone seems to have set: respectable international operators capable of making the required investment. The company is currently ludicrously over-staffed (3,700 people) but the Government appears to have made no effort to pick up the costs of making anyone redundant.
The National Infrastructure Company – which will based on the Voltacom fibre assets along with the in-fill network Huawei is building – will appoint a professional CEO but will inherit the Voltacom staff and stay part of Government. Not exactly the recipe to light the blue touch paper for significant change.
SAT3 prices are down to US$2,250 on the basis of the GISPA deal but Ghana Telecom now seems to be offering these to all takers, prompting GISPA to renegotiate. At a national level, both market leader MTN and Tigo – frustrated at the quality of Ghana Telecom’s offer – are building their own fibre networks. MTN may be no 1 (with over 50% of the market) but customers are unhappy with current levels of network congestion. The NCC’s public ultimatum to the operators (which seemed to follow a similar move by Nigeria’s NCC) seems to have disappeared into the mist. All the mobile operators are selling GPRS and EDGE.
There will soon be six operators in a licence process that it’s hard not to believe will result in Globacom entering the market. But with a total potential of 10-11 million subscribers, there may well be enough for everyone despite the predictable moaning about too many operators.
Kasapa (which will soon be bought by an international company) is offering its network to ISPs to help them sell Internet services, giving them about a third of the revenues. By the end of 2008 or early in 2009 it will introduce EVDO which will ratchet up the expectation level in market. Coverage is currently 7 out of the 10 regions in the country.
In terms of the priorities of the regulator NCA, it will first make a 3G allocation to existing operators before moving on to making Wi-MAX spectrum allocations. It still maintains that VoIP is a technology and if you have a proper licence you can do it. But unlike Kenya’s CCK it has made no move to give ISPs a new licence to include VoIP and this undoubtedly will hold up the arrival of Triple Play.
The NCA says that the Wi-MAX licences will have “Triple Play capabilities”. Unfortunately NCA has to follow the rather slow-moving Government that has ruled out more liberalisation while it offloads Ghana Telecom. It remains to be seen whether the process will pick up speed once that deed has been done.