Issue no 507 4th June 2010

top story

  • Last week Orange announced that its Orange Money service had been rolled out in three new countries (Madagascar, Mali and Senegal) and that it will be operational in all of its African territories by the end of the year. Russell Southwood spoke to Philippe Millet who was appointed to head up the operation earlier this year.

    The development of M-money services in Africa seemed to get going in fits and starts. Although M-Pesa took a year to get a critical mass of users, its rise has been so stratospheric that it has overshadowed most of the newcomers, including its own roll-out in neighbouring Tanzania with Vodacom.

    But this week MTN announced that its MobileMoney service had 890,000 users and that it expected to reach 2 million users by the end of this year. In other words, MTN has reached a critical mass of users and the effects of network growth will begin to take over.

    M-money services represent two things for mobile operators: the chance to add to their revenues and as a way of differentiating themselves in the market. Safaricom’s latest figures (see On the Money below) show that it got KS5.1 billion (US$61 million) from operating the service, a handy sum in a time of shrinking ARPUs. Last week Millicom International Cellular’s CEO Mikael Grahne cited money transfers, banking and insurance as the new services it would introduce to counter Bharti’s takeover of Zain.

    Against this backdrop, Orange has been rolling out Orange Money in its territories with some speed. Cote d’Ivoire launched over a year ago followed by Senegal (early May), Mali (mid May) and Madagascar (a couple of weeks ago to compete with Telma’s Mvola service). According to Philippe Millet, it will go live in all of Orange’s territories by the end of the year. After one year’s operation in Cote d’Ivoire Millet thinks that with 250,000 users it is close to reaching critical mass.

    Because of the complex regulatory issues, the service in Cote d’Ivoire is operated jointly with a bank and has been authorised by the Government’s Central Bank. The bank in question is BNP in West Africa but it may use other banks in other parts of Africa. The service requires customers to give (and have proof of) their name and address to meet KYC rules.

    The maximum amount a customer sends varies depending on local regulations in each country but is usually a few hundred FCFAs. There is no set-up fee for the customer and when the money hits their account they can use it immediately. According to Millet, some customers just use the account as a safe place to put their money.

    It charges a low percentage transaction fee for transfers and again this varies by country. It has all the features of M- money services elsewhere and additional will be added over time. In practical terms, the service is operated from a USSD menu which is very similar to the airtime top-up routine.

    So what are the issues in getting the service to a level where it is widely used?:”There’s a number of factors. It’s money, not airtime, so the customers want to be sure they can trust the service and they want to do this by testing the service. You need first to enrol customers in the city and they will convince their relations in the rural areas to use the service. To do this, you need a critical mass of users of at least a few hundred thousand.” Orange sees the potential as being the total mobile market and that the service may itself increase the company’s level of penetration in a market.

    But how will different services succeed in a single market with many players?:”The number of players and exact permutations in each country will differ. Eventually you may get 2-3 players. There’s already many organisations like banks and Post Offices offering versions of this service in some countries and some operators are already doing it in some countries. The difference with Orange Money is that we give you an account.”

    Will it reach a point where inter-operability between different operator products is desirable?:”We have to see what the competitive environment is first. But there will be a need to be inter-operability to some degree and it’s something we’re working on. There’s stuff that needs to be done between the telcos and the banks and it’s more complicated (than interconnecting operators’ voice and data services). It will happen.”

    “We’re also working on regional and international transfers and that’s coming up. We’re looking at several ways of doing with the customer charging to Orange and third party partners.”

    If MTN’s MobileMoney has a 16% share of its total subscriber base in Uganda, then the overall potential of M-money services will run into the tens and hundreds of millions within 3-5 years.

    In-house news: New website goes live

    Our long-awaited new website goes live today. For readers, the key advantages are as follows:

    1. It has its own search engine that is much better at finding items you want. It will filter by year and month and language. And now we are running a content management system, it will only bring up one item at a time.

    2. The design has been updated and improved which allows you to find your way round the different parts of the website. Also to reflect the convergence interests of our readers, we have now brought together the broadcast and telecoms newsletters on to the same website.

    3. The website allows you to see all the things we do, including a much clearer listing and access to the research reports that we publish.

    If you experience any glitches or notice any errors, please mail us on: info@balancingact-africa.com

    Readers’ responses

    Issue No 506: SMS becomes e-mail and chat – Safaricom implements new service and others will follow shortly

    In your Top Story you say that:”The only downside is that if your message is two SMSs long, you pay for two SMSs to send it but you pay nothing to receive it.”

    There's another downside. In South Africa, you can send about 3000 emails or instant messages with a GPRS-enabled phone for the price of one SMS. I understand this is about bringing email to the owners of non-GPRS phones, but at what cost?

    I’d rather get cheap GPRS-enabled phones into people's hands, teach them bandwidth-literacy and let them e-mail and instant message each other as cheaply as 'advantaged' users.

    Bill Tucker
    Cape Town

    Balancing Act

telecoms

  • Nigerian mobile operator Globacom has won a licence to operate in Senegal. The latest licence was issued by the Government of Senegal on Monday and signed by the country's Ministers of Finance and Telecommunications.

    A statement from the Office of Globacom's Chairman, Dr. Mike Adenuga Jr said the licence would enable the telecommunications giant to offer world class telecommunications services to the government and people of Senegal.

    The Senegalese licence will also allow Globacom to land its gigantic trans-Atlantic submarine cable, Glo 1, in the West African country with opportunities to extend the infrastructure to Mali. It will also give the telecoms giant the right to carry traffic for major operators, the government and wholesale customers.

    With this development, the people of Senegal have been positioned to be part of the telecommunications revolution which Globacom is bringing to Africa.

    Also, with the Senegalese licence, Glo will be able to provide international carrier services for the other telecoms operators in the country, Expresso and Tigo. The company which has gateway switches outside the continent is currently a major player in the global telecommunications industry.

    Other countries where Globacom has operating licences are Nigeria, Ghana, Benin Republic and Cote d'Ivoire. The company started operations in Nigeria in August, 2003 and introduced revolutionary products and services that made telephony affordable and available to Nigerians.

    This Day
  • Telecommunications and information technology company Africom (Pvt.) Ltd has launched a new satellite telecommunication port in Harare in a move that is set to enhance the company's IT and telecommunications services in the country.

    The new satellite teleport is expected to expand the company's satellite bandwidth, telecommunications networks and to improve its ICT services, especially in the remote areas of the country, which are at the centre of the Zimbabwean economy's agriculture, mining and tourism sectors.

    Said Africom Chief Executive Officer Kwanayi Kashangura: "Whilst satellite technology is not new in Zimbabwe, our investment will dramatically improve response times by reducing the latency between the satellites in the sky and our hub, resulting in faster communication."

    Speaking at the launch of the teleport, Postal and Telecommunications Regulatory Authority of Zimbabwe Deputy Director-General Alfred Marisa emphasized the increasing relevance of information and communication technology to the effective functioning of the economy. "Access to and the use of information and communication technologies has become a key pillar for firms and nations to compete and prosper globally.

    Commenting on this Marisa said: "Although this development should be applauded it should be appreciated for what it is, a stop-gap measure. It will help to connect the Africom customer to the Internet crowd. "However, fibre optics is today the preferred technology if the country is going to meet international standards in ICT utilisation."

    Africom (Pvt.) Ltd has been operating in the country for the past 15 years and was the first of the new operators to be granted a license by POTRAZ.

    The Herald
  • Indian mobile carrier Reliance Communications is considering a merger with South Africa's MTN, or roping in a strategic foreign investor to raise funds, the Economic Times reported today.

    The number two Indian mobile operator is ready to sell a stake in the company to raise funds to finance its foray into 3G mobile and wireless broadband access, the newspaper said, citing a person familiar with the plans.

    At an MTN board meeting on Tuesday, the South African telecoms major decided it would examine Reliance Communications' merger proposal, the paper quoted the person as saying. Officials at Reliance Communications and MTN could not immediately be reached by Reuters for comment.

    Abu Dhabi's Etisalat said on Wednesday it was looking to buy a stake in an Indian mobile operator, but did not disclose any names. A newspaper had reported it was in talks with cash-hungry Reliance Communications for a $3.8 billion deal.

    Reliance Communications and MTN had planned a tie-up in 2008 but the deal was thwarted by issues within the Reliance family.

    Reuters
  • LG Communications, Ghana's first mobile phone assembling company, has started operations in the country with a promise to give jobs to 30,000 youth from the National Youth Employment Programme by the close of the year.

    Roland Agambire, Chief Executive Officer of the company, said "rLG Communications has already concluded plans for the construction of a state of the art multi-purpose mobile phone assembling plant in Ghana, the first of its kind in Sub-Saharan Africa." The new assembling plant would be located within the Spintex industrial area.

    He said the company had 18 different brands comprising the G-series and the r-series of phones, adding that since it started assembling phones locally six months ago, it had already captured 30 per cent of the local phone market.

    "We are looking forward to capturing 80 per cent of the market by the close of the year, particularly because of the feedback we get from patrons of our r-72 phone, which looks very much like Nokia E72." rLG phones recently signed a $2.5 million contract with Chinese software and telecom infrastructure manufacturer, Huawei, to help produce 100,000 phones in Ghana.

    Mrs Millicent Atuguba, Communications Manager of rLG, told the GNA that Huawei was only in to give technical advice but the actual manufacture of parts and assembling was being done by Ghanaian technicians.

    The company also signed a memorandum of understanding (MOU) with Hong Kong-based laptop manufacturer, Ke Zhi Guang (KZG) Holding Limited, for the production of mobile phones in Ghana for the African, Asian and European markets at a contract sum worth a billion dollars.

  • - Telecom Egypt has backed away from its desire to buy out Vodafone's stake in its Egyptian mobile network, the company announced in a brief statement. Vodafone currently holds a 54.9% stake in the company, while Telecom Egypt holds 44.95%.It has been reported that Telecom Egypt could have to pay around £3 billion to buy out the Vodafone holding in the company.

    - Sierra Leonean government will liberalise the country’s international mobile gateway ‘soon’, breaking the monopoly held by incumbent telecoms operator Sierratel, according to local report.

    - Telecel Zimbabwe plans to launch GPRS and 3G services in either August or September, according to The Zimbabwe Standard. Telecel MD Aimable Mpore says the new infrastructure is currently being tested, and that the service will be available in all major cities at the time of launch. Telecel, Zimbabwe’s second largest cellco by subscribers, will become the country’s second mobile operator to roll out 3G, after Econet.

    - Nigeria’s telecoms regulator, the Nigerian Communications Commission (NCC), has confirmed that mobile number portability (MNP), which enables subscribers to retain their mobile numbers when they change service provider, will be introduced in the second half of the year.The introduction of MNP has become a necessity due to the high number of wireless subscribers in the country, which topped 70 million at the end of 2009.

    - Zain Kenya plans to roll out a third generation (3G) network in July following an expected cut in licence fees by the regulator, the Communications Commission of Kenya (CCK).

    - Telecel Zimbabwe, the country's second largest mobile operator, will launch 3G technology and GPRS by September this year.

    - The Cameroon Government says the country will host two new entrants in the mobile segments within the next months. The statement was made by the Minister of Post and Telecommunications in a speech he made June 1 during the ICT Day celebrations. The Minister however did not elaborate on the licensing process or the potential new investors’ identity.

    - South Africa’s Independent Communications Authority of South Africa (ICASA) has released its ‘Document on Spectrum Licensing Framework Regulations and Invitation To Apply for 2.6GHz and 3.5GHz Bands’. Under the new guidelines, bidding will start at ZAR750,000 (USD98,000). ICASA requires 2.6GHz licensees to achieve population coverage of 50% within two years of being granted spectrum. Vodacom, MTN, Cell C, Neotel and Telkom are all reported to be keen to get their hands on the spectrum, which is suitable for the deployment of Long Term Evolution (LTE) technology.

internet

  • Submarine cable company Main One, which has licences to land in Ghana and Nigeria, said it has completed the landing processes and would begin commercial service next month.

    Main One Chief Executive Officer, Funke Opeke, announced this last Wednesday at the Second West African Information and Communications Technology Congress (WAFICT 2010) in Lagos, said phase one of the submarine cable project from Accra, Ghana to Lagos, Nigeria has been completed and that the company had begun trial testing of all its equipment, with a sure date of rolling out services in Ghana and Nigeria on July 1, the same day that the cable would land the shores of Lagos and Accra.

    She said the landing of Main One submarine cable would provide full connectivity that would double what is currently available in Nigeria and that it would impact positively on businesses and reduce cost of bandwidth to a great extent. Speaking on further benefits of the expected submarine cable, Opeke said it would increase access to internet, facilitate fast broadband deployment, in addition to having a strong partnership between national and local service providers.

  • The National Information Communication and Technology Broadband Backbone (NICTBB) was switched on yesterday in 16 regions after the completion of the first phase of its construction.The move brings the hope of increased efficiency and reduced Internet charges in Tanzania.

    The backbone, which is the terrestrial continuation of the fibre optic submarine cables that landed in Dar es Salaam recently, has already led to a 99 per cent drop in Internet capacity charges.
    Internet service providers (ISPs) who spoke to The Citizen on the new development were optimistic that the backbone would greatly contribute to the reduction of charges of Internet services to consumers. However, they said that despite the significant reduction of broadband capacity charges, other factors, which have not changed much, have a role to play in determining Internet and data charges.

    Seacom Tanzania Limited managing director Anna Kahama-Rupia said her company would decrease its charges in the near future, but could not give a time frame for the reduction."We had to pass through Kenya for us to reach the landlocked countries of Rwanda and Burundi, but with the national backbone we shall easily penetrate through all regions in the country and reach those across the borders," she said.
    S

    anctus Msimbe, the SimbaNet corporate business manager said other factors, despite broadband capacity charges, were important in determining the pricing of Internet and data connectivity to consumers. He mentioned the factors as the Internet and data (content) prices from international providers.

    Capacity charges are costs incurred for using the infrastructure to transmit the Internet bandwidth or data. The capacity transmission services come in both protected and non-protected options. There are also expenses incurred by ISPs for connecting consumers with the backbone.

    He also said the minimum annual capacity (STM-1) to be provided through the new backbone is still too much and too expensive for most of the ISPs in the country.
    "I would advise the government to come up with smaller capacity offerings than STM-1, because, apparently, business models for most ISPs cannot afford to pay $180,000 per year," he said.

    The NICTBB project that was embarked on in 2008 and is expected to cost about Sh251 billion when it is completed countrywide at the end of this year.

    Its operational management will be handled by the Tanzania Telecommunications Company Limited (TTCL). The director for Information and Communication Technologies at the Ministry of Communications, Science and Technology, Dr Zaipuna Yonah, told The Citizen on Monday that work to construct the infrastructure was completed for phase I routes and that it was ready for use. "The work for phase one has been completed, this includes about 16 regions where we think have ICT potential users," he said.

    "Whereas initially, distance was also considered on setting charges for transmitting any capacity, Tanzania Telecommunication Company Limited (TTCL) will now be charging flat-rate independent of the distances."

    The project is funded by a $170 million soft loan from China and Sh30 billion from government sources.

    According to Dr Yonah, the first part of the project covers three routes, Northern Ring I that has point of presence in Babati, Arusha, Moshi and Tanga. And Nothern Ring II covering Dar es Salaam, Morogoro, Iringa, Dodoma and Singida. While the third route (Western Link I and II) have point of presence in Shinyanga, Mwanza, Geita, Biharamulo, Rusumo and Kambanga. The completed routes link the country to neighboring countries like Rwanda, Burundi, Kenya and Uganda.

    "Although some of phase II works have been covered in phase I, we are set to complete other routes such as those connecting us to Zambia and Malawi by the end of this year," said the engineer.

    The Citizen
  • The South African mobile phone company Vodacom has scorned the recommendations from the Mozambican regulatory body, the INCM (National Communications institute of Mozambique) that basic infrastructure should be shared between telecommunications operators, and instead it is pushing ahead with its own network of fibre-optic cables.

    The existing national fibre-optic cable is owned by the public telecommunications company, TDM, and Vodacom claims that TDM is providing an unsatisfactory service. At a Maputo press conference on Thursday, the chairperson of Vodacom's Mozambican subsidiary, VM SARL, Salimo Abdula, said that the TDM fibre-optic cable fails, on average, for 180 hours every month.

    There was certainly a serious breakdown in late April, when a cut in TDM's undersea cable, about 110 kilometres north of the town of Vilankulo, in Inhambane province, interrupted communications between the south of the country and the central and northern provinces.

    Suddenly, in Mozambique's second largest city, Beira, mobile phones ceased to work, and, because they were out of Internet contact with their Maputo head offices, no bank transactions via ATMs were possible. It took two weeks to repair the fault, and would have taken longer but for the fact that a ship with the appropriate equipment was nearby and agreed to do the job.
    No cable is invulnerable, and what happened to the TDM cable could just as easily happen to a cable owned by Vodacom or any other company. The real problem is the lack of back-up systems, which will not be solved by every operator putting its own interests ahead of those of the public, and installing their own cables.

    Vodacom has already set up its own fibre-optic network in Maputo, and has a microwave system linking Maputo to Beira, and Beira to Chimoio. By the end of 2011, the microwave transmission system should link the other main central and northern cities (Tete, Quelimane, Nampula, Pemba, Cuamba and Lichinga).

    Vodacom admits that it is "absurd" for different institutions to make heavy investments in fibre-optic networks covering the same parts of the country, but blames this on the poor quality of TDM's services. Abdula also noted that TDM is the main shareholder in Vodacom's sole rival, m-cel, the pioneer in mobile telephony in Mozambique. "You can't be a player and a referee at the same time", Abdula said of TDM, thus suggesting that it is favouring m-cel.

    The chair of the Vodacom Executive Commission, Jose dos Santos, said the company "has reached the conclusion that it would be better to push ahead with our own fibre-optic line because we want to offer a good quality service to our clients".

    The INCM would also like m-cel and Vodacom to share their transmission antennae. In principle both companies agree that would be a good idea. In practice, no agreement has been reached over prices, so each continues to build their own antennae, providing Mozambique with twice as many transmission towers as it needs.

    The INCM is strongly in favour of operators sharing infrastructures, but does not yet have the power to enforce this. That may change if the country's parliament approves a set of regulations on the matter some time in the next few months. The public tender for selecting a third mobile phone operator has been launched, and it would clearly be absurd to have three sets of mobile phone antennae springing up all over the country.

    Although Vodacom has yet to make a profit in Mozambique, the company has pledged to invest a further 2.1 billion meticais (about 63 million US dollars) this year in new technology and expansion of its network. It plans to set up 100 new transmission towers, mainly in the centre and north of the country (which compares with 50 towers erected last year).

    Vodacom began its Mozambican operations in 2003, but has yet to break into profit. In the 2009/2010 financial year, its losses were 230 million meticais (about seven million dollars), which dos Santos blamed on the depreciation of the metical against the US dollar and the South African rand.

    Despite continued injections of capital, Vodacom's ambition to become the market leader in Mozambique has been frustrated. Currently it claims to have a market share of 45 per cent, leaving m-cel as still the dominant player, with 55 per cent.

    AIM
  • - Work has commenced on building of the largest wireless network in Africa across the four campuses of the University of Nigeria, Nsukka. Google Inc., is the lead sponsor of the project to provide an internet bandwidth of 25 megabytes per second (25mbps) up from an initial 8mbps. Google's Office Lead, English Speaking West Africa, Nyimbi Odero, disclosed that the UNN wireless network infrastructure project is the first the company would execute as part of its Google University Access Programme in Africa. Officials say the project would be delivered in three months at the end of August 2010.

    - Cell C is reported to have started testing its HSPA+ network, capable of offering download speeds of up to 21Mbps, according to local press reports. Cell C announced in late 2009 that it will be investing around ZAR5 billion (USD649 million) to upgrade its network infrastructure, something which will allow it to compete more effectively with Vodacom and MTN in the mobile broadband market.

    - Last Wednesday the Tunisian Minister of Transport Abderrahim Zouari, announced the launch of the establishment of a single information system on board buses of the Tunis Transportation Company (TRANSTU) and regional transport companies. Henceforth the company's buses will be equipped with GPS (satellite positioning technology) and GPRS, a general packet radio service for wireless communication services.

    - Sameer Dave, Chief Technology Officer of MTN South Africa, has said his company is ready to cope with the influx of bandwidth-hungry international football fans later this month for the World Cup 2010, saying that his company currently has 120 live 21Mbps HSPA+ sites, in addition to in excess of 2,000 3G/HSDPA sites, of which 1,300 are 7.2Mbps and 14.4Mbps enabled. MTN will continue to invest heavily in its network in 2010, with a planned ZAR4.1 billion (USD535 million) network spend in across the year.

    - WirelessG announced earlier this year that it was planning to launch its Fli G-Connect service - Africa’s first inflight Wi-Fi Internet-access solution – later this year. The new inflight Wi-Fi service will provide all passengers with a Wi-Fi (802.11b/g/n) enabled laptop or mobile device access to standard Internet services such as websites, e-mail, Skype and social networking services.

    - MWEB Namibia has changed its name to AfricaOnline following the buyout of its majority shareholding by South Africa's fixed line operator, Telkom South Africa.Last year Telkom bought MWEB Africa and 75 percent of MWEB Namibia for about N$610 million. The deal came just after MWEB Namibia had taken over the operations of AfricaOnline in Namibia.

computing

  • Child helplines are an outstanding example of the benefits of modern communication tools in helping people access the information and resources they need. Children are among the most disempowered in all societies, least able to get information, support and help when they are in need. When their needs are ignored, they are in need of protection and if their rights are violated the adults around them, or they can reach out to a childline for help just by dialling a number.

    There have been several international and regional steps taken to strengthen the partnership between child helplines and the telecommunications services in an effort to offer greater protection to children. It is intended, that these will have a positive influence on the establishment and development of a formal partnership between Childline Zimbabwe, the Postal and Telecommunications Regulatory Authority in Zimbabwe (Potraz) and the various telecommunications providers in Zimbabwe so as to achieve better outcomes for children in Zimbabwe providing them with protection when they need it most.

    In 2006, the United Nations Global Study on Violence Against Children (VAC) was finalised. This study made 12 recommendations detailed in its final report, compiled by Professor Pinheiro, which were formulated for all stakeholders and states specifically to take action to prevent and combat violence against children.

    The most applicable recommendation for child helplines and telecommunications services and regulators was the following: "Create accessible and child-friendly reporting systems and service: I recommend that states should establish safe, well-publicised, confidential and accessible mechanisms for children, their representatives and others to report violence against children. All children, including those in care and justice institutions, should be aware of the existence of mechanisms of complaint. Mechanisms such as telephone helplines, through which children can report abuse, speak to a trained counsellor in confidence and ask for support and advice should be established and the creation of other ways of reporting violence through new technologies should be considered."

    The 116 regional short code means children anywhere in Africa can access it reaching a Childline in that country, even further enhancing child protection mechanisms. Forty-five percent of the calls received are a report of a child being sexually abused. Sixty-eight percent of calls received are from or regarding a female child being abused. The Helpline receives a minimum of one call of a child attempting suicide per month. The trained volunteer counsellors operate the Helpline 24 hours per day, 365 days per year.

    Research completed by the child Helpline operating in Canada found that children will call a minimum of 21 times before they disclose and report abuse. Children will call several times to "test" and verify the confidentiality and consistency of the service, building their trust in the helpline to give them the help they need. Childline Zimbabwe does receive "test" calls, however the majority of calls answered involve a report of child abuse, particularly from members of the public.

    The services offered by Childline Zimbabwe are unique within the country, being the only 24-hour service available for children that is an alternative to walking into a police station or a hospital to make a disclosure of suffering abuse.

    Childline Zimbabwe intends to set up a FREE TEXT/SMS service that will increase children's access to the Helpline, in particular meeting the needs of children with disabilities such as hearing impairments. Currently, Childline in Ireland operates a free text/ sms service that has been very successful in receiving calls for help from children who are deaf and other children who do not have the money to make a call.

    The Herald
  • Aside the growing number of private schools in Nigeria that have impacted on the education sector, another initiative that is set to drive the sector further is the introduction of a paperless classroom device christened, All Genius Educator (AGE).

    The system a small mobile platform that can be deployed as a digital classroom will allow students, irrespective of their location, get access to top notch educational contents. According to him, this module is another method of using ICT to advance education in Nigeria

    Unlike online mediums which use internet systems, the CEO of Paperless Homework Nigeria, Panshi Sale said other features of the platform include allowing students in both rural and urban areas to access information. But as in any ICT project the availability of PCs is required.

    Sale said the advantage of using AGE is that it does not require continuous internet and it runs on old computers as well. The system, by virtue of being able to reach out to every school/student with minimal connections and at minimal costs, it is able to cover wide base.

    Panshi Sale further said that in a situation where schools have broadband, not all students have it at home as 'content which has been specially developed for broadband which are very heavy multimedia materials, would only be accessible in schools thereby limiting the access to content'.

    For rural areas where broadband in not available, and where they use dial ups direct land line to access the internet, he said AGE can be downloaded easily through a CD or USB drive. In remote rural areas that have neither communication links nor electricity, the executive officer said low powered Net-books can be advantageous and power will be sourced from Solar panels.

    'With the advent of telecentres being set up by government, students can go to the nearest telecentres to access AGE contents and bring them home to their village through a pen drive which can store as much as 5 years of content.

    For situations like normadic schools that are not stationed in one place, and where there are no nearest electricity or internet (middle of nowhere), he said AGE is the ideal companion and solution to these types of students as they can carry their educational contents with them any where they are going to and still have the same kind of experience. 'AGE contents can be sent to these areas through the use of pen drives. Recommended PCs would be the low powered netbooks using solar panels', he said.

    Vanguard
  • For the street urchins and persons bringing in stolen Laptops and GSM handsets for sale in the Computer Village Ikeja , it may not be business as usual again, as the Police post in the market has intensified efforts to arrest culprits.

    A close monitoring of market activities last week in Lagos showed that Police Criminal investigate Department, (CID) now move round the market, stopping and searching suspects who carry Laptops and Handsets in their bags either for sale or repair.

    The largest African market, the Computer Village, it was learnt, was regarded as the final destination for any stolen GSM handsets or laptops from across the country as a result of market for such products said to be in high demand.

    Just last week, a Police Officers were parading the market in search of suspects. But one of the Police Officers who spoke to Vanguard CyberLIFE on the ground of anonymity disclosed that a good number of suspects have been apprehended over stolen Laptops and GSM handsets.

    "When we apprehend some of these suspects, we usually ask for the receipt of purchase and all details. At the end of the day, some of the suspects will not come back for further interrogation or collect back the product after thorough investigations meaning that the product may have been stolen. We have had many cases here. We have many exhibits here which are usually returned to the head office.

    "We want to make Computer Village the best ICT hub in the West African market. We want to make it a safe place to buy ICT products. We will continue to do this until sanity is restored," he said.

    Although selling of stolen items is not limited to Computer Village alone, the Police Officer further disclosed that some of these Laptops and GSM handsets ranges from new ones, fairly used and refurbished."When you see these suspects carrying items in their bags, you may not know that the products were stolen.

    "But we will continue to do our work to safeguard this market against stolen products. We will do our best. It is a challenge dealing with it. We deal with other cases but we cannot deal with street traders. That is not our mandate but if the Community Development Association or the Computer vendors in the market ask us do that, we will deal with the issue otherwise, it is not our mandate" he said.

    Vanguard
  • - A Cape Town information technology company has designed software that can be used to enhance the experience of reading non-fiction books. The software has "conversational guides" called "cogs", that prompt thinking by asking the user questions designed by people who have read the books or the books' authors. Four universities were running pilot projects using the software, called Cognician, to interact with existing books, said Cognician's chief operations officer Patrick Kayton last week, while demonstrating the software to the Johannesburg media ahead of its launch later this year. The product is web-based and users will buy downloads to use at will.

    - As part of a major Business Reform Agenda aimed at easing doing business in the country, Rwanda Development Board (RDB) last week officially unveiled the online business registration service which will be accessed by prospective investors wherever they may be. The new business registration went live on Friday at the RDB offices and can be accessed on www.org.rdb.rw. The new system provides a single point registration where the RDB clients will have interface with a single agency by filling a single consolidated dossier. The online registration form is then confirmed by a registration certificate and a single identifier (unique identification number) signed by the Registrar General of companies.

    - One Laptop Per Child is giving laptop production and will produce a sub-US$100 tablet with Marvell Technologies.

    - Tea farmers can now track their sales at the trading auction and determine their earnings at the touch of a button -- thanks to a new electronic system at the public sales.The board which tracks the tea trading auction has revolutionalised the industry, eliminating inefficiency associated with the previous open cry auction system.

    - Galaxy Backbone Plc, a public enterprise of the Federal Government has concluded plans to provide a common platform for Internet connectivity and transversal services to all Federal Government Ministries, Department and Agencies (MDAs). The firm is also providing connectivity solutions to enable data acquisition in the 104 unity schools across the country. The connectivity and data acquisition project is aimed at providing cohesive data and tools for the analysis of information that would improve the Nigerian education sector.

Mergers, Acquisitions and Financial Results

  • Safaricom's Sh20.9 billion profit for 2009 has set a new earnings record that has baffled mobile phone users and investment analysts. The country's leading mobile phone company grew its pre-tax profit by 37 per cent, from Sh15.3 billion last year, driven largely by data business, especially its revolutionary M-Pesa money transfer service.

    According to financial results released last week M-Pesa, now three years old in the market, raked in Sh7.5 billion in the period under review, more than double what it earned the previous year. Texting, which many mobile phone users believe is a cheaper way of communicating, earned the company Sh5.1 billion.

    The mobile money transfer service has moved Sh405.5 billion since inception in March 2007, according to company figures. Person-to-person transactions (where virtual cash moves within the system without being withdrawn) for March 2010, the firm noted stood at Sh28.59 billion. M-Pesa has 48 million registered users currently.
    Even the man behind Safaricom's money-machine had to defend the higher-than-expected profit, which makes it the best performing company in East Africa and places it among the top on the continent. "Compared to our peers in the region our profits are very normal," Safaricom CEO Michael Joseph said. "However, locally they appear super because our closest competitors records losses as we register profits."

    Its share at the Nairobi Stock Exchange cheered the results touching Sh5.70 yesterday, from Sh5.40 on Tuesday. "Its performance was above expectations," said Mr Einstein Kihanda, an investment expert at Sanlam Investment. "It's hard to predict the share performance but its diversification into data gives it a long term stability."
    He said there's huge potential in the data business, the latest battlefront for mobile companies, especially browsing on mobile phones and high-speed internet access, technically referred to us broadband.

    "Safaricom is a major player in data," said Kihanda. "It's not just relying on voice for revenue." During the 12-month period, the company's total revenue grew by 19.1 per cent to Sh83.9 billion from the previous Sh70.4 billion. Earnings from data - which includes short message service (SMS), M-Pesa and Broadband services for both mobile and fixed access - expanded 24.5 per cent to Sh15.7 billion.
    As far as earnings go, Safaricom is in a class of its own. The closet company at the

    Nairobi Stock Exchange in terms of earnings is East African Breweries (EABL), which trails at Sh11.9 billion for 2008 verses Safaricom's 15.3 billion. In its half-year ending December 2010, the brewer recorded an 8 per cent drop in pretax profit to Sh6.2 billion. This means even if it earns the same in the second quarter it would make Sh12.4 billion, Sh8 billion less.

    Safaricom was in April ranked among the top 50 companies in Africa as measured by market value, moving from its previous position 55 to 36 this year. EABL came 74, according to the African Business Magazine.

    From a second-rate operator in the early 2000, Safaricom has grown its subscriber base to 15.8 million, 18 per cent growth from last year. This gives it a commanding 78 per cent market share in a market where it has pulverised Zain, its one-time big rival, and the latest entrants, Telkom Kenya and yu.

    Joseph said Sh20 billion invested in the company in the financial year under review had paid off. This money was used in developing its network base that has given growth to its data business. "This is a capital intensive industry and one must be prepared to invest just as much to realise good results," Joseph told reporters and investors at a briefing at the company's headquarters in Nairobi.

    The firm netted Sh2.9 billion from mobile and fixed internet access business that it has lately been promoting aggressively. "There is still a strong demand for data and we are going to do more since the penetration is still low in the segment," said  Joseph, who plans to retire by end of next year.

    While voice market still remains their largest revenue earner, even though its growth slowed, earning Sh63.4 billion from Sh58.7 billion the previous year. This was salvaged by the additional 2.43 million new subscribers but the average revenue per user declined from a previous Sh7.3 to Sh6.

    With a dividend growth of 100 per cent, the firms' shareholders can look forward to 20 cents dividend payout. This will be paid from the Sh8 billion it has declared as dividends for the financial year ended.

    In the 2008 financial year, the company paid out 10 cents with a huge chunk of the local small- scale shareholders accounting for 37 per cent of the shareholder roll, taking home Sh500 or less as dividends. Of the dividend to paid for the concluded financial year, the government of Kenya and Vodafone Kenya are going to be the biggest beneficiaries with a combined shareholding of 75 per cent.

    The East Africa
  • Egyptian cellphone group Orascom revealed yesterday for the first time the price MTN was prepared to pay for its lucrative Algerian unit, Djezzy, even as it confirmed talks with the Algerian government over the same asset. MTN is in takeover talks with Orascom.

    Orascom Telecom's executive chairman, Naguib Sawiris, told Reuters that MTN had offered $7,8bn for Djezzy, the biggest and most profitable unit in its stable. A law passed about two years ago by the Algerian government gives the state first right of refusal on a 51% stake in Djezzy in the event of a sale.

    Sawiris said ylast week that he believed a meeting between the Algerian and Egyptian presidents at a gathering in France this week would improve the atmosphere around the talks. "I hope they (the Algerian government) will negotiate in good faith," he said. Asked about the status of the talks with MTN, widely expected by analysts to exclude Djezzy, Sawiris said: "It's not yet settled, we've been in discussions."

    Djezzy was the main component in a possible broader deal that would have made MTN the world's third-biggest cellphone company if all of Orascom's assets were included. The Algerian veto threw doubt on the chance of a larger deal going through, but talks over the sale of some Orascom assets to MTN have nevertheless continued.

    Last week's confirmation of talks on a deal with the Algerian government has had analysts speculating about MTN's options. This could include MTN being allowed to buy a minority stake in Djezzy and the Algerian government a majority one.

    Business Day
  • Software company Dynamic Technology Holdings said yesterday it had received a R30,2m offer to buy out some of the shareholders in the group from Xantha Properties, which is controlled by some key members of the management.

    The Dynamic Technology board believes the implementation of the scheme is the most efficient manner to unlock value for shareholders and the group by providing interested shareholders with the opportunity to exit their investments.

    "This will afford management the opportunity and resources to focus on operational issues within an unlisted environment without the distraction of regulatory and shareholder matters," it said.

    The company said the trading conditions were not favourable to small companies. "Acquisitions favourable to Dynamic Technology shareholders have been significantly affected by factors such as the persistently low market value of the company and the ongoing negative sentiment associated with small capitalisation companies in general," it said.

    If the offer is approved, Xantha Properties will delist Dynamic Technology. The company employs 140 people and is an owner-managed business, with the shareholders directly involved in the business.

    Business Day
  • Huge Group has reversed its first-half loss of R5.8m, posting a profit of R8.1m for the year to February despite a slight fall in revenue, thanks to a dramatic turnaround in the second half of its financial year.

    The second half is traditionally a slower period for the company, but its focus on improving operational efficiency and generating higher gross profit margins within its largest subsidiary, Huge Telecom, contributed to a spike in profits.

    Group revenue was down to R573.5m from R608.5m last year. Headline earnings per share were up 28.3% to 8.79c. CEO James Herbst said the turnaround was mainly due to a successful merger of TelePassport and CentraCell into Huge Telecom. This resulted in a 35% growth in gross profit in Huge Telecom. The gross profit margin rose to 20.8% from 18.6%.

    This was achieved primarily through significant improvements in the management of Huge Telecom's input costs. The group opened a revenue assurance department to enhance the management of airtime available for sale. This resulted in a dramatic reduction of airtime lost through expiry.

    Gross profit for the traditionally slower second six months of the year amounted to R68.4m, an increase of 34% from the R51m recorded in the first half of the 2010 financial year.

    The group has also diversified its business by launching a media division called Huge Media and by increasing its stake in mobile advertising platform provider Eyeballs Mobile Advertising to 77% from 25%. Contributions from the subsidiaries are expected from this financial year.

    The adding of new revenue streams was also partly done in anticipation of the reduction in interconnection rates, which is expected to substantially reduce the profitability of companies that provide least-cost routing services. However, Mr Herbst said the group was confident it would not suffer as its competitors had because of this reduction in interconnection fees. He said Eyeballs had started generating revenue from sales after the financial year had ended, and he expected Huge Media "to start contributing in future".

    Business Day
  • - The French government has mounted a fresh diplomatic offensive to support a massive claim for Ksh25 billion ($325 million at current rates) lodged by France Telecom with Kenya's Treasury, as Paris raises the stakes in a dispute that could unravel what was the largest privatisation deal in Kenya.

Digital Content

  • Last week, Kenya telecoms company, Safaricom and Equity Bank launched a service, M-Kesho. The service will make it possible for Safaricom's mobile money clients to directly access their Equity bank accounts.

    Safaricom's M-Pesa service has been lauded high and wide, being the first of its kind anywhere, and since its inception almost four years ago has roped in 9.5 million clients.

    This is significant because now M-Pesa subscribers total more than all bank account holders in Kenya, making Safaricom a major player in the financial industry.

    Coming together with Equity Bank is arguably a game changing move, because the bank in its own right, is the biggest bank in Kenya by number of account holders.To understand the full implication of this development we need to understand how M-Pesa works.

    Just like similar mobile money transfer services in Uganda, a subscriber would walk over to an M-Pesa agent and deposit money on his phone. The subscriber would then be able to send this money to another mobile phone owner or buy goods from selected agents.
    With M-Kesho the need to go to the agent will be removed. Dealing with the mobile phone one can now transfer money from their bank account directly to the intended recipient.

    Beyond money transferring M-Kesho will provide interest bearing accounts, issue credit and write life insurance.The immediate implication of this is that Safaricom's 15 million subscribers now have bank accounts, with all the attendant benefits that come with it.
    Up to this point most Kenyan bank account holders were urban dwellers, with Safaricom's extensive rural network hundreds of thousands of Kenyans will have easier access to financial services.

    The benefits of joining the formal financial sector can not be underestimated for individual or country. We need not look far back into history to find a time when having a bank account was a privilege and a thing of pride. Banks erected barriers to account holding with prohibitive account opening requirements, high minimum balances and unrealistic loan requirements.

    With technological advancement and increased competition thousands more Ugandans now have bank accounts and access to credit is more widespread. The numbers do not lie.

    Since 2000 after our own banking crisis, savings and loans in the banking sector have jumped more than five times to sh4,256b and sh4,083b respectively as at the end of February. The benefits are there for all to see with the real estate development boom, businesses opening at every street corner and the collapse of the road system under the weight of the thousands on new cars making their way onto our roads annually. But this only happens in Kampala.

    By merging financial services and telecommunications, the barriers to entry into the formal financial sector will be further lowered and it is expected that the ensuing benefits will be much better spread around the country. The advancement of individual players inevitably feeds into the national economy.

    In the most important way that I can think of, with more players entering the formal economy more of our little monies will be aggregated into meaningful sums that can drive meaningful change.

    One of the biggest challenges of development is to drive up savings rates. Savings fuel investment, which in turn grow economies and raise incomes and wealth. So far Uganda is doing badly, with its savings rates far below regional averages making us reliant on moody donors to finance our crucial investments in infrastructure.

    New Vision
  • Internet and data services are the new forces behind Orange's penetration into the Ugandan market. This informs the firm's strategy as it strives for market dominance amid raging price competition.

    MTN Uganda boasts of the largest subscriber base estimated at 5.6 million, an achievement anchored on a low pricing penetration strategy, wide network coverage and attractive user services like MTN Mobile Money transfer.

    Zain Uganda comes second with more than two million subscribers after a turnaround strategy driven by sharp discounts on calling rates and improved network quality.UTL has registered about two million subscribers on the back of sharp price discounts. Its favourite packages include UTL Jazz and UTL Extra that provides one of the lowest off net calling rates in the market. Calls under the latter profile are charged at Ush320($0.15) for the first and second minutes while the rest are charged Ush270 ($0.12) each.

    Orange's approach is driven by its 3G network that boasts high Internet connectivity speeds backed by solid fibre optic links, minimal interruptions and relatively cheap offers. Its bandwidth for instance, goes for Ush0.9 per KB, the lowest charge in the local market.

    Experts also argue that the use of dedicated bandwith packages that are strictly allocated to individual users as opposed to shared bandwidth packages offered elsewhere has strongly boosted growth in the Internet and data services segment.

    According to the chief executive Phillipe Luxcey, the firm has recorded a remarkable growth with its highly discounted local and international calling tariffs in the midst of widespread discounts by bigger players. "Our focus is on a multimedia service that offers high quality voice calls, fast Internet speeds and information services," said Mr Luxcey.

    Orange Uganda commenced operations in March becoming the country's fifth mobile operator after Zain Uganda, MTN, Uganda Telecom Ltd (UTL) and Warid Telecom. Orange's minimum Internet access offer comes with a modem priced at $102 for 1 GB capacity with a monthly fee of $25. Prior to Orange's entry, many consumers complained of low connectivity speeds and high user fees.

    In contrast, Orange's low-priced, high speed Internet packages have attracted several users keen on downloading heavy pictures, videos and playing music for long intervals. So far, Orange has registered 10,000 mobile Internet subscribers since the product launch and boasts of total installed capacity of 600MB that can be doubled.

    In addition, fibre capacity has been increased six-fold to accommodate customer growth but only 20 percent of international Internet capacity has been utilised, with the rest being sold to local Internet service providers, according to Luxcey.

    But analysts believe Orange Internet's biggest undoing lies in limited network coverage though it boasts 450 live sites spread across the country. Orange has managed to get only 500,000 out of available nine million subscribers in the voice segment. This is partly due to its lucrative local and international calling tariffs and quality voice reception. Currently, it charges as little as Ush200 ($0.09) for on net calls.

Telecoms, Rates, Offers and Coverage

  • - Cell C last week announced its roaming partnership with Zain which will benefit both Zain and Cell C subscribers. The ‘One Network’ borderless mobile phone platform enables pre-paid and post-paid Zain customers to be treated as Cell C customers when they roam on the South African Cell C network. The partnership between Zain and Cell C means that Zain customers will pay relatively low rates (compared to traditional roaming rates) on the Cell C network.

    - The most popular mobile handset in Kenya is the Nokia 5130, a report shows. The report tracks market penetration of Opera Mini, a mobile client. It includes information such as the fact that Opera Mini users doubled between November 2008 and November 2009. Nokia 3110c was the second most popular handset followed by Nokia 2600c.The only Samsung model that is used by most Kenyans in the top ten list was the Samsung SGH-E250, coming in fourth.

    - Good news for South African consumers is that the cost of in-flight broadband in South Africa will be competitive in terms of international standards.The pricing will remain in the bracket of between R0.50 and R0.80 per MB for G-Connect (WirelessG’s prepaid Internet service) account holders. The service will be fully converged with the standard G-Connect 3G, Wi-Fi and ADSL on a single account.

    - MTN Uganda's MobileMoney has registered 890,000 users in its first year of operation. This is 16% of the operator's total subscriber base, and it expects this to grow to more than two million by year-end.

    - The cost of mobile phone banking and the internet (e-banking) in Uganda is set to drop after Bank of Africa, unveiled a low-cost electronic banking services in the market.The bank has raised stakes for other banks offering mobile and internet banking by lowering the fees paid by individuals to execute transactions on their accounts via mobile phone Short Message Services (SMS). Instead of charging Shs500 per mobile phone transaction like other players in the market, the bank is charging a flat rate of Sh2,500 for 15 SMS and Shs10,000 for 40 SMS. With an increase in the use of mobile phones and internet in Uganda, commercial banks are now enabling clients access their account balances, make cash transfers between bank accounts, and execute payments by way of SMS and websites.

    - According to Bloomberg, Millicom International Cellular SA, a company with mobile-phone customers across Africa, plans to counter Bharti Airtel Ltd.’s Africa entry with services such as money transfers, banking and insurance. “I don’t think Bharti is proven outside of India, so let’s see what they bring,” Chief Executive Officer Mikael Grahne said in an interview in Stockholm. “We just need to accelerate and come out with new things.” Millicom was interested in some of Zain’s Africa assets that Bharti agreed to acquire for $10.7 billion in March, he said.

More

  • - Cina Lawson  has been appointed as the new Minister of Post and Telecommunications of Togo.

    - Polycom has appointed Keith Carter as the telepresence company's vice-president for channel partners in Europe, the Middle East and Africa (EMEA).

    - ITWeb recently reported that Parliament and Communications Minister Siphiwe Nyanda has agreed on four new Independent Communications Authority of SA (ICASA) councilors. They are: William Currie - Communication and Information Policy Programme Manager for Association for Progressive Communication; Joseph Lebooa - Business Liaison Manager with MTN; Ntombela Ndhlovu - GM Stakeholder Management-Corporate Affairs at SABC; andStephen Mncube - Chairman of Tasima.

    - O3b Networks has announced the appointment of Christian Patouraux as Chief Product Development Officer. Until 2009, Patouraux, 40, was Managing Director of OghmaMedia, a wireless media company based in Singapore which he founded. OghmaMedia established and operated a vast network of wireless access points and served the advertising industry. Mr. Patouraux also founded and headed a consultancy practice in Singapore, focused on providing strategic planning, market insight and sales support to clients in the Satellite industry. Previously, he worked for 8 years at SES in Luxembourg and the USA, where he held various responsibilities in Satellite operations development and Satellite procurement and manufacturing. Most recently, he was a Managing Partner based in Sydney, Australia for SoftVenture, a fast growing investment and business performance consulting firm.

  • WEST AND CENTRAL AFRICA COM
    16-17 June 2010, Le Meridien, Dakar, Senegal
    Following 2 incredible years in Nigeria, West & Central Africa's ONLY dedicated event telco returns to Senegal. 
    Join 700+ decision makers and a panel of 50+ visionary speakers including 25 CEO level operators for a pre-event seminar on Fibre Optics, a 2 day strategic conference and 50+ stand exhibition.
    Gain all the contacts, insights and ideas you will need for your operations in the region.
    For further information visit Informa's website

    COMMON RESPONSES TO A GLOBAL CHALLENGE
    17-18 June 2010, BIS Conference Centre, London, UK
    With the critical information infrastructure of Estonia coming under attack in 2007, the focus of Cyber security was elevated from an individual perspective to a National perspective. Importantly this incident highlighted the need for developing countries to implement robust and effective Cybersecurity frameworks, without which the entire Cyber World will be at risk.

    Continuing with the work carried out by the Global ICT stakeholder community, most notably ICANN and ITU, the CTO’s Cybersecurity Conference aims to:

    Create awareness of the many facets of cyber threats and alert stakeholders of the need to adopt robust Cybersecurity frameworks
    Build capacity of the key decision makers in developing countries to implement strategies aimed at preventing and responding to the growing menace of Cyber threats
    Provide the key decision makers with the means to adopt resilient technical measures, establish appropriate organisational structures and create robust legal/regulatory frameworks
    Promote international cooperation in Cybersecurity to help developing countries to leverage the strengths of developed countries 
    Broker partnerships between the different players in Cybersecurity to facilitate the flow of information, expertise and resources 
    For further information visit the CTO's website

    CAPACITY AFRICA 2010
    21-22 September 2010, Nairobi, Kenya
    The most comprehensive African wholesale telecoms conference bringing together local and regional fixed-line and mobile operators from across the continent
    For further information visit Capacity Media's website

  • Ahead of the launch of commercial services of its Glo 1 Submarine Cable, Globacom Limited has invited applications from bright, ambitious and suitably qualified candidates to fill an array of vacancies, including those of Chief Technical Officer, Planning and Provisioning Engineers, Sales and Legal Officers.
    A statement from the company said the advertised positions attract internationally competitive remuneration packages. According to Globacom's Executive Director for Human Resources, Adewale Sangowawa, the company is looking for first-class brains and competent hands from across Nigeria, other African countries as well as from America, Europe and Asia. "As an equal opportunity employer, our corporate policy stretches across all races, countries and genders.

  • MainOne and Huawei - Nigeria
    Operators of MainOne submarine cable have entered a deal with Huawei Nigeria to provide it with the Intelligence Optical Switching System (OptiX OSN 9500) for connectivity.

    IDECO and SA Government – South Africa
    IDECO has been appointed as a subcontractor to supply biometric components and systems to several suppliers contracted by the government for various projects. The company, which sells fingerprint-controlled access and monitoring systems, said it was also awaiting the adjudication of other tenders for biometric readers. The criminal record-checking service, conducted by Ideco AFISwitch, was expected to continue to show strong growth. The company said the agreement concluded this month for the management of more than 300 000 identity profiles was in the implementation phase and would be completed early next year. Ideco achieved an operating profit of R3.7m in the six months ended February, compared to a loss of R4.8m for the comparable period a year ago. This was a turnaround of R8.5m compared to the first six months, and R18.5m compared to the financial year ended August.

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