MERGERS, ACQUISITIONS AND FINANCIAL RESULTS
Tanzania: Sh150 Billion Deal Reached to Build ICT Backbone
The government and three mobile phone companies will jointly construct an information communication technology broadband backbone in major urban areas of Tanzania.The project is expected to cost $80-100 million (between Sh120 billion Sh145 billion) and will be undertaken in Dar es Salaam, Dodoma, Mwanza, Arusha and Mbeya.
The government partnership with Airtel, Zantel and Tigo is intended to bring connectivity close to urban dwellers. Since last year, the laying of the national ICT broadband backbone has been carried out in areas other than urban centres.
The director for Information and Communications Technologies at the ministry of Communications, Science and Technology, Dr Zaipuna Yonah, told BusinessWeek recently that upon completing the work, the three firms would be given a right to use enough fibres for a certain period before the project is handed over to the government.
Meanwhile, the construction of a national ICT backbone has entered into the last phase and only two regions --Rukwa and Kigoma--are yet to be reached.
The backbone, which is the terrestrial continuation of the fibre optic submarine cables that landed on the Dar es Salaam coast in 2009, has contributed to a drop in Internet capacity charges. However, analysts see the connectivity charges as still high taking into account the tremendous development seen in the ICT industry in the country.
The project was started in 2008 and is expected to cost about Sh251 billion when it is completed at the end of this year.The government intends to turn the country into a regional ICT hub. According to the Tanzania Communications Regulatory Authority, the broadband subscriptions stood at four million by the end of 2009.
The construction of the backbone was divided into two phases. Phase one became operational in July 2010 and covered the northern ring of the network with ten points of presence (POPs), which included Dar es Salaam, Morogoro, Singida, Iringa, Babati, Arusha, Namanga, Moshi and Tanga.
Phase Two is expected to be completed by December 2011 with operational PoPs at Lindi, Mtwara, Tunduru, Songea, Sumbawanga, Tabora, Kigoma and Manyovu.
The project is funded by a $170 million soft loan from China and Sh30 billion from government sources. However, the government should improve an environment for public and private institutions to deliver services using ICT.
According to the deputy-managing director of the University of Dar es Salaam Computing Centre, Dr Respickius Casmir, the government should swiftly design arrangement for the country to tap socioeconomic benefits such as a knowledgeable society using the infrastructure.
Since Phase One of the backbone became operational last July four major locally licensed cellular and data operators were subscribed to services of the national information communication and technology broadband backbone (NICTBB), with other two companies from Malawi and Zambia getting access to NICTBB through licensed local operators.