Issue no 564 22nd July 2011

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Top story

  • Liberia, one of the poorest countries in Africa has joined in the race to register its mobile users. The process was officially launched on July 18th by the Liberia Telecommunications Authority (LTA), the local telecoms regulator. The deadline for the completion of the registration process has been set to 90 days from the start day, a very short period to register about 1.6 million mobile subscribers. Isabelle Gross spoke to Avishai Marziano, the CEO of Cellcom, one of the four mobile operators active in Liberia about their initiative to launch a “paperless” registration process and what SIM registration entails for a mobile operator.

    Four months ago, LTA started talking about launching the SIM registration process which would run according the telecoms regulator in parallel to the introduction of a new numbering plan for the country. In other words, LTA was of the view that it could “kill two birds with one stone”. For Avishai Marziano, the CEO of Cellcom the preparation period was a bit thigh but they started to work on it straight away in terms of preparing the information required, drafting the registration form and developing the IT front and backend that will support the registration process all along. Cellcom’s driving idea was to make the registration process fast and as paperless as possible. With these aims in mind they developed a mobile applications running on Windows7 to capture the mobile users details including the option to capture the user’s photo and valid ID card via the mobile device’s camera. All the data captured are then send to a backend server and encrypted to ensure that mobile users’ data are kept confidential. According to Avishai, the mobile application enables to capture all the data including the details of the proxy person when required and it takes less than 5 minutes to complete the registration process. He hopes that this will greatly help to catch the mobile user’s details on the spot.

    To meet the 90 days deadline, Avishai reckons that the mobile operator will need to register between 3,000 and 4,000 mobile subscribers per day. This will not be too difficult in Monrovia, the capital city but going up in the country in rural areas will present more challenges because of the bad state of the roads and the raining season not yet over. In Liberia, the mobile operators also start the registration process with a blank sheet where us in African countries where mobile payment services have already been launched by mobile operators, they will already have details on their subscribers because of the KYC (Know Your Customer) banking requirements. It is easy to see that from a mobile operator’s perspective the SIM registration process is a CAPEX and OPEX intensive task and because of the short notice period given by LTA to roll out the process, mobile operators had not really factored in these expenses in their budget. However, Cellcom plans to have between 200 and 300 registration points with additional labour costs estimated between US$50,000 and US$75, 000 per month. This also means that the company’s size is going to double over a short period of time and according to Avishai, you need to make sure that the company and the people are prepared and ready for this.

    Looking on the bright side of things, Avishai is convinced that the registration process is also a good opportunity for the mobile operator to acquire new customers. The registration agents have been tasked to go towards the customers in various places like the university or the army cantonments to register mobile users and recruit new customers. He also thinks that the registration of mobile users will help to develop a mobile user directory and also serves as a platform to develop other services like mobile payments services or micro-finance projects.

    Besides putting in place all the front and backend to support the registration process, Liberia’s mobile operators are also left with the task of explaining the registration process to the mobile users. According to Avishai, things are going well so far and customers have shown more confidence towards the electronic registration rather then filling in a paper form. Mobile users seem to entrust more mobile operators than a public administration that their personal data are protected and safe with them. Although the regulation on the SIM registration issued by LTA specified that the telecom regulator will keep the mobile users data in a Central Subscribers Database under its care, control and management, the current situation is that mobile operators will register and keep their subscribers data and only disclose individual details upon a request from LTA. This might actually not be such a bad thing considering what is happening in South Africa where a national audit of the mobile subscribers database has been recently ordered by the government in move to understand the extent of the illegitimate entries.


    Video clips that might interest you on Balancing Act’s Web TV channel

    IsisNyong'o, MD Africa, InMobi on mobile advertising in Africa

    En francais: Karim Sy, Jokko Labs, Dakar

    Arthur Goldstuck, CEO, WorldWideWorx on the mobile Internet in South Africa

    Mikul Shah, Managng Director, Eat Out on expanding into East Africa

    David Afugani, Chief Marketing Officer, RLG on its Made in Ghana mobile handsets

    Francis Ebuehi, Country Manager, Dealfish West Africa on the its online classifieds site


  • Ahead of the UN Climate Change Conference (COP-17) in Durban, South Africa, participants at the International Telecommunication Union (ITU) Symposium on ICTs and Climate Change in Ghana have renewed calls for global leaders to recognise the power of information and communication technologies (ICTs) to mitigate and adapt to the effects of climate change.

    The communiqué issued at the end of the meeting has urged ITU to lead a coalition urging COP-17 delegates to look to the enormous potential of ICT solutions to cut emissions across all sectors. The document also called for the adoption of a 'closed loop' approach to manufacturing and recycling which would reduce the need to extract and process raw materials. It also asks for recognition of the value of ICTs in monitoring deforestation, crop patterns and other environmental phenomena.

    The ITU's secretary-general, Dr Hamadoun Touré, however, stressed ITU's commitment to providing the technical know-how to mitigate and adapt to climate change. "It is now clear to most observers that ICTs have a very important role to play here. Recognition of this at the international level will provide countries with a solid argument to roll out climate change strategies with a strong ICT element," he said.

    Speaking at the opening of the Ghana symposium, Malcolm Johnson, director of ITU's Telecommunication Standardisation Bureau (TSB), said: "Today, a world without ICTs is unthinkable. ICTs are integrated into almost all parts of our society and economy. Yet, while the increasingly widespread use of ICTs has changed people's lives dramatically and boosted economic growth, the success of technology means it is itself a growing contributor to greenhouse gas emissions. On the other hand, ICTs probably provide the most significant opportunity to reduce greenhouse gas emissions in the major high emissions industries of energy generation, waste disposal, building and transport. This is a message we must carry to COP-17."

    During the event, ITU launched a project on ICTs and climate change in Ghana which would be based on two pillars. The first would look at how ICTs could be used to help Ghana adapt to the effects of climate change, and would be led by the ministry of communications and sponsored by Research in Motion (RIM).

    The second, which would be led by Ghana's Environment Protection Agency (EPA) with sponsorship from Vodafone Ghana, would look at how telecommunications in Ghana could reduce their own greenhouse gas emissions (GHGs). This project would pilot, for the first time, the ITU methodology on environmental assessment for the ICT sector.
    The Ghana event was the sixth ITU symposium on ICTs, the environment and climate change, following successful events in Kyoto, London, Quito, Seoul and Cairo, beginning in 2008. It was the first to address the broader issue of sustainable development, identifying a number of possible recommendations from the ICT sector that could be presented to the 2012 United Nations Conference on Sustainable Development.

  • Niger's communications ministry said it wanted to establish a 3G mobile phone network and was inviting firms to apply for the landlocked west African country's first two licences.

    "These licences can go to any operator who desires them," according to a statement on state TV overnight. "Operators already set up here and who have global licences also have a chance to acquire one."

    Bharti Airtel , Atlantique Telecom's Moov, France Telecom's Orange, and state-owned SahelCom are the main telecoms operators in Niger, and all have benefited from a surge in mobile phone use in recent years.

    Orange currently offers a Blackberry service, but no operator offers the high speed data services associated with 3G.

    While Niger's 16 million inhabitants share just 20,000 fixed lines, mobile phone use is estimated at around 2.5 million.

    Last month, Niger revoked a deal to sell Libya's LAP Green Network a majority stake in national telecoms operator Sonitel and its mobile arm, saying the firm had not respected terms of the transaction.

  • The National Communications Authority (NCA) has announced that at the end of the tenth full day of Mobile Number Portability (MNP) in Ghana -5,631 subscribers had successfully moved from one mobile service provider to another while retaining their mobile number.

    According to the statement, NCA's analysis of the data for these first ten days shows that of the porting requests completed: 12% were completed in 15 minutes or less; 22% were completed in 30 minutes or less; 36% were completed in 1 hour or less; 72% were completed in 4 hours or less; 14% completed between 4 and 12 hours; 13% completed between 12 and 24 hours; and less than 1% were completed in more than 24 hours.

    The fastest port recorded so far in Ghana took place in a mere 1 minute, 31 seconds. The average porting time for the first ten days was 4 hours, 17 minutes, it added.

    The statement emphasised that: "This performance compares very favorably with recent MNP implementations in other countries, such as India, where porting a mobile number can take up to seven days, and Kenya, where it can take up to 48 hours.

    "Even in Europe, porting can take considerably longer than it does in Ghana. Spain has just announced its intention to reduce porting times next year from the current four days to one".

    During this full scale nation-wide launch, a number of challenges have arisen. Some porting applications which could not be submitted because no validation text message was received; the causes are under investigation.

    In other cases the customer's original service provider declined to authorise the porting request, usually because the customer had not been with that network for the minimum 30 days required. Many of the several cases in which a request was incorrectly declined have already been resolved.

    Ghana mobile phone subscribers are reminded that when they sign the porting request form and send the validation text message, they are moving their number from their current mobile service provider to a new one.

    They are closing their account at the old network, and when the porting is completed, they will no longer be using the old SIM. It appears that in some cases, the customer did not clearly understand this, and believed they were receiving an additional number.

  • The Abuja office of telecommunication giant, Globacom has been sealed up by the Nigerian Communications Commission [NCC]. It was said that the seal off was necessitated by Globacom's non compliance with telecom guidelines as ordered by the Nigeria Communication Commission.

    The NCC officials declared that two letters had been written to Globacom authorities over the company's non compliance with the directive on the ban of sale of activated GSM sim cards to subscribers and the non-compliance with the guidelines on installations of masts and towers.

    Recently, the Nigerian Communications Commission had slammed a N5million fine on the telecommunication giant for failing to comply with the ban on sale of fully activated new SIM cards and guidelines on technical specification for installation of masts and towers.

    NCC compliance and monitoring team said it received reports from several locations in the country indicated that most of the SIM cards sold by Globacom were already fully activated, a situation which NCC forbids.

    After several correspondences conveying the findings to Globacom and a directive to fully comply by 17 February, NCC alleged that the company failed to comply.
    The Commission said that further compliance monitoring indicated that Globacom Ltd was, no doubt, in contravention of the directive on the ban on sales of fully activated SIM cards in Anambra, Borno, Kano, Katsina and Plateau states as Globacom SIM cards purchased in April 2011 in these states were fully activated as calls were made unrestricted from the new SIM cards.


  • The government is set to renegotiate the management contract of state-owned inland fibre optic network in what could see Telkom Kenya lose annual fees of Sh250 million.

    The Information ministry is considering reducing the cost of accessing the fibre network-- National Optic Fibre Backbone Infrastructure (NOFBI)—from the current $12 (Sh1,050) per kilometre to speed up penetration in rural areas.

    The management contract was signed last July giving Telkom Kenya the right to run NOFBI on behalf of government and sell capacity to other operators such as Safaricom, Access Kenya and Wananchi Group.

    But the state feels Telkom Kenya has not been aggressive in selling capacity to its rivals, further arguing that Sh250 million management fees is on the higher side given the unused capacity on the inland fibre.  

    “Telkom Kenya has not been strong enough to handle this infrastructure as a business so far, thus slowing the uptake of internet in the country” said a senior government official, adding that the government is planning to offer the contract to a neutral firm.

    Apart from Telkom Kenya, the only other operator said to be utilising NOFBI is Safaricom.

    The Sh5 billion inland fibre network was funded by the Communication Commission of Kenya (CCK), which also negotiated the contract to have Telkom Kenya run the infrastructure.

    France Telecom bought a 51 per cent stake in Telkom Kenya in December 2007, with the remaining shares still being held by the government.

    The firm was offered the contract on the strength of the government shareholding and the fact that the access points to the network were installed in premises owned by Telkom Kenya   

    A decision on the pricing and the management contract is expected to be reached at a meeting convened by the Information ministry and attended by sector players.

    Telkom Kenya has sent the government the Sh250 million invoices for the year to June and reversal of the deal will hurt the firm’s earnings, especially now that vicious price wars in Kenya’s data and mobile telephony market have eroded operators’ revenues.

    When contacted the firm declined to comment on this story: “I cannot comment on the matter, the ministry is better placed on this,” Michael Ghossein, the chief executive of Telkom Kenya told the Business Daily.

    Sources in government say they prefer a model where Telkom Kenya continues running the network but receives a commission from the revenues generated through leasing NOFBI to other operators.

    Though operators such as Jamii Telkom and Access Kenya have laid cables in Kenya’s urban centres, they lack the link that connects the centres to each other, offering the state-owned infrastructure a competitive edge. Kenya Power has also pitted itself as a rival to NOFBI through its vast power network that now hosts fibre lines.   

    Telkom Kenya faces a new hurdle in determining a pricing structure that will tap more operators to use the inland fibre optic cable 

    “Jamii cannot access the national optic fibre because Telkom Kenya has not finalised with the ministry,” said Joshua Chekwony, the chairman Jamii Telecoms Ltd, “In a letter to us, Telkom said that the price is determined by the ministry, which is yet to finalise on the new arrangement.”  

    The move to renegotiate the contract is part of the government plan to lower internet costs, especially after connecting the country to the undersea cable that was expected to substantially cut prices—and lift penetration, especially to rural areas.

    The wholesale prices on international fibre optic cables have come down to Sh32, 580 ($400) from Sh366, 524 ($4,500) previously charged by Seacom, Teams and Eassy.

    But the government says that cost should drop by half and is urging the operators to share infrastructure to boost internet connection.

  • New player Brodacom has launched Zimbabwe’s first 4G internet service, promising to bring the Southern African nation’s economy into the digital age.

    The company, one of Zimbabwe’s 15 licensed IAPs, launched its product by running adverts boldly asking customers the question: What do you expect from your 4G network?

    “We are coming into the market with voice, data and video services. We are able to provide voice services at home and office and on mobile platforms. We do not sell handsets, but our modems have the capacity and capability to provide voice services, sms, data and internet services. They support those kind of services whether its fixed telephony or mobile services,” the managing director of Brodacom, Parkvoo Mutendera told Biztechafrica.

    “Most of our products are designed to make broadband accessible to more than just an individual so you buy one gadget and you give internet access to 10 or 20 other people and this is what is going to make the difference between what we are offering and what has been available on the market," he said.

    “Because we have a very visual generation now we have gone into the video space where we are saying individuals can interface via video. We are putting up base stations so that such services can be accessible even in remote locations and even the media can broadcast live on internet using the backbone of our infrastructure. We cut across voice, sms, data and video,” Mutendera said.

  • Nearly a year now, flow through KIXP run by the Telecommunications Service Providers Association of Kenya (Tespok) grew from about 250 Mbps (megabits per second) to reach 1Gbps last week. An Internet Exchange Point (IXP) is an interconnection of Internet Service Providers (ISP) networks at a certain location where they exchange traffic between one another, a process defined as peering. Kenya already has two IXPs, one in Nairobi and the other in Mombasa.

    "This afternoon the KIXP reached its highest peak of 1Gbps for local traffic exchanged," Mr Michuki Mwangi, KIXP technical manager said last Friday through a local mailing list KICTANET, "It's indeed a significant achievement and the next ceiling is 10Gbps."
    Tespok chief executive Fiona Asonga attributed the growth to increased traffic from operators in Kenya and the region such Uganda, Tanzania, Rwanda, Mozambique, Malawi, Zambia and many others that now have interconnection partnerships.
    She said since search engine giant Google launched the global caching server locally, content meant for the Kenyan market has grown highly.

    "Indeed majority of the traffic is Google. According to Arbor Networks Google accounts for six per cent of all Internet traffic, which means it accounts for majority of the traffic at most IXPs considering they are the only content delivery network (CDN) at KIXP," said Mr Michuki. "It's a sign that our local data consumption is growing and broadband is improving since that's the largest use of the Google cache." "We have seen growing number of companies exchange their traffic locally," said Ms Fiona. "The traffic could even be more if organisations host their content in Kenya." In comparison, other exchanges such as that in Johannesburg handles 1.2Gbps while the Amsterdam IXP handles 950 Gbps as per last year estimates.

    When first launched about nine years ago, KIXP used 64 kbps (kilobits per second) which had to be immediately doubled to 128 kbps and then again to 256 kbps due to demand. It still ranks amongst the world top 15 IXPs in terms of traffic growth.
    The establishment of critical infrastructure such as national Internet Exchange Points has provided additional cost savings to operators by diverting the local traffic away from the more expensive international links to a local connection.

    With all these investments, Internet costs are still high and most cross-border traffic exchange is done in Europe and North America. For example to send an email from Nairobi to Kigali, it has to be routed to Europe then back to Kigali. The anomaly is that Rwanda is a landlocked country, and has its international fibre connectivity terrestrially connected via Uganda and Kenyan coast of Mombasa.

    The scenario is replicated across the entire region and serves as a barrier to growth, innovation and operational efficiency. Of most concern is that cross-border and regional communications are entirely dependent on global connectivity. Lack of network interconnections between many countries in Africa, especially those in the interior, means that data traffic destined for neighbouring countries is often shipped overseas, just to return back to Africa. In some countries that have physical connections to undersea cables, much traffic still flows through inefficient routes. The region has in the recent past seen increased infrastructure investments. In Kenya, the landing of three cables the - the East Africa Marine System, (TEAMS), Seacom and EASSy - which are live, has ensured optimal connectivity. These investments create an opportunity for much higher levels of local and regional interconnection.


  • The Minister of Communication Harruna Iddrisu has defended the withdrawal of the Data Protection Bill from the House of Parliament.

    The Minister explained that during a meeting with the joint committee, the Attorney General and Minister for Justice and other stakeholders over the Bill, specific challenges had arisen.

    He said withdrawing the Bill would enable the ministry effect the necessary corrections after which it will be re-laid in the House. The Bill was first laid in the House by the Minister on November 29, 2010 and referred to the joint committee on Communications and Constitutional Legal and Parliamentary Affairs for consideration and report.

    The joint Committee presented its report on March 23, 2010. The House was scheduled to have begun considering the document last week but just before they settle down to begin the sector Minister came in with the withdrawal notice in accordance with section 132 of the House standing orders.

    The Bill aims to provide for the protection the privacy through the regulation of the processing of information related to individuals including the process by which the information is obtain, held, used or disclosed and to provide for related matters. It also sought to set out the rights and responsibilities of data controllers, data processors and data subjects in relation to personal data. It was also to deal with personal data which relates to data subjects.

    Recognising that every Ghanaian has the right to privacy with respect to the processing of personal data, the Bill will activate or give meaning to Article 18(2) of the 1992 constitution. In essence, the absence of legislation on this matter is an infringement to the right to privacy, a memorandum to the bill stated.

    The Bill provide for data protection principles and enjoins a person who processes data to take into account and give effect to the data protection principles which include accountability, lawfulness of processing, specification of purpose to be compatible with the purpose of collection.

    It states that a person is not to process personal data unless the consent of the data subject is obtained, the purpose for which the personal data is processed is necessary for contractual purpose, and the purpose for the processing is authorized and is to protect a legitimate interest of the data subject.

  • Government agencies will now be able to hold meetings without necessarily leaving their offices. Thanks to the new technology called Secure Messaging and Collaboration system that was launched yesterday.

    The new system will for instance enable several ministries to hold discussions through video-conferencing, a move likely to cut on time wasted in holding workshops at specified places. The system being piloted at the National Information Technology Authority -Uganda (NITA-U), is to be rolled out to the Ministry of Information and Communication Technology (ICT) and State House in September.

    Dr Ruhakana Rugunda, the ICT Minister, launched the system including incorporated end-to-end secure email, instant messaging, voice and video-conferencing.

    Dr Rugunda said the technology should be used to make government services more efficient, bring information closer to the people and create employment. "I am happy to be associated with this crop of young and energetic professionals recruited at NITA-U who are expected to be leaders of the ICT revolution in Uganda," he said, adding that many more jobs will be created.

  • In a bid to stem the large scale fraud associated with the distribution of petroleum products from the major depots to the hinterlands nationwide, the Federal Government commenced the electronic tracking and monitoring of distribution trucks.

    About N15 billion is paid annually to petroleum products transporters, for distributing products nationwide, which is billed into every litre of product purchased by consumers.

    The e-monitoring, code-named, Project Aquila, is the initiative of the Petroleum Equalisation Fund (Management) Board , which is responsible for paying petroleum truck drivers the cost of delivery or bridging from one destination to another.

    The project kicked-off with about 2,000 registered petroleum trucks, beginning with test trials from the Conoil Plc Depot in Apapa, Lagos, until October 4, when the project will be fully streamed nationwide.

    At the kick-off of the project, Executive Secretary, PEF, Mrs. Adefunke Sharon Kasali, said Aquila would eliminate fraudulent practices arising from fictitious claims, products diversion, and ultimately, scarcity associated with delays in the payment of bridging claims by oil marketers and transporters in the downstream petroleum sector.

    "In the past 12 months, PEF(M)F has been able to detect and stop the payment of more than N400 million worth of fictitious claims," Kasali said, adding: "With Project Aquila, the presentation of fake meter tickets to the board will be significantly reduced if not totally eliminated."

    The beauty of the new system, which she explained had undergoing fine-tuning for the past three years, is that claims can be paid within two weeks of the submission of application.

    The PEF scribe also noted that the new system, the first of its kind that will confirm the delivery of petroleum products in Nigeria, is almost tamper or hacking proof, as the software is based on RFID technology, which experts say is "one of the most effective technologies in use for such transactions."

Mergers, Acquisitions and Financial Results

  • Millicom International has reported that its second-quarter revenues rose by 14.6% to US$1.12 billion, boosted slightly by currency fluctuations. Revenues were up 20.7% excluding the impact of the full consolidation of Honduras a year ago. Net profit jumped to US$175 million from US$134 million a year ago, while EBTDA was up 10.6 % to $513 million The subscriber base rose by 12% versus Q2 10, bringing total customers to 41.3 million.

    In Africa, revenues were up 12% year on year in local currency. The company has experienced more stable pricing activity in its African markets in H1 2011 compared with H2 2010 and it remain focused on maintaining the affordability of Tigo products and services across the region, whilst defending its margins.

    Customers in Africa increased 17.2% year-on-year bringing the total at the end of June to 16.6 million. The net intake for the quarter was over 1 million. The highest intake of almost 270 thousand customers was recorded in Tanzania. In Rwanda we added 243 thousand customers bringing the total at the end of June close to 813 thousand. Although the customer registration deadline passed in May in Chad, requiring the disconnection of unregistered customers, we still added 132 thousand net new customers. In Ghana the customer registration deadline was extended from June 30th to September 30th and we added almost 125 thousand customers in the quarter.

    Revenues in Africa were up 12.3% year-on-year to $246 million, with local currency revenues up 11.9%. For the region as a whole we have seen more stable pricing activity in the first half of 2011 compared with the second half of 2010 but we have not seen any real evidence of elasticity following last year‟s cross-net tariff reductions. We continue to maintain the affordability of Tigo products and services across Africa but our prime areas of focus are growth, cost management and returns, rather than pricing. VAS revenues increased by 34.1% year-on-year and now account for 10.5% of the region‟s recurring revenues.

    Mobile ARPU declined 6% year-on-year in local currency compared with a decline of 13% in Q4 10 and in line with the previous quarter despite net customer additions in Q2 being twice as high as in Q1. The launch of 3G services in Rwanda, Ghana and Tanzania together with the development of VAS is supporting our strategy to focus on higher value customers.

    The take-up of our Tigo Cash service is encouraging in Tanzania. At the end of June, eight months since launch, the penetration of Tigo Cash reached 6% of our customer base. We launched a 3G service in Ghana in July.

    DRC seems to be experiencing tougher economic conditions with greater pressure on purchasing power. We have introduced a dynamic tariff scheme in light of market conditions, offering lower prices at off-peak times. The regulator revised the minimum tariff for all calls to 8 cents in April so advertised tariffs for on-net and cross-net calls were therefore reduced from 12 cents and 15 cents respectively, negatively impacting revenue growth.

    In Senegal, we have alleviated some of the pressure we were experiencing on capacity by increasing our capex slightly which has enabled us to meet demand for more affordable offers, but our capex level is still constrained by the ongoing litigation over our license with the Senegalese government.

    EBITDA for Africa for Q2 11 reached $100 million, up 23% year-on-year. The EBITDA margin was 40.4%, up 3.5 percentage points over Q2 10 but down quarter on quarter by 0.5 percentage points.

    Capex in Africa amounted to $46 million in Q2 or 18% of revenues. We expect capex in Africa to be higher in H2 as we invest in order to capitalize on the region‟s growth potential and for the initial 3G build out.

  • Listed mobile service provider Safaricom has terminated its contracts with at least 27 dealers over alleged fraud.

    The company announced the decision  lastTuesday to allow for investigations into a suspected fake bank documents racket that is believed to have cost it millions of shillings in lost revenue.

    "This means that these businesses can no longer act as Safaricom dealers or enjoy the rights and privileges that this status bestows," Safaricom's director of corporate affairs, Mr Nzioka Waita, said.

    According to available information, the fraud involves a dealer presenting fake bank document, normally a bank deposit slip, to a Safaricom shop.

    The dealer or his agent then proceeds to collect goods, normally airtime, equivalent to the value of the money allegedly deposited into the Safaricom bank account, as recorded on the slip. It is through this scam that the company is estimated to have lost millions of shillings.

    Dealers ordinarily collect goods from Safaricom shops under an agreement that allows them to use bank slips. The arrangement -- of depositing bank slip, the firm has previously said -- is meant to reduce the amount of cash handled by its retail shops.

    "Initial investigations show a distinct variance between money claimed to have been deposited into the account and actual account status.

    "The upshot is that some dealers may have been collecting goods for which no money had been paid," noted Mr Waita

    In what could be seen as efforts by the firm to rein in the fraudsters, last week an advocate and a city businessman were charged in Nairobi with possession of forged documents and intention to defraud Safaricom.

    As the leading player in the industry, the firm has enlisted the services of about 400 companies to run outlets throughout the country.

  • Vodacom signed up new 1,2m customers in SA in the first quarter of its 2012 financial year, taking its total subscriber base in the country as measured by active Sim cards to 27,7m. The group grew its total customer base, including its operations elsewhere in Africa, by 20,4% year on year to 45,4m.

    Group service revenue increased 5,9% due mainly to strong growth in the subscriber base and increased demand for data services, helping offset reduced revenues from reduced interconnection fees and lower effective prices. The number of active data customers, including BlackBerry users, leapt 43,3% to 10,9m.

    However, the company has cautioned that competition “remains intense in all our markets and we expect further pressure on pricing in the future”.

    In SA, Vodacom disconnected 953 000 customers who failed to register their Sim cards by the end of June in line with new legislation. By 11 July, 205 000 of those subscribers had gone through the process. Vodacom says locked Sim cards will be removed from its customer base in line with its disconnection rule.

    Total average revenue per user (Arpu) in SA fell by 4,7% to R142, largely due to a 24,8% reduction in the effective price per minute. This was offset by a 16,3% increase in average minutes of use stimulated by off-peak promotional offers.

    Contract Arpu declined 10,2% to R369 due to strong growth of lower-end contract packages and reduced out-of-bundle spend by subscribers. Prepaid Arpu was flat at R79.

    Data remains the growth story for Vodacom. In SA, revenue from data soared by 35,4% to almost R1,9bn on total revenues of R13,5bn. The number of mobile Internet bundle users climbed by 86% year on year to 3m, adding 425 000 in the quarter. Active smartphones on the network increased to 3,7m.

    International operations grew revenue by 10,2% to R2,1bn on the back of strong subscriber growth. Though still only 4,4% of service revenue, international data sales increased by 109,3% mainly due to strong growth in M-Pesa customers to 1,6m in Tanzania. M-Pesa is a mobile payments system owned by Vodacom parent Vodafone.

    Vodacom Group CEO Pieter Uys says the results are a good performance by both the SA and the international operations. But, he says: “Not everything went out way this quarter. We unfortunately experienced some outages in our SA network. While the financial impact was minimal, the negative impact on the customer experience was not acceptable.”

    Uys says Vodacom has installed more fibre capacity and upgraded “certain software” to avoid similar disruptions in future.

Telecoms, Rates, Offers and Coverage

  • - Airtel Tanzania Limited has launched communication services in Lake Zone and Manyara over the weekend.

    - Airtel Kenya will unveil the 3G mobile Internet technology in September. Managing director Rene Meza said the firm will complete technical and billing tests in Nairobi and Mombasa in the next two months, setting the stage for the launch that is expected to offer consumers more choices on the segment.

    - The National Communications Authority (NCA) of Ghana has published its latest market trends report for the fixed and mobile market, showing that the total number of mobile phones reached 19.199 million at the end of June, up from 17.436 million in January 2011. Meanwhile, the fixed line user base remained relatively stable overall at 280,711, compared to 276,808 in January, despite climbing to 293,429 in May this year.

    The leading mobile operator by subscribers at the mid-year point was MTN Ghana with 9.562 million registered users up from 8.869 million in January. Second-placed Tigo counted 4.102 million subscriptions at end-June the NCA said, down from a high of nearly 4.136 million in February, while third spot was taken by Vodafone with 3.436 million (2.810 million in January). Bharti’s recently rebranded Airtel service had 1.888 million accounts by mid-2011, up from 1.583 million in January and sole CDMA network Expresso experienced a loss of around 24,000 subscribers in the same period for an end-June total of 220,920.

Digital Content

  • Google received hundreds of applications from 19 African countries. 28 semi-finalists have been selected and they are listed below by category and countries:

    Entertainment / Media / Games

    - Human Droid, Kenya - a game that lets players battle one another virtually while in the same physical location.
    - What’s Happening?, Kenya - an events and entertainment finder in Nairobi that could be customized for other cities.
    - Matatu, Uganda - a two player competitive card game.
    - Slate Racer, South Africa - a time trial racing game.
    - Gliese - South Africa, a 2D platformer game.
    - Bawo Board Game, South Africa - an app for a popular African board game.
    - Afrinolly, Nigeria - an app to watch African movie trailers and track the stars.
    - Ha!! Buggy, Senegal - a fast-paced racing game.
    - Ayo, Nigeria - an app for an ancient board game of strategy from West Africa.

    Social Networking / Communication
    - SMS Tweetbox, Kenya - an app that connects smartphone and non-smartphone users through SMS.
    - Seekika, Kenya - a mobile audio storytelling application.
    - Olalashe, Kenya - an open source SOS and alerting mapping app.
    - Dribble, South Africa - a geo-social networking service that allows users to leave location-based messages.
    - Cnectd, South Africa - a cross-platform mobile messaging app for smartphones.
    - Setswana Phrases, Malawi - a phrase dictionary of the Setswana language.
    - Nomad, Togo - an app that pushes notifications for a social network called Oasis.
    - TextOnMotion, Nigeria - an app that allows you to navigate and text at the same time.
    - Yandda!, Nigeria - an app that engraves your signature at any location for others to discover.

    Productivity / Tools / Local / Geo
    - GPS Tanzania Guide, Tanzania - a tourist and business guide to Tanzania.
    - Shoppers' Delight, Kenya - an app that assists shoppers, comparing prices across several supermarkets.
    - Rush Hour, Kenya - an app that helps drivers navigate the streets of Nairobi with speed and safety.
    - Wedding Plandroid, South Africa - an app that makes planning a wedding easy and helps to get brides and grooms ready for their big day.
    - Booka, South Africa - an app that helps locate nearest car dealers, book a car in for a service, and track the progress of a service request.
    - SpotIt, South Africa - an app that lets users find and report animals while on safari.
    - UniDayz, Ghana - an app that helps university students better manage and prioritize their coursework.
    - Breeze Through Service, Nigeria - an app that enables services providers to improve the quality of their services and strategic business decisions.
    - Wise Africa, Republic of Guinea - an African proverbs crowdsourcing app for Android.
    - Esoko, Ghana - a market app for agricultural goods that allows users to track inventory and find the best price.

    The mobile apps ecosystem is growing fast in Africa and to find out more about it get our just published report “Mobile apps for Africa: Strategies to make sense of free and paid apps”. For more information on the report click here:

  • Not many entrepreneurs owe their success in business to a hobby, but for the few who do, it is always a pleasure to tell their story. Mr Segeni Ng'ethe, is among such investors after he ventured into online entrepreneurship.

    He speaks of a successful business whose original idea was conceived and pursued during his free time while he was still in employment in the US. Currently, his company conducts 1,000 transactions a month compared to an initial 70 when he opened shop.
    "I began as a hobby. It is something I would do at home after work but with time I gained business interest," he says.

    This is the story of Mamamike's Online Limited, a virtual shop that now seeks to capture the local market. When he set up the website in 2001, Mr Ng'ethe was into coding - a technology inspired activity. He later launched a business model in which customers shop for gift items and have them delivered to the intended recipients. The site is casually referred to as e-mbuzi in reference to a goat, which falls under the category of traditional products that are sought for such events as settlement of dowry and parties.

    But for the past 10 years of its existence, the company has only targeted clients from developed countries, mostly Kenyans in the Diaspora, where almost all business transactions are done online.

    "Being online is part of life here. This is the tradition upon which the business was built. It remained a site mostly used by these clients until last year when the fibre optic cable arrived in Kenya and made access to the Internet much cheaper," says Mr Ng'ethe.
    For this reason, the company is out to grow its business in Kenya and if his plan to provide products and services is received well he would offer Kenyans an additional online shopping platform. Based on the company's past experience abroad, Mr Ng'ethe plans to venture into selling of flowers, cakes, gift baskets and traditional gift products.
    But few changes are necessary to suit the local market. For example, while the main mode of payment has been through credit cards, the local system allows for use of mobile money transfer services that is widespread compared to credit cards.

    Over the years, Mr Ng'ethe has had to adjust to his business depending on customer needs and challenges it encounters. For example, the decision to have a goat as a lead product was reached before evaluating possible consequences of communication hitches between the company and the recipient of the product. This then meant that the company holds the product at additional costs before the recipient shows up. To counter such losses, the company outsources its services to dealers in such products who deliver them at an appropriate time. Also, with some customers preferring that such a product be delivered processed for use, Mr Ng'ethe says he engages the services of a butcher. All the expenses are charged on the customer placing an order. The driving force behind online retailing is the need for convenience in shopping just like other industries such banking.

    Like a real shop, Mr Ng'ethe spends time and money to promote his virtual store. This is a fixed expense in addition to administrative expenses. But unlike a real shop, online entrepreneurs need not worry about the cost of inventory since they are not required.
    Again, the cost of setting up an online retail site is lower than that of a physical shop since all one needs is to invest in technology and time. However, like any other business, an online entrepreneur must employ services of other professionals. "Customer care is central to online businesses. Most online shoppers want an excellent service and this can only be guaranteed through a well established customer service department," he says. It may be a convenient way of doing business but online entrepreneurship has its challenges. The most common is fraud that accounts for major losses to online companies. "It is a reality that most online businesses have been brought down by fraud. We incurred losses as a result of the crime at the beginning but with time we have learnt how to prevent it," says Mr Ng'ethe.

  • A pilot scheme to bring mobile banking and payments services to Nigeria has signed up over 6,000 people since it was launched in March 2011. Monitise, the UK based company behind the pilot, has built a network of 160 agents in four cities across Nigeria delivering services to 6,700 people.

    Monitise Africa Managing Director Prateek Shrivastava said: "There are 90 million adults in Nigeria but only about 20 million have access to financial services - but there are more than 100 million mobile phone subscribers. This is why the mobile is such a vitally important channel to reach out to a large population with trusted and secure bank-grade financial services."

    The Monitise pilot is operating in the four cities of Lagos, Abuja, Port Harcourt and Ibadan. The company was awarded a provisional license to operate a mobile payments service by the Central Bank of Nigeria in December 2010 and a decision about granting a full licence is expected shortly.

    Monitise has been supported by the Africa Enterprise Challenge Fund (AECF), which has provided grant funding to assist in the launch of its Mobile Banking and payments service.


  • - Nigeria’s new Federal Government has been sworn in, with a veteran ICT player, Omobola Johnson Olubusola, named Minister of Communication Technology.

    - South African company Altech announced the appointment of Mr. Moss Leoka as Altech Board Chairman, replacing Hilton Davies.

  • Mobile Entertainment Africa
    23 -24 August, 2011, Cape Town, South Africa

    From the team behind the Mobile Web in Africa series of events comes Mobile Entertainment Africa. Aiming to create a fantastic annual event which showcases the very latest information relating to maximising the entertainment opportunities on handheld devices, both from within Africa and further afield. Ticket subsidies are available for mobile start-ups and developers. For more information on Mobile Entertainment Africa, including the latest news and updates, visit here:
    or send an email to 

    Connecting Rural Communities Africa Forum
    24 - 26 August, 2011, Dar es Salaam, Tanzania

    The Commonwealth Telecommunications Organisation, in conjunction with the Tanzanian Ministry of Communications, Science and Technology and the Tanzania Communications Regulatory Authority will be holding the sixth annual Connecting Rural Communities Africa Forum in Dar es Salaam, Tanzania on 24 – 26 August 2011. With a milieu of ICT organisations such as Ericsson and Helios Towers Nigeria, the event promises to be an engaging forum in identifying regulatory, technical, financial and social challenges in providing connectivity in Africa.
    For more information visit here:

    Nigeria Com
    September 20 - 21 September, 2011, Lagos, Nigeria

    For more information visit here:

    North Africa Com
    11 - 12 October, 2011, Tunis, Tunisia

    For more information visit here:

    CDN World Summit
    26 - 28 October 2011, Hilton Hotel Paddington, London.

    The 3rd annual CDN World Summit promises to be the largest and most
    comprehensive CDN event ever.The full value chain is represented including content providers,broadcast operators, traditional and telco CDNs, represented by industry leaders such as; FilmFlex Movies, BT Wholesale and AT&T.
    For more information visit here:

    Digital Migration and Spectrum Policy Summit
    29 October to 01 November 2011, Nairobi, Kenya.

    Summary: Convener: ATU/Sponsor
    For more information visit here:

    Africa Com
    November 9 - November 10, 2011, Cape Town, SA

    For more information visit here:

    World Telecom Summit 2011
    9–11 November, 2011, Singapore Marriott Hotel

    World Telecom Summit 2011 is the must-attend event of the year. Bringing together top level executives and key decision makers of preeminent telecommunications companies from around the world, this is the perfect opportunity to meet the who’s who of the telecommunications and mobile industry.  It is the summit that addresses the evolving needs of telecommunications and mobile community. Get up to date with the latest innovations and technological advancements in the industry and gain access to the minds of the movers and shakers of the industry.
    Take advantage of the Limited Early Bird Rates for Operator Pass!
    For more information please visit here:
    or contact Vivian at

  • OSIX Engineer – Tanzania
    A company is currently looking for engineers with extensive experience in using OSIX tool on the Ericsson network. The location for this role is Tanzania on a 6 month extendable contract with a start date bing as soon as possible. The monthly salery is negotiable and previous working experience with Ericsson will be looked upon favourably. if you have the above experience please send your CV to the email address below.
    For further information or to apply click here:

    Exclusive Training Opportunities for African ICT Organisations
    Run by the Commonwealth Telecommunications Organasation these courses have been specially designed in collaboration with industry experts and operators to deliver a comprehensive understanding of the theories and technologies behind each topic. The courses run from the begining of August to Octiober 2011. Apply now to secure your place. Places are limited and registration deadlines apply. For more details about these or other CTO courses, visit here: or go to the CTO website here:  Both members and non-members are welcome to register. For assistance, information, or to request a registration pack, simply e-mail

  • Globacom and Ericsson - Nigeria
    Telecom service provider, Globacom, has entered into an agreement with Ericsson to replace its legacy charging platform with Ericsson's market-leading charging system.
    This will allow Globacom to have flexible pricing and discounting plans, and offer rich features to its pre-paid subscribers, such as benefits from loyalty programs.

    Bharti-Airtel and Ericsson - Africa

    Bharti Airtel has signed a five year managed services agreement with Ericsson for its Africa operations. Under a separate two year agreement, Ericsson will modernize and upgrade Airtel's mobile networks in Africa with the latest technologies. Ericsson will deploy 2G and HSPA 3G upgrades and will also provide technology consulting, network planning & design and network deployment. This is Ericsson's first multi-country Managed Services deal in Africa.