Senegal’s ARTP finally invites bids for a unified licence to compete with Sonatel

Telecoms

After a three year wait, Senegal’s regulator ARTP has finally announced the tender for bids for a unified licence to compete with the present incumbent, France Telecom-owned Sonatel. The incumbent currently has a de-facto monopoly in every sector it operates in with the exception of mobile, where it is simply the market leader.

The new entrant will find that it will be a tough fight to gain entry into the Senegalese market as there is a close relationship between the current incumbent and the Government: for example, the President’s ICT adviser both sits on the board of the incumbent and was closely involved in the process of formulating the letting of the new licence.

The major attraction of the licence is that it allows the winner to become the third mobile operator in the country alongside Sonatel’s Orange and Millicom’s Tigo brands. In addition, the bid winner will enjoy the rights to provide fixed line and Internet access services head-to-head with the incumbent. The latter has a fairly entrenched hold on the DSL market but has done little in the way of wireless roll-out.

Although a de-facto private monopoly in most markets. Sonatel (now trading under the Orange brand) has been a price progressive and both retail and wholesale prices are at the lowest end of the spectrum of African pricing. This again will be a factor that will make gaining market share for the new entrant a tough game. In addition, a key issue will be the interconnect terms given to the new entrant both before and after it is able to roll-out any element of its own infrastructure.

The Senegalese regulator, Agence de Regulation des Telecoms et Postes (ARTP), has set 31 August 2007 as the deadline for offers. The bidding process might take a second round in case more than one bidder has been received. Both Celtel and Vivendi-owned Maroc Telecom have been named as potential bidders.

Over the years, Senegalese mobile market has recorded sharp increase. In March 2007, the number of mobile users in Senegal was estimated at over 3.37 million, compared to 1.94 and 1.73 millions in 1996 and 1995, respectively. In December 2006, the total number of residential and business provided by Sonatel reached 282,573.

Meanwhile, with effective from 7 October this year, all telephone lines in Senegal will have two extra digits. Telecommunication officials said 33, 77 and 76 will be added to fix, Orange and Tigo lines, respectively.

(Source: Afrol News)