12 July 2002

Top Story

Despite Algeria’s troubled political situation, it is potentially a big connectivity market. Recently it has begun to open itself up to competition and although progress is slow, significant steps forward have been made. This week’s issue gives an overview of these developments and Yasmina Berraoui of the national agency for ICT, CERIST outlines plans to support the building of an ICT-based society in the country.


In ICT terms, Algeria starts from a relatively unpromising position as its key indicators show:


- There are less than 6 phone lines per 100 people.


- The penetration rate of PCs is low (0.65 per hundred people) and the cost to buy relatively high.


- There are few internet users (500,000) in comparison with more developed countries.


Until 2001, the telecoms sector was not really able to meet the increasing national demand for all forms of telephony. But things began to change after the recent deregulation law opened the telecom sector to private operators after 30 years of state monopoly. This is undoubtedly a major step in regulatory terms. A second operator will offer a GSM service in the Algerian market.


ISPs have also benefited from the liberalisation law. More than 50 operators got licences although only ten are currently operational. Nonetheless competition amongst the different players has offered a massive boost to internet access.


The incumbent telco, Algerie Telecom was created in March 2001 and a year later appointed Messaoud Chettih as its CEO. His financial task has been to prepare the company for outside investment through seeking a strategic partner, much as Maroc Telecom has found in the (now troubled) French company Vivendi. The current downturnm in the world telecoms market make speedy progress on this objective unlikely. This has not held back immediate investment in the network. Just last week Algerie Telecom put out to tender work on a wireless fixed telephone network of 130,000 lines to serve 42 provinces in the country.


The allegation of corruption has however bedevilled the contract for the enlargement of Algeria’s GSM network. The Commission for Public Markets granted the contract with reservations. As ever it is hard toi get to the bottom of the exact position. The Post and Telecommunications Ministry says that the bid was slightly lower than Ericsson’s (205.5 million euros as against 210 million euros) but 50% higher than Motorola (134 million euros) and two and a half times higher than Alcatel’s (84 million euros). In its defence, the Ministry claimed that both contracts did not include substantial elements included in the other two bids. Also after negotiations, Siemens cut its bid to 176 million euros and committed itself to supplying 15.8 million euros worth of in-kind services. This week the Commission for Public Markets cancelled the contract.


CEO Chettih’s operational task has been to make the business more competitive across the new connectivity markets. He has opened two new subsidiaries to achieve this end: Mobilis (for mobile telephony) and Djaweb (for internet services). Chettih was a former president of the state-owned steel company Sidmines and was imprisoned during a "anti-corruption drive" under a previous administration.


Lucent Technologies is supplying a network for internet users worth US$6.5 million that will be capable of handling 100,000 users, about double the current size of the estimated dial-up market. Djaweb will initially provide 11,000 users with simultaneous access from POPs across the country. Its international bandwidth is being supplied by France Telecom and Globalstar.


Competitor Solinet held talks in May last year with Monaco Telecom with a view to improving its service and set itself a target of 30,000 subscriptions by this year.. It competes with GECOS and EEPAD, both of whom have foreign backers.


The opening up of competition has had the effect of drawing in new investment into the market. Egyptian mobile phone operator Orascom who won Algeria’s second GSM licence in July last year selected LCC International as supplier for a US$6 million contract to implement wireless networks in Constantine, Setif and Blida. There are two other mobile operators: AMN (GSM) and Algerie Telecom (NMT-900)


Future developments depend on the effectiveness of the new regulator. In May this year, a government decree spelt out its responsibilities in terms of prices and rates. Operators will be bound to submit their accounts to the ARPT, to avoid any discrimination between users or to subsidise one service by a more profitable one. The ARPT cannot set prices but merelty regulate them in a monopoly situation where it can establish that rates are not being determined by the free play of competitive market forces. Algerie Telecom still retains its monopoly over fixed domestic and international call services.


It had one of its first disputes in June this year when Orascom took Algerie Telecom to the regulator in a case about the distribution of call revenue. In cases like this it relies on arbitrating between the two parties or imposing its own dealo on them if they continue to disagree,


The Algerian Government is aware that it needs to build an ICT-based society and economy and has therefore done a number of things to encourage the introduction and use of ICTs:


* The setting up of bodies to guide developments in the sector


The Government (through the Ministry of Higher Education and Scientific Research) has recently created a national committee to look at ICT issues. The pilot Committee is a working group that has four objectives:


- To get a national debate going on all ICT-related issues.


- Conduct a survey on what is happening elsewhere and give advice on ICTs.


- Participate in the establishment of a national ICT policy.


- Implement ICT projects.


A specialist agency - ANVREDET (The national agency for technological development) has also been created with the objective of valorising technology developments. Other work groups and committees have been set up in other fields by other government departments with a view to creating a concerted effort to promote Algeria as an information society.


* Improving human skills and adapting training materials for use with ICTs


The need to improve ICT skills has led to the creation of a new curricula designed to meet the new needs of a technology based society. Many of the private schools have started offered specialist ICT training classes in the internet, web design, networking and multimedia. In the public sector, some university courses have either update course content for use with computers a a pedagogical tool and/or new courses on ICTs.


* Governmental support to specific ICT-based national projects


Through government support, a variety of national projects have been implemented by ICT agencies like CERIST. Its mission is to set up national scientific and technical information systems, promote the use of the internet and generally promote the idea of an information society.


It is is charge of the following relevant projects:


- ARN (Academic Research Network): This project aims to connect all academic and research institutions all over the country. It also supports distance learning and virtual libraries. All universities are connected and some have their own intranets.


- National Union catalogues and databases: This project aims to create national information and resource data networks and incluses theses and a national bibliography. These online catalogues are the first step towards a national virtual library.


- Universities Library Automation: SYGEB, a standardised software designed by CERIST teams is being implemented in all university libraries. It will allow the implementation of modern search techniques and library management.


- Cyber-city project: In 1999, the government launched the setting up of 100 cyber-centres in the capital city in order to popularise the internet. This initiative was so successful that there are now moree than 1200 "cyber-spaces" open all over the country. This level of competition now means that access costs are around US$1 per hour.


- INTRANEPP and TRABIANET networks: These two national specialised networks are respectively for professional training and education. Again all centres concerned with these issues are to be connected. The implementation of such an ambitious project implies an enormous investment in PCs and a great deal of training to create the necessary human resources.


Other projects include a National Health Server, a specialised inter-banking network that would act as the precursor for e-commerce and e-payment and a National Observatory for the Information Society.


CERIST’s overall budget over three years is 12.4 billion Algerian dinars (US$o.16 billion). 62% of this budget will be spent on ICT projects. It aims to give every University lecturer and researcher a PC with internet access and endow 100 institutions with the servers to make this possible. Part of its aims are to enable Algeria to become a producer of software and to this end it is expected that CERIST will equip 55 higher education institutions with workstations for software design.


CERIST is particularly keen on international co-operation and has been involved in a number of international projects including the EUMEDIS initiative (EC-funded), UNESCO programmes in multimedia and TRANSFER, a training programme run by the international francophone agency.


An excellent source on connectivity in Algeria is Algeria Interface: