Zantel's new CEO Noel Herrity on expansion plans, IP networks and its investment in EASSY

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When Tanzania recently signalled a new phase in liberalising its telecom markets, the Zanzibari operator Zantel was quick to announce its intention to operate in mainland Tanzania. It struck an infrastructure deal with Vodacom so that it could roll-out its services quickly, in effect operating as an MVNO. It has also been one of the moving forces behind the East African fibre consortium EASSy. It is also believed to be one of the operators favouring a more Open Access approach to the structure of ownership and sale of capacity. This week we interview its recently appointed CEO Noel Herrity who comes from Botswana's BTC, who talks about this small operator's big expansion plans.

Q: Can you give us an overview of Zantel's operation?

Zantel has been in operation since 1999 in Zanzibar where it has been the SNO, providing fixed and mobile services. In Zanzibar, ZANTEL has been providing both, Basic Fixed and Cellular Mobile services, the fixed services being provided in the form of wireless access off the single GSM platform.

Since commencing commercial operations from a "green field" position with our start up in September 1999, ZANTEL has achieved availability of both Basic Fixed and Cellular Mobile services covering some eighty to ninety to ninety five percent on the island of Unguja and about seventy percent on the the island of Pemba

In February 2005, following the end of the exclusivity accorded to TTCL, the Tanzania Communications Regulatory Authority, TCRA, extended ZANTEL'S service areas to include the Mainland

Zantel is probably better known as an International Gateway provider and has built up quite a reputation as a quality International service Hub. With regard to the provision of international services at the African Regional level and worldwide, ZANTEL, via its International Gateway comprising four (4) Satellite Earth Stations, Standard A, Standard B and two F1 Earth Stations, has implemented and established direct interconnect links with strategic key operators both in Africa, at the Regional level and abroad in the Middle East, Europe and North America. Via these interconnects, cost effective, end to end and transit PSTN voice quality services are being provided

Q: What are Zantel's ambitions on the mainland?

On the Mainland, following the end of TTCL'S exclusivity, ZANTEL commenced the implementation of its GSM Mobile network in Dar es Salaam and this work is ongoing. The core network comprises a new MSC and BSC with a rollout of BTS'S brought into service as the customer base builds up.

Zantel commenced provision of GSM Mobile services on the Mainland on 7th July, 2005, to coincide with the Saba-Saba Day. To facilitate quick market entry Zantel entered into a Roaming arrangement, at the National level, whereby Zantel has access to the VODACOM network for the provision of mobile services on the Mainland. This network infrastructure sharing makes optimal use of existing networks thus obviating duplication whilst releasing capital for the development and launch of other much needed services including, backhaul access, access networks, investment in the Eastern Africa Submarine Cable System, (the EASSy Project) shore-end landing facilities, amongst others. In Tanzania today, Zantel provides GSM Mobile coverage, in most areas via its own network infrastructure and the Roaming arrangement mentioned above.

Q: How will all this translate in terms of market share of the fixed and mobile market over the next 2-3 years?

The market in Tanzania is growing strongly. Some say the market for mobile alone will reach 9m to 10m over the next four to five years .There are already 3 large Mobile Operators, about 10 Internet and Data service providers and the incumbent TTCL providing fixed services . Zantel aims to gain an appropriate share of the market growth. We are already providing mobile and International services and are looking at how we will address the opportunities for Fixed and Data services.

Q: How many subscribers do you plan to attract over that same period of time?

Millions!

Q: On the mobile side, Zantel is sharing infrastructure with Vodacom. How does this arrangement work?

It follows a similar arrangement which Vodacom had with CellC in the SA market.It is beneficial for both parties. It is also beneficial for our customers because it provides Vodacom network reach at Zantel rates.

You recently moved from BTC to Zantel. Can you tell me a bit more about your background?

I've been in the telecoms business for over thirty years and have been involved in Fixed,Mobile and Internet elements of the business having launched these services in Ireland.

Q:What did you learn from your experience at BTC?

The business heartbeat of Africa is very strong but it has its own unique rhythm. If you want things to work well you have to listen carefully to that rhythm and respond accordingly.

Q:While at BTC, there was a project for implemeting an IP based network. Do you plan to do the same thing in Zanzibar?

I think some day (and soon) ALL networks will be IP based. Zantel understands that and will plan accordingly .

Q: How did Zantel get involved with the EASSy Consortium and what's its role?

Zantel, in mid 2002 took the initiative to examine the possibilities of implementing an undersea submarine optical fibre cable system that would provide wideband, high capacity connectivity worldwide for Tanzania and Kenya via interconnects with existing similar cable networks on the North Eastern and South Eastern sea board of Africa.

The original initiative, with modest beginnings, has matured further and considerable progress has been made towards its realisation.

Currently Zantel is the overall coordinator of this project designated as the "Eastern Africa Submarine System" - EASSy Project.

The expanded project is planned to have shore landing points on the Eastern Africa sea- board stretching from Durban in South Africa to the North East to Port Sudan via Djibouti. The individual coastal shore landing countries will together with their neighbours develop the hinterland and cross border accesses to the land locked countries.

Q: What do you think about the structure of the Consortium? Any ideas that you want to share with us?

It would not be appropriate for me to make comment on that.

Q: Regarding Zantel's financial involvement in the Consortium, what level of financing are you putting in and how will that be secured?

The final level of financing by all the parties has not yet been finalized because the overall costs and capacities have not been finalized. By way of indicatio: Zantel will be the 'landing party' for Tanzania .The minimum commitment for a landing station is a throughput of US$10m