SENEGAL ANNOUNCES SNO AND UGANDA TNO AS OTHERS MOVE TO WIDER SERVICE COMPETITION

Telecoms

Senegal and Uganda have both announced that further competition will take the form of licences to vertically-integrated large-scale operators rather than opening competition across a wide range of markets. This in strong contrast to Kenya and South Africa where a much wider range of service companies will be licensed.

The Senegalse Government announced that by the end-March this year it will choose a global telecommunications operator to compete with France Telecom's subsidiary Sonatel.Minister of Post and Telecommunications Joseph Ndong told reporters the winner would compete with Sonatel on long-distance and international fixed-line calls where the latter has until now had a monopoly in the West African nation. So the country will trade a monopoly for a duopoly in which Sonatel is almost certain to retain the upper hand.

"The state has decided in the course of the first quarter 2005 to launch an international tender in order to choose an operator which will be granted a global licence to enable it to operate in all segments of the telecommunications market," Ndong said.

Ndong added that Senegal would be open to further competition in sectors such as transmission of data and international calls "in order to promote a more dynamic and efficient sector". Last July, Senegal said it was opening all segments of its telecommunications market to competitors. Sonatel is 42.33 percent owned by France Telecom. The state has a 27.67 percent share, with the remainder held by institutional investors and the public. French-style attitudes to public ownership and dividends from this shareholding mean that the Government will continue to give Sonatel a privileged position in the market. Neither it nor the SNO are likely to challenge the de-facto monopolies it has in several key markets.

Meanwhile the Uganda Communications Commission (UCC) is to license a third national telephone operator (a TNO) to provide both mobile and fixed communication services. International telephone companies MTN Uganda and the incumbent Uganda Telecommunications Limited (UTL) are currently providing Mobile and fixed lines. "We are proposing to license a national operator 12 months after the expiry of the MTN and UTL duopoly in June this year," said UCC'S technical manager, Mr Patrick Mwesigye.

The new company will become operational after two years. He said since 51% of the shares of UTL are owned by the private sector, another national operator was needed to operate alongside the international companies. Given the rather slow timetable UCC may find itself losing its pre-eminent position as one of the continent's more daring regulators as others slip past with new, wider competition frameworks.

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