RESPONSES

Mergers, Acquisitions and Financial Results

ISSUE 151: UNANSWERED QUESTIONS IN INTERVIEW WITH VISA’S BROCKLEHURST

I read with interest the interview with VIsa’s Stuart Brocklehurst. I wonder if your interviewer could get the number of merchants in Africa that accept cards. I noticed that despite all the other numbers being African, only the international acceptance figure is quoted. The important number here is the ratio of issued cards vs acceptance points in comparison with the world norm.

The reason why this is important is core to e-Commerce and commerce in general. In infrastructurally challanged Africa, it is relatively easy to ISSUE cards, and nightmarishily difficult and expensive to ACCEPT cards. Hence the ratio. Another very important issue is the growth of the last 5 years (the e-Commerce years) in a) issuance of cards and b) acceptance of cards in Africa.An important point to note is that in South Africa Electron Cards cannot be used for eCommerce as they are PIN based cards.

Equally important would be to get the rules surrounding using Electron Cards for ecommerce. As far as I know, these rules are DIFFERENT to those that apply to a "Classic" Visa credit card where the cardholder is protected.

A vital piece of e-Commerce was missing from the interview. Verified by Visa. The implementation of this is about to be mandated by Visa and the impact of this on ecommerce risk is awesome. If possible, your interviewer should get some rules and regulations concerning this from Stuart. An important issue around Verified by Visa is the costs involved as there currently are only First World solutions available (in dollar pricing).

I found the article very interesting and offer the above as suggestions for expanding the debate.

Keep up the good work.

Barry Coetzee
IVeri

ISSUE 148: LOWERING INTERNATIONAL RATES MEANS RAISING LOCAL RATES

Thank you for the very informative and knowledgeable article GHANAIAN REGULATOR LOOKS SET TO ISSUE FRAMEWORK FOR NEW VOIP LANDSCAPE article in ISSUE 148 of Balancing Act. 100 VSAT authorizations. Authorised to do what I wonder. Suggestions about GTs commercial strategy lower international call rates must be vigorously debated (would that not be obvious if the article said that local call rates must be multiplied several fold?!)

The period of exclusivity for international terminations expired in February last year and since then the number of VSAT authorisations has gone from 30 to over 100. Access to a VSAT satellite allows users the capacity to bypass GT terminating international calls: in other words, they can take the international call income and feed it into GT’s infrastructure as a local call.

I am not sure it is correct to say that the period of exclusivity for international terminations expired in February last year. All that I know that the agreement with Telekom Malaysia which gave them and the SNO voice exclusivity expired in February. I think that it cannot be over emphasized that the regulatory system is unclear.

Secondly it is clear that if authorized, VSAT access will bypass GT international calls. Note the very big IF. It seems terrific if GT can be bypassed. The advantages can be discussed at length. Thirdly what seems a NO NO, not to use harsher terms, is to terminate international calls into GTs infrastructure.

Finally no Ghanaian will openly call for an increase in local rates. Many can call for a decrease in international call rates. I will be restrained and just say that the Ghanaian public should be told that local call rates must be increased (that is if one wants VOIP and other termination in GT local infrastructure). Of course I am well aware that the present structure cannot survive forever.

If the above is accepted what is the way forward? The first principle is that the value of a communications system is increased by the number of connections. The first priority should be to extend telephone to within the reach of EVERYONE (I mean everyone) and of course the route that presents itself is the ITU international accounting rate system.

URGENCY is the watchword because technology will not wait. The tide can be (must be?) held back for only a couple of years. The time frame for nationwide telecommunications is therefore very clear. GT’s commercial strategy is completely wrong. It must get into the international marketplace. It must use a technological approach. Of course it will only work if Government is draconian in implementing the right decision.

Sabra Asante