Telecoms in Africa – February 2014

February 14th, 2014, Published in Articles: EngineerIT

Compiled by Matthew White

Monopolies “stalling modernisation of many African economies”

African telecoms analyst Russell Southwood has warned that state-owned telecom operators, which typically have monopoly privileges, stand in the way of economic development by keeping prices high. Almost without exception, he says, they are poorly run, and the quality of infrastructure and service they provide is substandard. Southward names five country where privatisation would have a huge impact:

  • Ethiopia, the “North Korea of telecoms regulatory practice”, is a mess in terms of equipment and network procurement; prices remain high, and market development has not been helped by a ban on SMSs for several years.
  • Mozambique permits incumbent TDM to retain its monopoly, and charges neighbouring countries high transit prices for access to international fibre capacity.
  • Cameroon’s incumbent, Camtel, is hugely inefficient and its monopoly control of both the landing station and national fibre networks mean prices are higher than necessary.
  • Namibia’s telecoms monopoly keeps national wholesale prices high. Its commercial strategy to get involved in neighbouring operators in Angola and South Africa has, like foreign investments made by SA’s Telkom, been a disaster.
  • Zimbabwe hears endless rumours about potential buyers, but the recent spat about whether an ISP can run voice-over-internet protocol services shows there are still red lines in an otherwise competitive market. The Government clearly wants more money than potential buyers are willing to pay so something has to give — probably the government’s negotiating position.

IBM identifies way for Africa to bridge the technology gap

Lack of ICT skills and information security remain major causes for concern to businesses, according to a new IBM report entitled “Setting the Pace in Africa: How IT Leaders Deliver on the Potential of Emerging Technologies”. Companies in the continent recognise the seriousness of ICT to business success, with 87% ranking analytics, cloud, mobile and social applications highly. However, only 53% of are actually pushing forward with adoption. The study, which surveyed IT leaders from 29 countries, rated 36% of businesses embracing emerging technologies as “pacemakers”. in terms of prioritising and adopting technologies rapidly. “Businesses identified as pacesetters take a very different approach to addressing IT concerns,” says IBM general manager Nicholas Nesbitt. The survey found that 85% of pacesetters link IT investments to business outcomes, compared with 67% of their peers; 79% use metrics and scorecards to assess IT risk, compared with 46% of their peers, and 46% develop IT skills to meet future business needs, compared with 26% of their peers.

Mobile data consumption to shape Africa’s telecoms industry — IDC

International Data Corporation (IDC) predicts a wave of growth in digital and media content over the next 12 months as smartphone ownership explodes and African telecom users become more sophisticated in their use of mobile applications. The global research firm also identified ongoing, rapid deployment of 3G networks across the continent and the fledgling expansion of LTE services as key drivers of this growth in content. “African telecom service providers are intensifying their efforts to develop their own application stores and generate local content, with smart phone shipments up more than 40% year on year in 2013,” says Spiwe Chireka, program manager for telecoms and media at IDC Africa. Last year marked a turning point for LTE networks in Africa, he says, with the number of commercial deployments in the region increasing to 20, up from four in 2012.

Alcatel-Lucent to upgrade EASSy submarine cable system

Alcatel-Lucent is set to upgrade the 10 000 km East Africa Submarine System (EASSy) cable along Africa’s eastern and southern coastlines. The upgrade will boost ultra-broadband capacity and strengthen onward connectivity between eastern & southern Africa and Europe, the Middle East and Asia. EASSy management committee chairman Chris Wood says there has been enormous growth in demand for capacity on the system. “This upgrade will add an additional 400 Gbps of capacity throughout the system, using Alcatel-Lucent’s advanced coherent 100 Gbps technology, and enables us to take a further step in offering our customers the ultra-broadband capacity needed for innovative services and applications.” Alcatel-Lucent has reportedly also signed a deal in Libya to build a 1000 km undersea cable system linking the country’s capital, Tripoli, to Benghazi.

Burundi launches first phase of ICT backbone

President Pierre Nkurunziza has commissioned the first phrase of Burundi’s national optical fibre backbone (BBS) network in the capital, Bujumbura. In a speech marking the event, the President asked operators and Internet service providers to ensure that users can enjoy quality services at reasonable cost. Construction of the broadband infrastructure, which now covers eight provinces, began in August 2012. Nkurunziza urged the contractor, the BBS Company, to accelerate work on the second and third phases of the project.

Vodaphone Ghana engaged in major network expansion

Vodafone Ghana is undergoing major expansion to improve network quality for mobile customers in new and existing sites. The expansion, which begun in November, will see the deployment of a total of 403 coverage and capacity sites, and Core Network expansions using the latest technologies. Completion is due by the end of March. Chief technology officer Patricia Obo-Nai says network quality remains the biggest driving force of Ghana’s highly competitive telecoms sector. “It is fundamental to customer satisfaction and loyalty and Vodafone is keenly aware of this. Over the years we have invested over US$ 700m into expanding our sites from an initial 300 in 2009 to about 2000 across the country.”

Korean Telecom launches new joint venture in Rwanda

The Korean Telecom Corp. (KT), South Korea’s largest telecoms company, has established a second joint-venture company in Rwanda. The new company, Africa Olleh Services Ltd, will be involved in developing a high-speed broadband network and expanding the nation’s online services capability. KT’s first joint venture, Olleh Rwanda Network, was established last year to add 4G LTE to Rwanda’s national fibre-optic infrastructure.

Nigeria in fresh effort to liquidate Nitel

Nigeria’s Federal Government has launched a new effort to liquidate moribund Nigerian Telecommunications (Nitel), and its subsidiary, Mobile Telecommunications (Mtel). The move is reportedly a result of the government’s frustration with a series of attempts to privatise the two firms, which enjoyed monopoly status until about 13 years ago, when the telecoms industry was opened up to private-sector participation. Massive corruption is blamed for the failure of the two parastatals to compete in the liberalised industry. Every attempt to sell them to a core investor since 2001 has failed.

al-Shabaab imposes internet blackout in parts of Somalia

Thousands of residents in the Hiran, Middle and Lower Jubba regions of Somalia have been unable to access the internet on their mobile phones following a blackout imposed by militant Islamist group al-Shabaab. Telecoms companies began complying with al-Shabaab’s order to cut internet services on January 21. A week later, al-Shabaab militants stormed Hormuud Telecom’s main building in Jilib, Middle Jubba, and ordered staff to shut down its network after the company refused to pay $50,000 the group demanded as “money for jihad”. The incident has affected communication services throughout the entire Jubba region. Calls have been made on the Transitional Federal Government and the African Union Mission in Somalia o take action to end the blackout.

Call for Tanzania to take back Bharti Airtel’s 35% stake in TTCL

Tanzania’s Parliamentary Committee on Infrastructure has asked the government to take back the 35% stake that Bharti Airtel has in the Tanzania Telecommunication Co. Ltd. The state owns the remaining 65%. Committee chairman Juma Kapuya says Bharti Airtel has failed to meet the terms agreed in the contract with the government regarding development. “Among the challenges that TTCL faces is poor servicing of debts by its customers, including government institutions,” he says, adding that lack of funds caused TTCL’s failure to invest in other viable projects.

Banks in Zambia, Nigeria being investigated for cybercrime complicity

Investigation are underway into the activities of Zambian bank officials believed to be complicit in a steep rise in cyber crimes that have caused the loss of millions of dollars. Zambian police claim the officials conspired with people outside the country, and have transmitted huge sums illegally via the Internet. These funds were then shared, with some of the money transmitted back to bank officials in Zambia using different financial institutions. Four Bulgarians and a Kenyan have been arrested in Zambia in connection with cybercrime and are appearing in court. The suspects were found in possession of bank data that was used to siphon money from the banks. In Nigeria, meanwhile, the Economic and Financial Crimes Commission (EFCC) says it has cautioned five of the country’s banks after anti-corruption agencies and the special fraud unit of the Nigerian police reported an increase in cybercrime. According to EFCC chairman Ibrahim Lamorde, more than 100 cases of cybercrime at banks were reported to the commission last year; 50 such cases are already before the courts.

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