Telecoms in Africa – January 2014

January 13th, 2014, Published in Uncategorised articles


Internet services “could contribute 10% of Africa’s GDP by 2025”

Internet services could contribute as much as 10% of the continent’s overall GDP – equivalent to about US$300-billion – by 2025, according to research by the McKinsey Global Institute (MGI). It is estimated that Africa’s GDP from internet services (iGDP) is currently about US$18-billion. The report, Lions Go Digital: The Internet’s Transformative Potential in Africa, says public expenditure on Internet services, including digitisation of education and health services, contributes only US$2-billion, with private investment in infrastructure and digitisation accounting for US$1,5-billion; the remainder is a trade balance. “In a baseline scenario, Africa’s iGDP could grow to at least 5 to 6% of GDP, matching that of leading economies such as Taiwan, the UK and Sweden,” it says. “However, if the internet achieves impact on the same scale as mobile telephony in Africa, iGDP could account for as much as 10% of total GDP by 2025.” The research assessed 14 countries that, says MGI, together account for 90% of Africa’s GDP.

MTN to sell its towers in Zambia and Rwanda

The MTN Group has agreed to sell its tower portfolios in Zambia and Rwanda to IHS Holding. MTN will sell a total of 1228 mobile network towers to IHS’s subsidiaries in Rwanda and Zambia, comprising 524 and 704 towers respectively, for undisclosed amounts. The sale of the towers is in line with MTN’s asset optimisation strategy, and builds on two previous deals with IHS in Cameroon and Ivory Coast for a total of 1758 towers. The agreements require IHS to acquire and operate the towers and related passive infrastructure, and to invest in a build-to-suit programme to support MTN’s future requirements in both countries. MTN Zambia and MTN Rwanda will become the respective anchor tenants on the towers for an initial term of ten years. The transactions bring the total number of towers in IHS’s portfolio to 10 500, extending its leadership in the African market.

Nigeria opens wholesale broadband spectrum licence to bidders

The Nigerian Communications Commission (NCC) has invited bids for the auction of one wholesale frequency spectrum licence in the 2,3 GHz band with a minimum offer price of US$23-million. The auction, which is expected to be concluded later this year, will produce the sole provider of wholesale broadband services in Nigeria, meaning the winner will become the sole seller of broadband services to other service providers in the country.

Kenyan telcos fail compliance test

Kenya’s four mobile network operators have all failed the Communications Commission of Kenya quality service test. According to the CCK, Airtel, Orange, Safaricom and Yu, all failed in quality of service for financial year 2012/2013 based on completed calls rate, call set-up success rate, dropped calls, blocked calls, speech quality, handover success rate, call set-up time and signal strength. Safaricom was ranked worst in rates for completed and dropped calls. However, says a CCK report, none of the networks has complied with the rules over the past three years. The commission declined to say what action it plans to take, but previous incidents of non-compliance have attracted a miniscule penalty of about US$5750.

Cellcom claims delivery of 4G technology to rural Liberia

Mobile network operator Cellcom Liberia has extended its HSPA+ network, which is being offered as a fourth-generation (4G) service, to the cities of Ganta, Sanniquellie, Yekepa and Gbarnga, meaning that high-speed mobile Internet is now available to people in the counties of Montserrado, Nimba, Bong, Margibi and Sinoe. Announcing this, Cellcom CEO John Vasikaran said in the coming weeks and months the company intends to open up new HSPA+ sites across Liberia until it has coverage of the entire territory. The Liberia Telecommunications Authority has stated, however. that it has embarked on an investigation to determine the veracity of this claim.

Zimbabwe banks push for mobile banking policy

The government is considering new regulations that will force telecoms operator Econet to allow local banks unlimited access to its mobile banking service, the state media says. According to a report in The Herald newspaper, the central bank could use its power under the National Payment Systems Act to regulate the mobile-money sector. Econet, the country’s largest mobile operator, is locked in a dispute with banking industry players who want to access to the telecoms firm’s millions of subscribers to offer their own financial services. Banks such as Stanbic, CBZ and Agribank are integrated within Econet’s Ecocash system, but only as agents. The banks say this is not good enough. They want “equal cost-effective and tamper-free access to Econet’s network” for delivery of their own mobile-based services. Finance Minister Patrick Chinamasa has indicated that the central bank is reviewing the regulatory framework to cover all aspects of mobile banking, and that the government plans to tax services such as EcoCash, possibly at a rate of 0,05%.

Somali optical fibre installation halted after disagreement

A disagreement between two companies, US-based Dalcom and locally owned Hormud, both of which are involved in installing optical-fibre infrastructure in Mogadishu, has resulted in work being stopped. Dalcom has been involved in the network project for the past  year, connecting important facilities such as Mogadishu airport. Before the stoppage, the installation was scheduled to conclude in mid-2014. Government mediation has so far failed to resolve the disagreement. Dalcom says it has already spent more than US$7-million dollars in bringing fibre to the Somali coast.

Fast economic growth to boost Ugandan telecoms competition

Uganda’s telecoms sector is forecast to experience intense competition in 2014 owing to projected economic growth of 6,2%, meaning more people may be able to afford mobile phones, says the Uganda Communications Commission. Currently, the East African nation’s mobile penetration rate stands at 16,8-million – more than 46% of the estimated population of 36,4-million. According to global telecoms researcher BuddeComm, telecoms growth is also being boosted by the country’s more streamlined regulatory approach. “A simplified and converged licensing regime has significantly reduced barriers to market entry and increased competition. With annual GDP growth forecast to rise from currently 4% to 7% in 2015 and the following years, growth prospects for Uganda’s telecoms sector are excellent,” it says.

Looming digital switchover creates headaches for Cameroon

With the deadline for a global switch from analogue to digital technology looming, Cameroonians are still struggling with the challenges of digital migration. Experts working with the country’s National Commission on the digital switchover warn of challenges ahead as analogue television sets will be unable to pick up signals. It is feared that many consumers will be unable to afford new digital sets in time for the June 2015 deadline. In Rwanda, meanwhile, government will switch off all analogue transmission by 31 July 2014. According to Rwanda’s Utilities Regulatory Agency (Rura), the move is justified by the availability of set-top boxes that convert the signal and will enable viewers access digital TV images on existing TV sets.

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