Econet Persists In Holding Back Zain Deal

According to a report by Bloomberg, an ongoing legal dispute over the ownership of Zain Nigeria between the Kuwaiti group and Econet Wireless Holdings could delay the sale of Zain’s African operations to Indian firm Bharti Airtel.

Econet, which owns a 5% stake in Zain Nigeria, claims that its right of first refusal over the ownership of the cellco was breached in May 2006, when its Nigerian partners sold their shares to Zain, and recently applied for interim measures to prevent Zain from selling, transferring, disposing of, dealing with or otherwise encumbering the disputed stake until the matter is resolved.

Bharti Airtel entered a period of exclusive negotiations, lasting until 25 March 2010, with Zain over its African operations. It remains to be seen whether delays to the sale of Zain Nigeria, Zain’s largest African subsidiary with an estimated 15.22 million customers at year-end 2009, will threaten the timely conclusion of a deal between Bharti and Zain.

Burindi Carriers Team Up To Build Fibre Line

A number of Burundian telecoms operators have joined forces to build out a national fibre-optic backbone network in the small African country, aided by the World Bank. The so-called ‘Burundi Backbone Systems’ group, which includes incumbent PTO Onatel, mobile operator Leo (formerly U-Com), Africell (owned by V-Tel and Palestinian Paltel), Econet Burundi and domestic ISP CBI Net.

Balancing Act reports that Burundi Backbone Systems will oversee the development of a 1,200km backbone and several international fibre links connecting the country to its neighbours in the next 18 months. The World Bank is contributing money to the scheme which will provide coverage throughout Burundi with cables laid alongside road routes, with 26 different nodes.

Chamisa Losses Out In Zimbabawe Telecoms Dispute

A dispute over the jurisdiction of government ministers in Zimbabwe’s telecoms sector appears to have been abruptly ended by President Robert Mugabe, who on Thursday allocated the administration of the Posts and Telecommunications Act to the Ministry of Transport, Communications and Infrastructural Development, reports Zimbabwean state-backed newspaper The Herald.

According to Statutory Instrument 40 of 2010 published in the state’s Extraordinary Gazette on Thursday, Transport Minister Nicholas Goche will administer the Act – the main legislation governing the telecoms segment – alongside other laws. Furthermore, Statutory Instrument 62 of 2010, gazetted on the same day, said Nelson Chamisa, the Minister of Information Communication Technology, will not administer any Acts.

Chamisa, a prominent figure representing the Movement for Democratic Change (MDC) party which opposed Mugabe in national elections, is now left as ‘a mere implementer of directives’ according to other local newspaper reports. Goche is a high-profile politician from Mugabe’s Zanu-PF party, and is a close ally of the President.

The Transport Minister was also confirmed as being responsible for the District Development Fund Act, whilst another law, the Interception of Communications Act, is now being administered directly by the Office of the President and Cabinet as set forth in Statutory Instrument 49 of 2010.

Telkom Confirms Bid For TelOne

Telkom South Africa has confirmed that it is in talks with Zimbabwe's state-owned incumbent fixed line operator TelOne with a view to forming a strategic partnership in which the South African national PTO would assume a management role at its Zimbabwean counterpart.

However, Charlotte Mokoena, CEO of Telkom’s Management Services department, told local press that contrary to some reports, Telkom is not bidding to buy a stake in TelOne. Previous announcements by Zimbabwe’s government have implied that Telkom was negotiating a stake purchase in the cash-strapped telco, alongside several other companies interested in partnering the PSTN operator or the country’s struggling state-run mobile operator NetOne.

The list of interested parties includes another South African company, cellular heavyweight MTN Group. Mokoena continued by saying that Telkom ‘is close to concluding an agreement, to provide management services, such as professional engineering and other functional services, to assist TelOne to prepare and build for the future.’

Algeria Denies It's Trying to Force Orascom Out

The Algerian government has denied that it is trying to force Egypt's Orascom Telecom Holding to leave the country and says the ongoing dispute with the company is solely over taxes. The company has been disputing a US$597 million tax demand that the government imposed on its local mobile network, Djezzy. The dispute covers the the tax years 2005, 2006 and 2007.

"All the government wants is that the company pays the taxes due," Finance Minister Karim Djoudi told reporters in Algiers. "We are not pressurizing Orascom to leave the country. They are willing to pay."

Relations between Algeria and Egypt have also been strained following football violence following a football match last November.

The finance minister's comments are "positive," Sally Gerges, a telecommunications analyst at Beltone Financial, a Cairo-based investment bank, told Bloomberg News. "It removes some uncertainty regarding the future of this operation and specifically regarding the reassessed taxes."

Pending appeal, Orascom Telecom is not required to pay the full amount of the tax demand. In order to file its appeal, however, Algerian law required the company to pay 20% of the taxes and penalties alleged to be owing, approximately US$120 million. The amount paid will be recoverable if the appeal is successful.

The parent company also has US$257 million of dividends from the Algerian subsidiary frozen until the tax dispute is resolved.

Vodafone Signs Deal With Libya's Al-Madar

 Vodafone says that it has signed a non-equity cooperation deal with Libyan state owned mobile network, Almadar Aljadid (Al-Madar) to offer Vodafone branded services in the North African country.

Under the terms of this agreement, Almadar Aljadid will have exclusive access to Vodafone's range of products, devices and services in Libya. In addition, Vodafone will be able to use Almadar Aljadid's network to offer its customers a range of services, which utilise 'home' network capabilities as well as extended coverage within Libya.

The partnership will also enable multinational companies located outside Libya and with local operations to meet their needs for unified communications, centralised customer care and Vodafone services using Almadar Aljadid network.

Commenting on the agreement, Colin MacDougall, Vodafone Partner Markets director for Africa and the Middle East, said: "We are delighted to partner with Almadar Aljadid in order to better serve our business customers' communications requirements as they look to grow their operations in Libya."

Malawi Threatens to Withdraw G-Mobiles Licence

South Africa's Beryl Telecoms has reportedly engaged Telkom SA to take over the management of the Malawi's delayed 3rd mobile network operator, G-Mobile. The operator itself is under threat of losing its license if it doesn't launch its network by the 12th April.

Beryl Capital and Telecoms was contracted last year to manage the roll out of its network, which was due to have been completed at the end of last year. When G-Mobile was awarded its license last April, it said that it was expected to invest US$40 million in the venture within the first five years of operations.

G-Mobile conceded that the new deadline is very tight, raising fears that the company could dissolve even before rolling out its services.

According to statistics from the Mobile World analysts, the country ended last year with just under 2.6 million customers, which represents a population penetration level of around 18%. The country has two active mobile networks, Zain and Telecom Networks Malawi.

Azur Gabon Extends Billing Contract With Redknee

Redknee, a provider of billing and charging software and solutions, has received a new contract for an extended implementation of its converged billing and airtime-selling solutions by Gabon’s newest mobile operator, USAN Gabon (Azur).

Redknee says its turnkey solutions deliver a functionally rich platform that extends beyond basic rating, charging and billing models, enabling operators to differentiate their service offerings and launch creative promotions and incentives to their customers. A key feature is Redknee's Airtime Reseller, which enables voucherless, pre-paid wireless airtime top-up.

Azur is a subsidiary of Bintel, which is registered in Dubai but headquartered in Bahrain, and has a focus on emerging markets, with subsidiaries in the Central African Republic, Somaliland, Gabon and The Republic of the Congo, and it also holds a majority stake in Swiss-based firm Telesonique.

MTN, Bharti, Zain Lead In Revenue Growth Worldwide

As part of its latest round of service provider benchmarking analysis, TeleGeography has found that 16 leading service providers have grown their revenues by an average of 45% over the last three years, equating to some 13% per annum. As could be expected, those achieving the highest growth have been focused on wireless markets in Africa, Latin America, the Middle East, India and China. Leading the growth charge are MTN, Bharti and Zain which have all more than doubled their revenues in the last three years. Despite being substantially larger companies than the top ranked three, America Movil, China Mobile and Vodafone have all recorded growth in the 45%-70% range. Of the companies covered in this research the only other to achieve similar growth is AT&T, which has achieved this via acquisition and reconsolidation of US service providers, rather than organic growth.

While it is no surprise that four of the bottom ranked five companies are incumbent operators from four of Western Europe’s largest markets, the level of their growth (or more accurately the lack of it) will surprise many: in a nutshell all five have stood still for three years. BT and NTT are locked into their highly competitive and low-growth home markets, and are also primarily dependent on wireline markets. Telefonica, Deutsche Telekom and France Telecom have all taken great strides in the past to build businesses beyond their home countries; collectively they now generate over 55% of their revenues from beyond their home markets. However, over the last three years the trio have been held back by tough competition and diminishing growth in the Western European region, and, in the case of Deutsche Telekom, difficulties growing its US operation. The results of their efforts in Latin America and Eastern Europe have not been sufficiently robust to generate substantial revenue growth for the consolidated groups.

So why does this matter? ‘Absolute scale remains an important metric, but growth often has a more direct impact on profitability and the strength of a business’ said TeleGeography’s John Dinsdale. ’The next five years will see the growth rate of telecoms markets drop to less than half of what has been experienced over the last five years. Those companies which are better equipped to meet and beat market growth rates will be more richly rewarded’ added Dinsdale.

TeleGeography’s service provider benchmarking research includes analysis of revenues, profitability, subscribers, ARPU, growth rates, geographic footprint, market share, competitive positioning and future growth prospects. It is published as part of TeleGeography’s GlobalComms Insight service which is a companion to the GlobalComms Database, a regularly updated online database of wireline, wireless and broadband competition. No other telecoms market research service rivals their collective geographic scope and depth of coverage.

http://www.telegeography.com/cu/article.php?article_id=32307&email=html

MTN CEO Announces Retirement

Phuthuma Nhleko, group president and chief executive of African carrier MTN chose to kick this week off by announcing plans to depart after eight years at the helm.

Nhleko said Monday that he will not be renewing his long term contract which ends June 30, standing down as group president and CEO. Nhleko has, however, agreed with to continue in his role up to March 2011 to enable a transition to his as yet unnamed successor.

Nhleko did not give a detail reason for his decision, saying only that it is the “Right time to secure the next generation of leadership for the group - and the right time for me personally to start thinking about the next phase of my career.”

Cyril Ramaphosa, chairman of MTN, said the firm will “explore other options for an ongoing association between Phuthuma and the group post his service as president and CEO.”

The prospect of consolidation among African and Middle Eastern operators provided much fuel for the industry rumour mill in 2009, but long running talks between Bharti and MTN collapsed last year amid concerns on the part of the South African government that its national champion could fall into foreign hands.

Etisalat Plans To Have 4 Million Clients In Nigeria This Year

UAE-based telecoms operator Etisalat has said it plans to increase its current 2.6 million mobile subscriber base in Nigeria to four million this year, Nigerian newspaper Daily Trust reports. According to Etisalat Nigeria’s CEO, Steven Evans, the company plans to achieve this through the investment of around USD700 million aimed at expanding its wireless network, compared to the approximately USD800 million spent last year.

Etisalat will rent infrastructure from telecoms companies rather than spending the money on constructing new networks. Evans added that the global economic slowdown has affected the telecoms business in Nigeria, but Etisalat remains hopeful that the industry will pick up by 2011, by which time the company is expected to break even. In order to boost its customer base, Etisalat is targeting users of other network operators by focusing on high network quality, the provision of robust products, competitive prices and good customer service.

At present, Etisalat is operational in all of the country’s states and its network covers 40% of the population.

MTN and Telkom SA Target Stakes In Zim's NetOne & TelOne

The government of Zimbabwe confirmed this week that South African cellco MTN and fixed line operator Telkom South Africa are persisting with advances to buy stakes in two Zimbabwean state-run companies, mobile operator NetOne and incumbent PTO TelOne, respectively.

Local newspaper The Herald reports that the South African firms are amongst several foreign companies that have expressed interest in buying stakes in the two operators. A senior state official was quoted as confirming that MTN and Telkom had made formal bids for the cash-strapped pair, adding that the government was in the process of considering the bids and that the respective investment proposals would soon be presented to Cabinet. According to the unnamed official: ‘Several firms have expressed interest in [NetOne and TelOne] and we are in the process of conducting due diligence on these bids. They will soon be presented to Cabinet before we choose the winner.’

An injection of foreign capital into the underfunded networks of TelOne and NetOne would further the aims of the Zimbabwean government in the communications sector. At the beginning of this week the Ministry of Information Communication Technology unveiled its new National Information Communication strategic plan that will run from 2010 to 2014.

ICT minister Nelson Chamisa said the strategic plan would address issues of infrastructure development and management, assist in the establishment of a governance regime, ICT utilisation, e-business and e-government, cyber security, ICT investment and partnerships. In addition, the plan would also focus on promoting research and development in ICT and also mobilisation of resources to achieve the ministry's mandate of transforming the sector.

‘This strategic plan... promotes the emergence and convergence of information and communication technologies... to transform Zimbabwe into a knowledge society, and pulls the entire nation around a single vision,’ said Mr Chamisa on Monday. The Ministry has already finalised its ICT Bill and is awaiting approval from Cabinet before the legislation goes to Parliament for further scrutiny; Chamisa announced that efforts were being made to pass the bill to the legislature ‘soon’.

Bharti CEO Says Africa Has Potential

While explaining the rationale for buying Zain, Africa was described as a potential emerging market by Sunil Bharti Mittal, founder Chairman and Group CEO, Bharti Enterprises.


The need of globalisation for Bharti has also been explained by him as Indian operations were generating free cash flows. While defending his decision to enter into talks with the Kuwait telecom major, he made it clear that competitive intensity is low for Zain in most countries and the valuations offered are fair and reasonable.

According to Bharti officials, Africa had good growth opportunities among emerging markets, given its high population, lower mobile penetration and relatively less competition and the tariffs too, in Africa are more than 10 times India.

Maroc Telecom Completes Fibre Link to Western Sahara

Moroccan communications group Maroc Telecom has reached 60% completion in the first phase of a plan to roll out a fibre-optic backbone network linking Morocco with West African countries, reports Dow Jones Newswires quoting Middle Eastern daily Asharq Al Awsat.

Phase one of the network will link the capital of Mauritania, Nouakchott, to El Ouyoun in Western Sahara, revealed Maroc Telecom's president Abdulsalam Ahizoune, whilst the finished route will link Mauritania, Gabon, Mali and Burkina Faso, he said.

Mobiles Help Church Growth In Africa

A mobile phone suspended on a belt round the waist, or from the neck, is a common sight among members of church congregations in Africa. Now, church leaders are heaping praise on mobile phones, sometimes called cell phones, because they say the instruments help congregations grow.

Mobile phone use increased rapidly in Africa about 10 years ago. At that time, however, some Christians on the continent criticised the phones for being "marks of materialism". Now, that has changed.

"It is as if cell phones have come to revolutionise everything, even Christianity," says Anglican Bishop Charles Gaita of Nyahururu in central Kenya. "They are making things happen quickly."

Gaita says mobile phones make it easier and cheaper for the church to spread word about its activities, such as Bible studies and meetings. The phones also make it quicker to get information, and help improve lives.

The bishop says Kenya's mobile phone boom is inspiring creativity among Christians. They are sharing Bible verses through text messaging services (SMS). Young people are using the phones to discuss religious matters on social networks, such as Facebook and Twitter, and downloading Gospel tunes to use as ring tones.

Connecting the phones to microphones to record sermons that can then be sent to congregations in remote areas may sound strange but the churches are doing it, according to Archbishop Mweresa Kivuli, chairperson of the Kenyan Chapter of the Organization of African Instituted Churches.

"If there is a preacher the congregations consider important elsewhere, we connect them to the pastor through this means," Kivuli told Ecumenical News International. "We have at times linked our churches to overseas preachers."

Africa's mobile phone subscribers total nearly 300 million, according to latest International Telecommunication Union statistics. The figure is projected to double by 2020.

South Africa, where about 80 percent of the estimated nation's 50 million population are Christians, leads the continent's mobile phone subscription level. Nigeria is second, with Kenya third.

"The Church sees the mobile phone as a blessing and a gift from God," says the Rev. Martin Wanyoike, national secretary of the Social Communications Commission of the Roman Catholic Church's Kenya Episcopal Conference. "We must use it for the service of the world."

Recently, mobile phone companies introduced money transfer services, which some Christians now use to tithe or give offerings. The churches only need to inform the congregation of the required cell-phone number for this service.

"We get money through the mobile phones once we give out the account details. We have realised there are many Kenyans who do not earn a monthly salary. So, to facilitate their offering, we use the money transfer service," says the Rev. Wellington Mutiso, an evangelical church pastor and general secretary of the Evangelical Alliance of Kenya.

Mutiso says the phones have proved useful as a follow-up tool for converts to Christianity.

"If we do not see them in church [after their conversion] , we call them or send an SMS. The response is immediate," he says. "I can assure you they [the phones] are helping the Church to grow."

At the same time, money transfer services are providing an extra way for churches to raise relief funds. In January, for example, following the earthquake in Haiti, the Catholic Church in Kenya appealed for donations for Haiti to be sent through one of the phone money transfer services.

"The response has been good. We managed to collect 500 000 [Kenya] shillings (US$6500) in a short time. The money was sent to us through the mobile phones. This is a beautiful service," says Wanyoike.

-Ecumenical News International

MTN Uganda Sues UTL Over Interconnection Fees

MTN Uganda is suing Uganda Telecommunications Ltd (UTL), seeking UGS7.2 billion (USD3.55 million) for unpaid interconnection fees. In a case filed at the Kampala High Court's Commercial Division, MTN accused UTL of breach of contract.
It claims that in February 2001 its management entered into an agreement with UTL to interconnect their respective networks, as required by their respective telecoms licences awarded by the Uganda Communications Commission. According to MTN, in accordance with the interconnection charges that were detailed in the agreement its management issued invoices to UTL, but that the state-owned telco failed to pay them. MTN has asked for a court order compelling UTL to pay the owes plus interest, damages and costs.