Vodacom Targeting Angola, Uganda, Ethiopia

South Africa-based mobile group Vodacom has confirmed that it is ready to expand its operational footprint across Africa, and is on the hunt for small-scale acquisitions. Vodacom, which is majority owned by the UK’s Vodafone Group, currently operates in five countries in sub-Saharan Africa, and chief executive Pieter Uys told Dow Jones Newswires that the company is looking to make a series of acquisitions in the USD100 million range.

Uys noted that Vodacom will focus on countries that offer a stable political environment, have densely populated cities and offer room for growth. As such, the CEO pinpointed Angola, Ethiopia and Uganda as likely targets. Announcing its FY11 results earlier this week, Vodacom noted that the financial year ended March was the first time that its operations outside South Africa have contributed positive cash flow. As a result, Uys told Dow Jones: ‘We feel more comfortable that we have the recipe to be successful outside South Africa’.


In March 2012 Sifiso Dabengwa, CEO of Vodacom’s chief rival MTN Group confirmed that his company was interested in lining up so-called ‘bolt-on’ deals in new African markets, once again naming Angola and Ethiopia. In the former, a third mobile licence has been expected for some time, with state-run incumbent Angola Telecom keen to secure an international partner to assist with its entrance to the sector. Meanwhile, Ethiopia is one of the few countries in Africa still operating a monopoly in the wireless sector, with state-run Ethio Telecom the sole licensee.

Elsewhere, Uganda is overcrowded by comparison, boasting six active wireless operators, with another, Sure Telecom Uganda, waiting in the wings. Of the country’s cellcos, Uganda Telecom Ltd and Warid Telecom Uganda are plausible targets, with the ownership of both companies coming under scrutiny in recent years.

Telkom SA "Planning Major Africa Transaction" Says Minister

South African communications minister Roy Padayachie has said that Telkom South Africa is ‘considering a major transaction in Africa’, Bloomberg Business Week reports.

Speaking at the company’s annual shareholders’ meeting in Johannesburg, Padayachie commented: ‘The board is busy with a major deal. Telkom will make an announcement soon. You have to be patient, Telkom will make the announcement when the time is right, but the board is busy with a deal’.

The minister was responding to questions regarding whether Telkom intended to make a new acquisition in Africa after selling its ill-fated investment in Nigeria’s Multilinks. Telkom bought its initial 75% stake in Multilinks for USD280 million in May 2007 and purchased the remaining 25% in January 2009 for USD130 million.

However, the telco cut its losses in June 2011 when it disposed of the loss-making unit for just USD10 million, to an affiliate of Helios Towers Nigeria (HTN).

Speaking at the meeting, Telkom chairman Lazarus Zim cautioned that the company needed to build a sustainable business in Africa, saying: ‘There were expensive and important lessons that we learnt in Nigeria’.

However, company spokesman Pynee Chetty distanced Telkom from the acquisition speculation, saying that the company has ‘not identified attractive acquisition targets in Africa at this juncture’ and that the group’s focus ‘is currently to improve the performance of existing businesses’.

Orange Extends Closing Date For Africa Social Award

Orange has extended the deadline for submitting projects for the Orange African Social Venture Prize by two weeks until 30 September.

The prize will be awarded to three entrepreneurs or start-ups that offer solutions based on mobile networks or IT systems that are designed to address various social and welfare issues faced by Africans across the continent.

Projects may range from banking or payment services to applications in essential areas such as healthcare, education and agriculture. In addition to the prestige of winning the award, Orange is committed to financially supporting and offering expert assistance to the winning entrepreneurs or start-ups.

The three prize winners will receive an endowment of between EUR 10,000 and 25,000, and will benefit from six months of support from management and ICT experts at Orange. 

The operator has also announced that the award will be part of the AfricaCom awards, with the prize giving to take place in Cape Town, South Africa, on 9 November.

Mascom Unaware of MTN Take Over Plans

Botswana’s largest mobile operator by subscribers, Mascom Wireless, has denied having any knowledge of alleged plans by South African telecoms group MTN to fully acquire the company. 


An industry insider told Botswana newspaper Gazette Business that takeover discussions between the two parties were at an advanced stage, with a full takeover and rebranding likely to take place in the next two years. 


MTN already indirectly holds a 53% stake in Mascom.


 Responding to the claims, Mascom’s communications and public relations manager, Tebogo Lebotse said in a written statement that ‘Mascom can, however, confirm it is not aware of any plans or developments of a takeover and therefore cannot comment on the consequent impact on the operational structure of Mascom.’

Vodacom Announces 43.2Mbps HSPA+ Deployment

Mobile operator Vodacom South Africa has confirmed that it has exceeded 1,000 active 43.2Mbps HSPA+ sites on its network, the South African media reports.


Although the deployment has taken place over time, Vodacom stressed that it did not want to publicise the improved speeds until they had achieved ‘significant’ HSPA+ coverage.


CEO Pieter Uys commented: ‘We have actually had the technology up and running for some time, but we wanted to have a critical mass of at least 1,000 base stations before flipping the switch to allow consumers access at up to double the speed. We wanted to make sure that we had the service available in more than just one city’.

According to MyBroadband.co.za Vodacom currently has over 4,300 3G base stations in South Africa, of which 2,650 are 21Mbps enabled, with the remainder supporting transmission speeds of 14.4Mbps.


Further, Vodacom chief technical officer Andries Delport has disclosed that Vodacom plans to have a total of 2,000 HSPA+ towers upgraded to support transmission speeds of 43.2Mbps by May 2011. Vodacom CEO Pieter Uys had previously indicated that Vodacom intends to roll out an additional 1,000 3G base stations during 2011. Despite the increase in peak speeds Vodacom has said that it is focusing on increasing the average performance of its overall network, and will connect 2,000 mobile sites to fibre by the end of the current financial year. 

However, Delport tempered the announcement by conceding that speeds of up to 43.2Mbps are strictly theoretical, and depend on how many people are using the towers, and their proximity to the base stations; in a live HSPA+ test staged on Friday Vodacom demonstrated peak download speeds of around 37Mbps. There will be no increase in costs to existing subscribers, and compatible 43.2Mbps HSPA+ dongles are now available in Vodacom retail stores. Although precise rollout details are unknown, it is believed that most major metropolitan areas will be covered from the outset. 


Vodacom’s announcement came just days before rival Cell C was set to officially inaugurate its own 43.2Mbps HSPA+ network, in Port Elizabeth, on 19 April.

WACS Arrives Near Cape Town

Submarine communications cable the West Africa Cable System (WACS) has landed in Yzerfontein, near Cape Town. The 14,000km cable, which is expected to dock at 14 different landing points along the Western coast of Africa, before linking to the Canary Islands, Portugal and the UK, is set to commence commercial service in 1Q12. The total capacity of the system is 5.12Tbps, and at least 500Gbps will be lit at launch.

Investors in the WACS cable include South African telcos MTN, Vodacom, Telkom South Africa, Broadband Infraco and Neotel.


Angus Hay, head of strategic business development at Neotel, commented: ‘This is the dawn of a new era in the South African telecommunications industry. 


Since the launch of SEACOM and later EASSy, international bandwidth to South Africa has increased. The landing of WACS sets Neotel ahead of its competitors, as it is the only telecommunications operator that has direct access to all five undersea cables landing in South Africa: WACS, SEACOM, EASSy, SAT-3 and SAFE. 


For Neotel this means that our customers are highly unlikely to experience downtime since the traffic can be moved from one cable to another in case of any cable failure. The level of redundancy, reliability and security will now increase’.

TelOne Gets GSM Licence

Zimbabwe’s Postal & Telecommunications Regulatory Authority (POTRAZ) has issued state-owned fixed line telco TelOne with the country’s fourth GSM mobile service provider licence, according to a report on AllAfrica.com.

POTRAZ deputy director-general Alfred Marisa revealed that the watchdog granted TelOne the concession late last year in response to a request for GSM frequencies from the telco when its 20-year telecoms licence was due to expire. The regulator added that it had not given TelOne fixed timelines to roll out mobile services, in light of its financially challenged status.

The state already owns a GSM operator, NetOne, the smallest of the country's three cellcos behind Econet and Telecel. NetOne is currently attempting to boost its flagging fortunes under a state-blessed strategy to find a foreign private sector investment partner, with South Africa's MTN the leading candidate. TelOne has also previously been reported to be in partnership talks with prospective foreign partners, chiefly Telkom South Africa, according to TeleGeography's GlobalComms Database, and the addition of a GSM licence could increase the incumbent's attractiveness as an investment.n the matter.

Rwanda Government MTN Shares to Be Listed

The government of Rwanda plans to list its shareholding in MTN Rwanda on the newly launched Rwanda Stock Exchange (RSE) by the end of this year, local news paper Business Times reports.


The state holds a 10% stake in the telecoms operator, which is 55%-owned by South African company MTN Group, with Tristar Investments owning the remaining 35% stake. At the launch of the RSE earlier this week, Finance Minister John Rwangombwa said: ‘We are in the process of discussing with MTN South Africa; we have 10% of government shares and there is also another investor [Tristar] that wants to divest from this company, so we might have 45% shares from MTN coming on the market soon this year.’


The move forms part of the government's broader strategy to privatise companies in to facilitate development of capital markets and increase alternative sources of long-term capital for businesses.

Domestic Market Boosts Vodacom Revenues Up 3.9%

South Africa-based Vodacom Group has reported consolidated revenues of ZAR16.03 billion (USD2.24 billion) for the three months ended 31 December 2010. 


This figure represents an increase of 3.9% year-on-year. Vodacom’s domestic unit, Vodacom South Africa accounted for ZAR14.07 billion in sales, or 87.7% of the group’s total quarterly revenues. 


The telecoms firm has yet to release figures for EBITDA or net profit. Of Vodacom South Africa’s revenues, mobile voice traffic was responsible for the lion’s share of the takings, generating ZAR7.43 billion, whilst mobile interconnection fees contributed ZAR1.78 billion, mobile data ZAR1.75 billion and mobile messaging ZAR644 million. Data exhibited the largest increase year-on-year, growing 50.5%. 

In operational terms, Vodacom South Africa remains the firm’s largest unit by subscribers, although its customer base dropped 6.6% year-on-year, to 25.3 million. However, any losses have been offset by the company’s enlarged post-paid subscriber base which grew 14.8% year-on-year. 


Elsewhere, Vodacom units in Tanzania, Democratic Republic of Congo, Mozambique and Lesotho all increased their subscriber bases in the twelve months ended 31 December. Lesotho contributed the largest proportion of growth, increasing its customer base 28.6% to 823,000. Tanzania grew its subscriber base 26%, to end the year with 8.7 million subscribers, whilst Mozambique weighed in with 2.9 million customers (up 27.7%) and Democratic Republic of Congo 3.8 million subscribers (up 9.2%). 


Vodacom Group ended the calendar year with a consolidated wireless subscriber base of 41.6 million. 


Vodacom CEO Pieter Uys commented: ‘Our strategy of focusing on operational delivery and offering increased value to customers has paid off with group customers increasing by more than two million to 41.6 million. 


In South Africa, the data business was a star performer, with growth in mobile connect cards and smartphones driving a 33.8% increase in overall data revenue. The international operations also continued to respond well to management actions with service revenue growth of 13.2%’.

MTN Announces Increase in Subscriber Base

South Africa-based telcoms group MTN has announced that its consolidated subscriber base increased to 134.47 million as at 30 September 2010, up 4% from the 129.21 million reported at the end of June. A company statement credited the increase to ‘high quality networks, attractive value propositions and efficient distribution’.

The South and East African region, which contributes 22% of the group’s customers, increased its subscriber base by 4.9% to 30.08 million for the quarter - mainly driven by growth in its domestic market. In South Africa, the customer base rose 3.9% to 17.77 million, helped by the addition of 616,000 pre-paid users and its MTN Zone offer, which allows MTN subscribers access to a discounted call rate if they are in an area experiencing a low volume of MTN traffic. ARPU in South Africa remained stable at ZAR152 (USD21.6).

The West and Central African region, which contributes 46% of the group’s subscribers increased its customer base by 3.4% in the three month period to 61.38 million. Nigeria – MTN’s largest single market and that which contributes 60% of the region’s subscriber base - grew its base 5.1% to 36.84 million. MTN credits the increase to ‘superior network quality and a successful distribution framework’. Elsewhere in the region, Ghana’s customer base declined from 8.72 million to 8.46 million due to the introduction of mandatory SIM registration on 1 July 2010.

The Middle East and North African region, which accounts for the remaining 32% of MTN’s consolidated subscriber base, increased its numbers by 4.1% to 43.01 million. MTN says that the growth within the region was mainly due to its Iranian operation, which contributes 66% of the region’s subscribers. MTN Irancell increased its users by 5.6% to 28.49 million. Elsewhere in the region, Syria benefited from improved brand awareness, increasing its subscriber base to 4.72 million, a rise of 6.8%.

Zim Not Selling Cellco's Yet, Only Restructuring

Zimbabwean newspaper Sunday News reported that four state-owned enterprises have been scheduled for restructuring before the end of this year, although incumbent PSTN operator TelOne is not on the list.

However, State Enterprises Minister Gorden Moyo said progress had also been made towards restructuring at six other companies – including TelOne, which has been earmarked for part-privatisation – although in these cases it was less likely that results would be achieved by year-end.

Also on the secondary list of six – which includes the likes of Air Zimbabwe and National Railways of Zimbabwe – is state-owned GSM mobile operator NetOne.

In February 2010 the government confirmed MTN South Africa was among ‘several’ foreign companies that had expressed interest in buying a stake in NetOne; in late 2009 MTN and NetOne signed a non-disclosure agreement on their ongoing negotiations. Telkom South Africa, meanwhile, is reportedly eyeing a stake in TelOne, which has also confirmed negotiating with a foreign suitor under a secrecy pact.

Over 70 state holdings have been earmarked for restructuring, under a Corporate Governance Framework which seeks among other things to compel the firms to submit audited financial statements and hold annual general meetings.

Early this year, Moyo instructed the parastatals to disclose audited results by the end of October, and most of the organisations’ financial reports are now reportedly with the Auditor-General.

‘The main problem is that some of the parastatals last presented their results more than five years [ago] and it is not easy to reconcile the books in a short time. But I understand a lot of the companies have now presented their results and the Auditor-General’s office has hired an independent auditing company to help look into the results,’ explained the minister.

Infraco To Launch Broadband In November

Broadband Infraco, the new State-Owned Enterprise (SOE) that will sell high capacity long distance transmission services to network service providers in South Africa, has confirmed that it will unveil its new ZAR1 billion (USD144.1 million) network during the third week of November.

The company has been plagued by licensing issues since its inception three years ago. The Broadband Infraco Act of 2007 stipulates that telecoms regulator the Independent Communications Authority of South Africa (ICASA) is obliged to issue Broadband Infraco both an Individual-Electronic Communications Network Services (I-ECNS) licence and an Electronic Communication Services (ECS) licence.

However, commercial ISPs objected to it receiving an ECS licence, as they claimed it would give the company an unfair advantage. In January 2010 ICASA bowed to communications minister Siphiwe Nyanda's policy directive, and only awarded the I-ECNS concession.

Broadband Infraco has since confirmed that it will operate exclusively within a wholesale business model, targeting both fixed and mobile operators, as well as internet service providers. Licensed operators may buy multiple capacity increments of 155Mbps - up to 10Gbps. Broadband Infraco’s lowest capacity service reportedly offers transmission speeds akin to 20 HD movies being screened simultaneously.

CEO Dave Smith commented: ‘In anticipation of receiving the I-ECNS licence, Broadband Infraco installed some 11,765km of fibre optic cable connecting Johannesburg, Pretoria, Cape Town and Durban and other large metropolitan centres including Bloemfontein, Kimberley, Port Elizabeth, East London, Nelspruit and Polokwane. The award of the Electronic Communications Services (ECS) licence from ICASA is the remaining piece of the puzzle for Broadband Infraco to deliver entirely on all aspects of its statutory mandate in accordance with applicable legislation’. According to Broadband Infraco, its network also extends connectivity to the borders of South Africa’s neighbouring countries, namely: Namibia, Botswana, Zimbabwe, Mozambique, Lesotho and Swaziland. The fibre-optic cables are scalable up to hundreds of gigabits of data per second, depending on future growth.

Cell C Launches HSPA Network in East London

South African wireless operator Cell C has confirmed that it has launched its 900MHz HSPA+ network in a third city – East London; the network has already been launched in Port Elizabeth and Bloemfontein.

The first phase of the rollout in East London will see 81% of the city’s population covered by the network. A second phase, which will ensure 100% coverage for the city and surrounding areas, should be completed by the end of this year. Subscribers in East London can expect data speeds of between 4Mbps and 7Mbps, although Cell C has claimed that customers elsewhere will be able to achieve speeds of 10Mbps.

In a related story, TechCentral reports that Cell C will launch its HSPA+ network in Cape Town today, describing it as ‘a city that has proved notoriously hard for operators to deliver wireless services’. TechCentral reports that Cell C’s rival wireless providers have experienced serious difficulties when trying to purchase ‘high-sites’ for 3G base stations in Cape Town. It is not known which suburbs will enjoy coverage at launch. Previously, Cell C CEO Lars Reichelt has promised to cover more than a third of South Africa’s population by the end of 2010. According to Reichelt, a single HSPA+ 900MHz transmitter can cover a three to five times larger area than those using a higher band.

ICASA Issues Mobile TV Trial Licence

The Independent Communications Authority of South Africa (ICASA) has issued a one-year trial permit to the locally-owned Mobile TV consortium to trial Digital Multimedia Broadcasting (DMB) technology for broadcast mobile TV services under the name 'TV4U'. The group hopes to get a trial service up and running for 1,000 users in a month or so, after missing out in a recent auction of Digital Video Broadcast-Handheld (DVB-H) frequencies, which were awarded to E.tv and Multichoice.

Telkom SA Prepares to Spread Into the Rest of Africa

SOUTH African Telecommunications operator, Telkom, has secured operating licences in east, south and west Africa, the company revealed on Monday in an interview.

Responding to questions, Telkom spokesman Pynee Chetty said the telecoms giant had secured operating licences in Nigeria, Zimbabwe, Tanzania, Ghana, Kenya, Uganda, Zambia, Swaziland and Namibia.
“Telkom’s ambition is to become a significant Information Communication Technology (ICT) player in Sub-Saharan Africa, focusing on the enterprise market.

“Apart from the satellite-based (SAT3) cable system, Telkom has invested in the new WACS, EASSy and SAFE submarine cables systems to further strengthen its position with regards to connectivity on the African continent,” said Chetty.

He said the operations in those countries consisted of consumer and enterprise solutions within the respective markets.

Chetty said Telkom would continue to service all these markets and acquire capabilities, through partnerships or own assets, to meet the demands of the local African enterprise and global multinational customers.
“The company continues to investigate opportunities in Africa and endeavours to expand into countries where customer demand warrants such actions.
“As far as the specific products and services are concerned, it is logical to utilise existing skills and capabilities acquired in the domestic market as far as possible when entering new markets,” said Chetty.

Econet Cuts Ineternational Rates by 50%

Econet Wireless Zimbabwe has cut its international call rates by up to 50%, meaning users can phone destinations including the UK and South Africa for as little as USD0.004 per second (USD0.24 per minute). Aiming to boost previously flagging international voice revenues, Econet stressed that mobile calls from Zimbabwe to South Africa are now cheaper than the reverse. Zimbabwe’s three cellcos – Econet, Telecel and NetOne – recently introduced a universal per-second billing system for all mobile calls.



Separately, an Econet spokesperson announced that the South African mobile virtual network operator (MVNO) owned by the Econet Wireless Group (EWG) has sold more than 500,000 SIM cards in the last twelve months to Zimbabweans living in South Africa, piggybacking on Cell C's network under the 'Call Home' banner. The spokesperson predicted that Econet Wireless South Africa’s SIM card sales would exceed one million ‘within a few months’. EWG recently set up a similar MVNO service in the UK targetting people calling African countries.

Kenya's Digital Village Project Gets IBM Boost

Kenya’s Digital Village initiative, which was rolled out in 2008 with the purpose of narrowing the digital divide between rural and urban areas, and accelerating the growth of ICT in Kenya, received a boost when a team of IBM Corporate Service Corps consultants (CSC) from seven different countries arrived in Nairobi for a one month project aimed at defining a rollout strategy for the project.

Under regulations introduced by the Communications Commission of Kenya (CCK) in 2009, each constituency in Kenya should have at least five digital centres, complete with computers and internet connectivity. IBM’s eleven-strong team will start work in Machakos, joining forces with the ICT Board and the Ministry of Information and Communication.

The IBM-guided initiative will run alongside similar programmes that are currently being rolled out by other Kenyan telcos as they seek to meet new regulatory requirements.

IBM CEO Samuel J. Palmisano commented: ‘People are on the ground in Machakos to help the government realise its aim of extending the reach of digital services to rural areas. This will form part of our drive to boost ICT use in countries like Kenya.

IBM is well known for helping public and private sector organisations around the world to leverage technology to drive innovation and do things smarter. The Kenya initiative is part of a programme in Africa which began in 2008 through which IBM has deployed teams to Tanzania, Nigeria, Ghana and South Africa’.

eFive Choses Alcatel-Lucent For Undersea Cable

South African telco eFive Telecoms has selected Alcatel-Lucent to build a new submarine cable network linking the west coast of Africa to South America, the French/US equipment vendor has announced. The network will consist of two trunks – the first one connecting South Africa to Angola and Nigeria, and a second trunk linking Angola to Brazil.

Alcatel-Lucent has confirmed that it will be in charge of the project end-to-end, with responsibility for the system’s design, manufacture and installation. The cable will be maintained by Alcatel-Lucent through its Atlantic Private Maintenance Agreement (APMA), which currently covers over 100,000km of submarine cable infrastructure from the west coast of Africa to the Caribbean and as far north as Greenland.

Lawrence Mulaudzi, managing director of eFive Telecoms commented: ‘We believe that high-growth areas such as the African continent require the development of new projects. The planned submarine network will also provide cable route diversity to South America, making the most economical and operational sense in the current landscape’. Philippe Dumont, head of Alcatel-Lucent’s submarine network division added: ‘Growth in African internet and mobile telephony is driving service providers’ demand for more connectivity options to ensure higher reliability, as well as increased widespread access to bandwidth.

This project will further position Africa as a major hub for broadband connectivity’.

MWEB to Finally Launch New ADSL Product

South African ISP MWEB has announced that its long-rumoured 10Mbps uncapped ADSL products will finally be available in September.

The company has explained that the delay is down to incumbent PSTN operator Telkom’s hesitant upgrades of MWEB’s IPC platform – the bandwidth that connects MWEB customers to Telkom’s last-mile network.

Although 4Mbps ADSL subscribers in certain areas have already been upgraded to 10Mbps, users in cities such as Pretoria, Johannesburg, Cape Town, Durban and Port Elizabeth are only reporting speeds in the region of 6Mbps. As things currently stand, MWEB has to make use of additional capacity on its SAIX network in order to meet its total ADSL demand. It is reported that the additional SAIX capacity costs MWEB ‘a great deal of money’.

A spokesperson for MWEB commented: ‘Firstly, we want to satisfy ourselves that Telkom has addressed some of the congestion problems on its own network, to cater for this additional demand. Then, we are waiting for Telkom to finalise an upgrade to our own IPC platform.

These upgrades were put on hold during the World Cup, but work has now resumed and will hopefully be completed within the next three to four weeks. Until we have this additional capacity in place we are not comfortable of being able to offer a product that lives up to our own high standards, and meets your expectations in terms of performance and reliability.’

G-Mobile Lays Out Its Plans

Malawi-based start-up cellular operator G-Mobile has announced that it will invest USD150 million in the next three years to become a realistic contender in the country’s GSM market.

CEO Peter Davies also told reporters that the South African-backed company had already injected USD25 million into the network, which is expected to be commercially launched by the end of the year.

On 20 May 2010 G-Mobile, registered as Global Advanced Integrated Networks (GAIN), was given 30 days to pay a USD6.9 million fine issued by regulator MACRA for failing to deploy its wireless network.

However, the cellco took the matter to the High Court in Mzuzu and gained an injunction against the penalty until a judicial review could be carried out. On 12 July Justice Lovemore Chikopa upheld the injunction and set 23 August 2010 as the date for the matter to be heard in court. G-Mobile has partnered Telkom Management Services of South Africa to help it plan and deploy a network and is using ZTE of China as an equipment supplier.

Mr Davies claimed that the newcomer aims to raise the level of quality in Malawi’s mobile services sector as well as bringing down the cost of calls in the country.