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.

Airtel Enters Rwanda Market

Indian telecoms group Bharti Airtel has announced it has secured a licence to provide 2G and 3G cellular services in Rwanda, The New Times reports. 

The company plans to invest over USD100 million over the next three years, including USD30 million for the purchase of the operating licence. 

It aims to bring ‘affordable services and innovative products’ to the market, and plans to expand its wireless broadband network to all major towns across the country.

 In June 2010 Bharti Airtel acquired the African assets of Kuwait’s Zain Group, in a deal valued at USD10.7 billion. The company took over Zain’s operations in 15 countries, including Malawi, Burkina Faso, Ghana, Kenya, Nigeria, Sierra Leone and Uganda.

Bharti will join two other mobile operators in the market: South Africa-based MTN Rwanda, which had a total of 2.794 million mobile subscribers at the end of June 2011; and Millicom Rwanda (Tigo), which is majority-owned by Luxembourg-based Millicom International Cellular and had a subscriber base of over 812,000 at the same date. A third operator, Rwandatel, had its mobile licence revoked in April 2011, after the company failed to meet licence obligations, such as coverage, quality of service and planned investment targets. Rwandatel is 80% owned by Libyan government investment vehicle LAP Green Networks, although telecoms regulator RURA said the decision to cancel its mobile licence had nothing to do with enforcing a United Nations (UN) resolution to impose sanctions on Libya, including the freezing of its assets, following unrest in the North African nation.

Airtel Uganda Increases Tariffs Amid Rising Inflation

Airtel yesterday became the second communications company in Uganda to up call tariffs with new rates starting Monday next week.

The increase has been occasioned by the higher costs of doing business in Uganda, according to Mr V.G. Somasekhar, the managing director of Airtel Uganda.

Customers will pay Shs4 per second, an increase from Shs3 per second or Shs240 per minute instead of Shs180 per minute.

The new rates will apply to all calls on the Airtel network and other networks, according to a statement from the company.

“The telecom business is trapped in a cycle of rising business costs, which is significantly threatening the level of service delivery in the industry,” Mr Somasekhar said yesterday. “The upward adjustment in tariffs will ensure the company continues to meet its operational costs and maintain its unequalled level of service delivery in the market.”

Airtel’s announcement came just a day after MTN Uganda doubled its calling tariffs from Shs2 per second to Shs4 per second, also citing the increasing cost of doing business.

The economy is struggling with the depreciating Shilling, the rising cost of fuel and persistent power blackouts.  This week, inflation hit a record 20% mark.

Uganda Moves To Stop Airtel, UTL Cut-off

The Ugandan government moved to stop Airtel Uganda from deactivating calls to the Uganda Telecom network over a UGX 10 billion dispute.

According to local paper the Daily Monitor, ICT Minister Ruhakana Rugunda said the government was talking to both sides in a bid to resolve the dispute.

Godfrey Mutabazi, the executive director of the Uganda Communications Commission, also confirmed that talks were underway to resolve the matter but it was unclear if an understanding had been reached.

Airtel had announced that its customers would no longer be able to make or receive calls to UTL numbers from 1 September. This followed the termination of the interconnect agreement between the two operators on 15 August, after UTL failed to pay up to UGX 10 billion in outstanding interconnect fees and legal fines to Airtel.

Joseph Kanyamunyu, Airtel's spokesman said the operator would not lift the ban on calls until UTL clears the debt.

Uganda Has Largest Number of Fake Nokia Phones in East Africa

Uganda has the highest number of substandard mobile phone devices in East Africa, The Daily Monitor reported.

Analysts blamed the delayed enactment of the anti-counterfeit law by the county's parliament.

Kenneth Oyolla, Nokia general manager for East and Southern Africa, said 30 percent of all mobile phones sold in Uganda are counterfeits, compared with 10 percent in Kenya.

Nokia loses about USD 15 million monthly in the Kenyan market while the figures are higher in Uganda and Tanzania, he said.

The Kenyan government passed an anti-counterfeit law in June 2010 that provides for anyone caught selling counterfeits to pay three times the retail value of the device and up to five years in jail if implicated again.

Oyolla said the law has reduced trade in counterfeits in Kenya and should be replicated in all EAC countries as it is a common market.

Traders dealing in counterfeits can easily cross to other countries in the region where there is no deterrent law, he said. A genuine E71 costs USD 230 while the fake one goes for about USD 50.

Uganda's anti-counterfeit bill was not passed into law after the eighth Parliament closed before the bill's second reading.

Oyolla, who was speaking at the launch of the Nokia 101 and Nokia 100 mobile handsets in Nairobi, said the firm has partnered with retailers in the sale of genuine devices as one of the ways to reduce revenue loss.

Airtel To Terminate UTL Calls

Airtel Uganda has announced that starting 5th September 2011 its subscribers will not be able to receive calls from or make calls to Uganda Telecom (UTL) lines.

In a statement published on Wednesday Airtel states that the decision follows the expiry on 15th August 2011 of the interconnection agreement between itself and UTL.

Earlier reports had indicated that UTL owes Airtel over 8 billion shillings in interconnection fees.

UTL has been battling a court case in which MTN Uganda is demanding over 20 billion Uganda shillings. Last week a court in Kampala ruled in favour of MTN but UTL has appealed against the decision .

69% of UTL is owned by the Libyan government through its investment vehicle, Libyan Africa Portfolio (LAP), with the remaining 31% owned by the Ugandan government.

UN sanctions in March required the freezing of Libya’s assets for the duration of its on-going civil war, but in order to prevent the loss of jobs, the Ugandan government took over complete control of the company.

Early this year Uganda’s Media Owners Association reportedly ceased any advertising for UTL, citing unpaid fees of 3 billion Uganda shillings.

Airtel Kenya Launches Quiz Cash Give Away

Airtel Kenya has launched a promotion that will see one customer win KES 100,000 daily for 90 days.

Under the name Airtel Cashmania, customers can answer questions and be entered into a daily draw for a chance to win the cash prize.

For every correct answer a customer sends, the customer will receive 20 chances or more. For every incorrect answer the customer will receive 10 chances.

To participate in the promotion customers need to send a SMS with their first name to the short code 888. Every SMS is charged at KES 25.

A similar competition was launched by Airtel Uganda last month dub be "Kyaba Too Good!

Libyan Owned Uganda Telecom in Finacial Crisis

THE financial sustainability of Uganda Telecom (utl) remains uncertain following several claims of unpaid dues in billions owed to the firm’s partners and service providers. 

Among the companies seeking payment is MTN, which for the second time this year, has sued utl claiming unpaid sh9.3b accrued from interconnection charges, indicating a further deepening rift and uncertainty in the telecom industry. 

According to sources, the Uganda Communications Commission (UCC) is also demanding about sh6b from utl over non remitted contributions to the rural communication development funds. 

All telecom operators are required to remit 1% of their gross revenue to the commission for the fund. 

Sources revealed that a fortnight ago, the Uganda Media Owners Association also suspended any form of advertising from utl because of about sh3b unpaid dues accruing from advertising. 

The association comprises major media houses, including Monitor Publications, Vision Group, NTV, WBS, UBC, Capital FM, Simba and Sanyu FM. 

Airtel Uganda public relations officer Joseph Kanyamunyu said utl also owes them about sh8b from “interconnect and related charges.” 

MTN is also demanding another sh744m in interests accrued from May 31, 2011. 

“The actions of the defendant amount to breach of the interconnection agreement between the plaintiff and the defendant,” read the suit. 

“They have continuously disputed figures, but in this case they signed and acknowledged the debt, but we are half way the year and they have still failed to pay,” said an MTN official. 

The MTN suit filed on June 15 says the interconnect fees are for the period from January 2010 to December 2010. 

But utl chief Donald Nyakairu said there was nothing new in the law suit. “The only difference is in the figures, they are just causing anxiety within the public,” said Nyakairu. The suit follows an earlier one, filed about three months ago, over MTN’s claims of unpaid sh20b in interconnection charges that the telecom giant says was accumulated over a three-year period. 

The interconnection fee is the amount an operator pays another for routing traffic through their networks. 

David Ogong, the UCC director of competition and corporate affairs, said they had been mediating over this issue and the two players agreed to keep their networks connected until June 26, 2011. “We are advising the Government that we could have a big problem in our hands, we have tried our best to see that utl pays,” said Ogong. 

The Libyan government owns about 69% of utl under its investment arm, Libya Africa Investment Portfolio. The Government owns the rest. But a few months ago, government took over full control of utl partly complying with UN sanctions against Libyan assets in the wake of the political turmoil in the North African state.

Essar Denies It Is Selling Off Yu

Indian conglomerate the Essar Group has denied international media reports suggesting that it is looking to sell off its 70% stake in Kenyan mobile operator Essar Telecom Kenya (ETK), which operates under the ‘Yu’ brand.

The Essar Group hit back at the claims – which originated with India’s Economic Times earlier this week – commenting: ‘Essar remains committed to the African market and is satisfied with its operations in Kenya. It is not evaluating any sell off options’.

The original report coincided with the Essar Group’s admission that it has pulled out of a long-standing agreement to acquire telecoms assets in Uganda and the Republic of Congo. An unnamed source, with knowledge of the matter, suggested that the Indian firm no longer viewed telecoms as a core strategic interest.

Speculation was rife that South African telecoms giant MTN – a company with a long-held interest in securing a foothold the Kenyan wireless sector – was interested in buying out ETK. MTN is now believed to have distanced itself from the rumours.

Uganda's Opposition Calls for MTN Boycott

Uganda's main opposition party has started a campaign calling upon its supporters to boycott the services of the country's largest mobile telecommunications company, MTN Uganda Ltd. blaming it for disrupting the opposition poll tally center during the February 18 presidential polls.

The opposition blames MTN Uganda, a unit of Johannesburg-listed MTN Group Ltd. of intentionally jamming the telephone lines that the opposition Forum for Democratic Change (FDC) had bought for its polling agents to transmit results to its tally center on February 18, according to Wafula Oguttu, the FDC spokesman.

"They sabotaged our tally center and we could not tally our own results," he said."MTN is involving itself in Ugandan politics."

According to Oguttu, the FDC has started a nationwide campaign, calling its supporters to discard MTN sim cards. The opposition also accuses the company of giving campaign funds and free airtime to the ruling National Resistance Movement party.

An MTN spokeswoman denied the opposition allegations and said the company is considering legal action after party leaders publicly destroyed and burned MTN sim cards at a press conference on Friday last week.

"We have never received a formal complaint about the alleged jamming of the lines from the FDC," she said.

MTN has at least 6.5 million cell phone subscribers in Uganda

Veteran opposition leader, Kizza Besigye had set up a parallel tally center to tally his own votes saying he had no faith in the ruling party-appointed electoral body, however, the center was sabotaged, before being invaded by security forces on February 18.

The FDC claimed to have only tallied results from around 30% of the polling stations, showing Besigye in the lead with at least 47% of the vote, compared with President Yoweri Museveni's 46% by the time the center was sabotaged.

The Electoral Commission later announced Museveni as the winner with 68% of the vote, but the polls were marred by a number of irregularities, according to observers.

Uganda Takes Over Libyan-Owned UTL

The Ugandan government has taken over management of troubled Libyan-owned telecommunications company, Uganda Telecom Ltd. (UTL), Uganda's minister of information and communications technology said Tuesday.

As a regulator and a minority shareholder in Uganda Telcom, the government has decided to take over management of the company to safeguard its interests and the interests of its customers, Aggrey Awori said in a telephone interview with Dow Jones Newswires.

"We cannot sit and watch as things get out of hand," he said.

The Libyan Arab Portfolio, or LAP Green Network, holds a controlling stake in Uganda Telecom.

According to Awori, the move is part of government's decision to implement the United Nations-initiated sanctions against Libya. Last week, the Ugandan central bank took over Libya-owned Tropical African Bank.

Uganda Telecom has been struggling to meet payment obligations to other Ugandan telecom companies arising from interconnection fees. A company spokesman couldn't return calls seeking comment immediately.

Earlier this month, MTN Uganda--a unit of Johannesburg-listed MTN Group Ltd. threatened to block calls to Uganda Telecom over a 20 billion Ugandan shillings ($8.3 million) unpaid interconnection fees that have accumulated over a three-year period.

Airtel Uganda Ltd. also claims that Uganda Telecom owes it UGX8 billion in interconnection fees and had also threatened to terminate calls to the network. Airtel Uganda Ltd. is a unit of India-based Bharti Airtel Ltd.

However, government has prevailed upon the two companies from blocking calls to Uganda Telecom, to avoid inconveniencing the public. People familiar with the situation say that the two companies were now planning to attach some of the properties belonging to Uganda Telecom.

Attachment is a legal process by which a court of law, at the request of a creditor, designates specific property owned by the debtor to be transferred to the creditor, or sold for the benefit of the creditor.

Uganda's foreign affairs minister announced last week that government would freeze Libyan assets worth $375 million; other Libyan-owned companies that have been affected by the sanctions include Tamoil East Africa, National & Housing Construction Company, Laico Lake Victoria Hotel and Libya Oil. 

-Dow Jones Newswires

Telkom Kenya Launches Domestic Broadband Services

Telkom Kenya has confirmed that it has launched fibre-to-the-home (FTTH) broadband services in Muthaiga and Parklands, two of Nairobi’s most affluent suburbs. 

Telkom claimed that transmission speeds of up to 8Mbps are now available to subscribers. The service will reportedly be extended to other areas in due course, with triple-play services mooted by end-2011, pending negotiations with TV content providers. 

New double-play tariffs start at KES2,999 per month (USD34.7), rising incrementally to KES6,500. The premium package includes 2,000 free fixed line minutes, and an additional 3,500 mobile minutes.

Telkom Kenya CEO Mickael Ghossein commented: ‘By integrating our copper and fibre infrastructure, our new bouquet of ‘Orange Double-Play’ offers that we are unveiling today, are undoubtedly set to exceed the voice and data communication expectations of our customers. With speeds of up to 8Mbps, we now have a network easily scalable to transmit video signals, just like in developed countries. We are already in talks with partners that will see Orange introduce triple-play services in the near future. Today, we are launching Orange Double-Play to serve residents and businesses in Muthaiga and its environs; however we will soon roll this out further afield into other areas. We have now achieved our dream of delivering true broadband to Kenyan homes’.

If Orange does launch triple-play as planned, it will go head-to-head with the Wananchi Group which launched its own long-awaited triple-play service in December 2010, under the Zuku brand. The fibre package went live in the districts of Kileleshwa, Kilimani, Lavington and Hurligham. Fibre rollout to the remainder of Nairobi and Mombasa is scheduled to be completed during the second half of 2011, whilst Tanzania and Uganda have been mooted for subsequent connectivity. Wananchi intends to pass one million homes in East Africa by 2015.

MTN To Cut Links With Uganda Telecom Over Three-Year Debt

A three year dispute over inter-connectivity fees has culminated in MTN Uganda announcing that it is severing interconnectivity with its industry rival Uganda Telecom (UTL), the Daily Monitor reports.

“MTN customers will therefore be unable to place direct calls to UTL subscribers, and vice-versa,” MTN said in a notice on Wednesday. “This action has been necessitated by UTL continuously defaulting on the settlement of its interconnect payments, amounting to about Shs20 billion accumulated over a period of three years,” the statement added.


In an earlier separate interview, UTL company Secretary Donald Nyakairu said the company was in the process of settling MTN’s dues. This, however, seems not to have materialised.

The stand-off comes after a row between the two companies, stemming from 2006 over the unpaid interconnectivity fees ended in UTL failing to pay MTN. UTL has also been in dispute with Warid Telecom and Airtel Uganda over unpaid interconnectivity fees all totalling to over Shs12 billion.

The Uganda Communications Commission (UCC) is also demanding Shs9 billion in unpaid yearly fees from UTL although its Interim Executive Director Godfrey Mutabazi declined to elaborate on the matter.  “Interconnectivity issues are between telecom subscribers,” Mr Mutabazi said yesterday. “We only encouraged dialogue but we do not interfere.” Yesterday, MTN said UTL had unjustifiably and persistently refused to honour their business obligation and attempts to resolve the matter failed.

MTN last year took UTL to court and secured an order to pay the money in dispute.  Court documents obtained by the Daily Monitor indicated that between November 2008 and 2009, MTN demanded Shs7 billion in outstanding interconnectivity fees.

In February 2008, it issued UTL with another invoice demanding another payment of Shs6 billion, also for interconnection fees for March 2007 to December 2007.  UTL paid Shs3 billion but said it would not pay the balance of Shs3 billion which it said was not as a result of domestic traffic which attracts interconnectivity fees but was international traffic with Sudan.

In 2006, Ms GEMTEL a telecom operator in South Sudan requested Uganda to facilitate its calling code. On May 10, 2006, Works Minister John Nasasira wrote to UTL approving a request to extend its network coverage to South Sudan. UTL notified Gemtel that it will grant it usage of code +256 477.  +256 is the official Uganda country code.

On June 22, 2006 UTL informed MTN that it had set up interconnection with GEMTEL adding that it had been assigned +256477 which is a Ugandan calling code. MTN says this is the source of the accumulated fees.

LAP To Launch In Sierra Leone This April

GreenN Sierra Leone, a subsidiary of LAP Green Network, itself 100% owned by Libyan government-owned investment vehicle Libyan Africa Portfolio (LAP), will launch commercial operations in Sierra Leone’s wireless market in April this year, local newspaper Awoko reports.


Earlier this week Information and Communications Minister Alhaji Ibrahim Ben Kargbo made the first official call over the company’s GSM network to President Koroma. The minister said that GreenN Sierra Leone is part of efforts to strengthen the bilateral ties between Sierra Leone and Libya. 


According to GreenN Sierra Leone’s CEO, Elmabruk S. Elgembari, the company plans to invest USD50 million in the next three years, adding that the operator has so far constructed a total of 128 cell sites, including 42 in the provinces. 


The CEO also revealed that GreenN will provide quality and affordable voice, data and internet services. As well as Sierra Leone, LAP holds telecoms licences in six other African countries, including Rwanda, Uganda, Niger, Ivory Coast and Togo.

Competitors Follow Warid as Price War Rages In Uganda

Graphic: New Vision

ZAIN, MTN and Uganda Telecom yesterday announced a reduction in call rates as the tariff war took a new front in Uganda, one of Africa’s fiercest telecom markets.  Last week, Warid drew first blood by dropping call rates to sh5 per second across all networks.  The move by Warid set the stage for a furious price war as the telecom firms tried to outpace each other.

On Tuesday, MTN and UTL declared lower call rates between sh4 to sh5. But Zain quickly outmaneuvered the three by announcing sh3 per second to all networks, including Zain to Zain. It now means that Zain is the cheapest operator, charging sh180 (USD0.082) per minute to all networks. The offer applies to both prepaid and postpaid customers.

Zain
Levi Nyakundi, the Zain marketing manager for usage and retention, said the drop was permanent.  “It is a 66% price drop on the most popular tariff plan - Zain Flexi - which has been sh9 on-net and sh11 off-network,” said Nyakundi.

It was expected that Zain, bought by India's Bharti Airtel, would adopt a drastic pricing model largely on heavily discounted call charges, as happened in Kenya about two months ago, where calls are as cheap as sh81 (Ksh3).

 Uganda Telecom
Uganda Telecom had also turned the barrels to the other operators, announcing a rate of sh4 for calls from UTL to UTL and sh5 for calls to other networks.  According to a statement from UTL’s chief marketing officer, Mohamadou Konkobo, UTL customers will now spend a maximum of sh240 to make a call within the network and a maximum of sh300 to call other networks.

MTN
On its part, MTN announced a “celebration promotion” at sh3 per second on the per-second billing tariff plan and sh160 for calls within the MTN Yellowmax tariff plan. Isaac Nsereko, the MTN chief marketing officer, explained that clients on the per-minute plan will pay sh320 per minute for the first 10 minutes of the day. For the rest of the day, calls will cost sh160 within the MTN network.

On the MTN per-second tariff plan, customers will pay sh6 for the first five minutes, then sh3 per second for the rest of the day within the MTN network. Calls from MTN to other networks remain at sh6 per second all day, which remains one of the highest in the market.

Warid  Telecom
Warid CEO Madhur Taneja, whose firm sparked off the price war last week, said he was pleased that other telecoms were responding to the price reduction. “Reducing call rates is the way to go and the consumers will get value for their money and I hope that every player in the market does so,” he said. Officials from the other mobile telephone companies; Orange, Smile and i-Telecom were not available for comment yesterday.

The current price war is seen as a result of growing competition in the market as well as industry regulator Uganda Communications Commission’s recent reduction of the ceiling of interconnection fees from Shs180 to Shs130 per minute where firms fail to agree bilaterally.

Espionage
It has been a feverish seven days in which telecoms have spied on each other for tariff structures booked with advertising agencies and letters to the regulator, Uganda Communications Commission (UCC), with cancellation after cancellation before final tariff plans were agreed upon.

MTN boasts of about 50% of the market share. It means there are still more calls from MTN to MTN. But the telecom giant now faces stiff competition on voice that will be compounded when Bharti adapts its Asian model, where it has over 100 million subscribers.

In a letter to the UCC dated September 28, 2010, the MTN chief executive officer, Themba Khumalo, said the network had introduced the tariff to celebrate its 12 years of existence in Uganda.   “During these 12 years, we have been at the forefront of making telecommunications affordable and accessible,” Khumalo wrote.  The new MTN tariffs have been launched under the umbrella campaign labelled ‘Yarriba’.

The UCC public relations officer, Isaac Kalembe, said the development is good for the industry.  [Personally] I think we are moving in the right direction because it is the wish of UCC that the rates are reduced,” said Kalembe.

Analysts also believe this plays into the hands of the consumer who has been paying an exorbitant price compared to other regional markets, largely because of the high interconnection fees.

There has not been a response yet from Orange Uganda.  Orange is the most recent entrant to the country's mobile telecom market.

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.

Warid Tariff Cuts Could Open Price War in Uganda

The mobile telephone industry in Uganda appears headed for a new price war after Warid Telecom announced it was slashing the cost of its cross-network calls to Shs5 (USD 0.023) per second.


Warid Uganda CEO Madhur Taneja said yesterday that the new rate, which is half of what the company charged previously, was aimed at reducing the cost of telephone calls.

“High mobile cross-network tariffs have been a barrier to mobile users but we want to break that obstacle by offering the lowest rate in the market,” he said.

The industry average for cross-network calls, which means calls made from one network to another, is around Shs10 per second or Shs300 (USD 0.13) per minute and Warid’s new price, which the firm says is permanent and makes it the cheapest in the market, is likely to draw a response from other players.

Rival firms were non-committal about what kind of response would be forthcoming. Isaac Nsereko, the chief marketing officer of market-leader MTN Uganda, told Daily Monitor  newspaper in a telephone interview that the Shs5 tariff was not a “big deal” and that MTN charges as low as Shs4.5 per second for calls within its network on its discount promotion and Shs5.5 per second to other networks.

Competitors
Ms Cesear Mloka, the marketing director of the second-largest player Zain Uganda/Bharti Airtel, declined to comment when contacted.

However, Zain today introduced a bonus offer where prepaid subcribers earn bonus credit equivalent to 50% of credit recharge.  The bonus can be used only for calls to another Zain line.

Zain Kenya recently led a price war in that market that was followed by a swift cutting of call rates to as low as Uganda Shs75 per minute across all networks. The uniform call rate in Rwanda is about Uganda Shs270 per minute while in Tanzania it’s about Uganda Shs7.5 per second.


The local telecoms industry has already been rocked by the slashing of call rates within networks with different firms charging a flat fee of between Shs1,500 – Shs2,000 for 24 hours of unlimited calls.

Dual phone craze
The higher cross-network call charges have, however, forced many subscribers to buy more than one sim-card to allow them call cheaply within one network and then swap cards when they need to call other networks. It has also boosted the sale of dual sim-card phone handsets.

Warid, Orange and Uganda Telecom are currently offering new subcribers phones whith dual-sim capability.

Uganda Communications Commission, the industry regulator, recently announced a reduction in the ceiling of interconnection fees from Shs180 to Shs130 per minute where firms fail to agree bilaterally.

The industry has also seen a dramatic fall in data prices following the landing of undersea cables on the East African coastline which brought broadband internet, but the competition here has mainly been between MTN and Orange Telecom.

--Daily Monitor

Uganda Gets New Mobile User's Watchdog

A new body has been set up to protect the interests of mobile phone users in Uganda.

A report from AllAfrica.com says that the Mobile Telephone Watchdog will help guard consumers against bad practice by the country’s cellular operators.

Uganda’s wireless sector was home to more than 4.4 million subscribers at the end of June 2010.  MTN Uganda controls around 46% of the market, with Zain Uganda claiming around 19%, and Uganda Telecom and Warid Telecom accounting for approximately 16% each. The remaining 3% is split between Orange Uganda and I-Tel.

Wananchi Gears to Roll Out in Nine Countries With Cisco Deal

Kenyan ISP Wananchi Online has signed a contract with US technology solutions firm Cisco to rollout triple-play services across nine countries in East Africa. The deal is supported by East Africa Capital Partners and Viscous Capital, a wholly-owned subsidiary of Cisco.

Wananchi Online, which claims to be the only triple-play operator in East Africa intends to tap into markets in Kenya, Uganda, Tanzania, Rwanda, Burundi, Malawi, Ethiopia, Sudan and Zambia. The contract will see Wananchi Online deploying Cisco's integrated end-to-end network technology solutions - encompassing its ‘Borderless Networks’ and collaboration and data centre virtualization solutions.

Wananchi intends to extend a backhaul and last-mile fibre network across Nairobi and Mombasa in Kenya and Dar es Salaam in Tanzania. It will also build a WiMAX wireless network to provide uncapped internet access in smaller urban centres in Kenya.

The company will supplement its WiMAX and fibre offerings with VSAT services for small and medium businesses, particularly in remote locations in East Africa. Its long-term plan is to take fibre to the smallest towns in the region. East Africa Capital Partners’ Richard Bell has admitted that Wananchi is keen to develop a network in South Africa too, but: ‘South Africa is still a very closed and regulated market. East Africa has leapfrogged ahead of South Africa. If we could get a licence to build a cable network in South Africa, we’d be there in a second.’

Mark Schneider, chairman of the Wananchi Group commented: ‘The entertainment market for both home and corporate customers in Africa as a whole continues to be reshaped in light of technological advancements and new industry partnerships. The Wananchi Group's key objective is to expand our portfolio and enhance our commercial proposition, revenues and reputation. Cisco will help us to continuously deliver the necessary technology enhancements to our infrastructure to serve our ever-growing customer needs and remain at the forefront of delivering new and innovative services to our customers.’

Executives at Wananchi and Cisco said that the cost of international bandwidth in the region is now as cheap as it is anywhere in the world - thanks to the recent launches of EASSY, SEACOM and TEAMS submarine cables – making this type of increased investment possible.

Bharti To Target Rural Nigeria With USD 600 Million Additional Investment

Indian telecoms operator Bharti Airtel has announced plans to invest around USD600 million in expanding its mobile network in Nigeria, The Economic Times reports.

Last month Bharti finalised the acquisition of the African assets of Kuwait-based Zain Group, in a deal valued at USD10.7 billion. The company has taken over Zain’s operations in 15 countries, including Nigeria, Malawi, Burkina Faso, Ghana, Kenya, Sierra Leone and Uganda.

Manoj Kohli, CEO and joint managing director at Bharti, revealed that the firm will invest in rural telephony in Nigeria and introduce a corporate social responsibility programme that includes setting up of schools that would offer free quality education to underprivileged children in rural communities.

‘We want to be a partner in Nigeria's growth and will work with the government to take the telecoms network deep into all corners of the country to touch the common man,’ Kohli noted.

The Indian company expects to introduce the Airtel brand across its new units by October 2010.