Mobile operator Celtel International, part of the Zain group, has extended its ‘One Network’, the borderless mobile network in Africa, to an additional six countries. These are Burkina Faso, Chad, Malawi, Niger, Nigeria and Sudan. These countries now join the Republic of Congo, the Democratic Republic of Congo, Gabon, Kenya, Tanzania and Uganda in the network which was initially launched in September 2006. All Celtel’s customers both prepaid and postpaid in the twelve countries from East, Central and West Africa, can move freely across geographic borders making calls and sms at local rates. They can top-up their prepaid phones with locally-bought airtime cards. The One Network service is automatically activated upon crossing into any one of the other countries, with no prior registration required or sign up fee charged.
Wireless Mobile Telecom Wireless News
Kuwait-based international cellular group MTC is to continue trading under the Celtel banner in its African operations for the forseeable future. Last week the group decided to change its name to Zain, and rebranded its mobile operators in Kuwait, Bahrain, Jordan and Sudan with immediate effect. Emmanuel Otokhine, public relations manager at Celtel Nigeria, said that keeping the Celtel brand on the continent would ensure certainty and continuity, particularly in the Nigerian and Kenyan operations, which rebranded to Celtel less than twelve months ago. Celtel currently operates in 14 African countries (not including Sudan): Burkina Faso, Chad, Republic of Congo, Democratic Republic of Congo, Gabon, Kenya, Madagascar, Malawi, Niger, Nigeria, Sierra Leone, Tanzania, Uganda and Zambia. The group’s mobile subsidiaries in Saudi Arabia and Iraq are to be rebranded to Zain by early 2008.
Wireless Mobile Telecom Wireless News
Celtel International is considering a major re-branding strategy that would see it drop the ‘Celtel’ brand and adopt a completely new identity - Zain. The plan is expected to create unique difficulties in Kenya and Nigeria, where the Celtel brand is still quite new, as well as across all non-Arab operations. It is part of a long-term strategy by Kuwait’s MTC Group, which owns the mobile telephone operator, to re-invent itself through the launch of a global brand.
MTC, which has expanded significantly through acquisitions, is seeking to consolidate recent growth under one banner. “We have a new brand that will be launched as single global brand for all our operations,” Dr Saad Al-Barrak, MTC’s deputy chairman and chief executive officer, said recently. “We will start any new operation with this new global brand.”
Controversy
Controversy has already erupted over the brand name chosen. Critics feel Zain, leaked in Kuwait in early August, has limited appeal to cultures outside the Arab world. A recent valuation of MTC by analysts from investment banker Morgan Stanley found that Africa accounted for 70 per cent of the company’s fair value.
MTC Chairman, Mr Asa’ad Al Banwan , Celtel International Chairman, Mr Mo Ibrahim, and MTC Deputy Chairman & Managing Director, Dr Saad Al-Barrak. Photo by MTC
The new logo has also been described as too dark and moody. The re-branding process has reportedly begun in Kuwait and is expected to spread to other MTC-branded operations in the Middle East.
Change will come to Africa and its Celtel-branded operations from 2008. The new changes come shortly after a regional marketing blitz to announce the expansion of Celtel’s borderless mobile network to include the Republic of Congo, Gabon and Democratic Republic of Congo. The service was previously limited to Kenya, Uganda and Tanzania. The decision to re-brand will create a costly marketing and logistical challenge for the Kenya and Nigeria operations, given that the two only recently re-branded to Celtel from KenCell and V-Mobile respectively.
The change from KenCell, which began in 2004, is yet to be completed by Celtel Kenya: Many of their telephone booths - admittedly an atrophied part of the business - are still branded KenCell. Nigeria’s switch from VMobile, which began last year, will also have to be scrapped.
A huge task
Speaking to FS during the Second Annual Connecting Rural Communities Africa Forum in Nairobi, Mr Mwaghazi Mwachofi, Celtel International Vice-President for Regulatory Affairs, confirmed that discussions on rebranding were in progress. “Nothing has been decided as yet, nothing concrete,” Mwachofi said when pressed on the matter.
“The Celtel brand is strong and powerful and re-branding is huge task.” MTC Kuwait is also expected to form a new subsidiary, MTC International, as a private company to hold all the MTC Group’s foreign assets and operations.
A newspaper report on the plan several weeks ago saw the Kuwait Stock Exchange halt trading in MTC shares pending clarification of the issues raised.
A local Arabic-language daily had reported that MTC was going to form an entity with $1.73 billion (Sh116 billion) in capital as an umbrella company under which MTC Kuwait and MTC International, called Zain, would operate.
The paper had also said the international unit would sell a stake - possibly 40 per cent or more - in an initial public offering on the London Stock Exchange next year. The re-branding confirms MTC’s ambitions to become one of the biggest mobile operators in the world.
The strategy
According Al-Barrak, the company was looking for a global brand that would work from China to Gabon, in Rio-de-Janeiro and Madras, in Moscow and Iceland. Currently, MTC is looking to fill gaps in sub-Saharan Africa - for example Angola Ethiopia and Senegal - and eyeing Saudi Arabia’s third licence. The company is also making noises about moving its headquarters because of Kuwait’s investor-unfriendly laws.
“The Kuwaiti business environment repels investment and the country’s laws are not good for a financial hub,” Al-Barrak was recently quoted as saying. Kuwait has been dragging its feet on reforms to create a more transparent stock exchange.
Another Kuwaiti law imposes a 55 per cent tax on foreign investors. MTC, Kuwait’s largest publicly traded company, said last week that it could move to Dubai or Bahrain, the Gulf’s financial centres, or to Amsterdam, headquarters of its subsidiary Celtel. The firm operates in Bahrain in partnership with Britain’s Vodafone Group and acquired Netherlands-based Celtel in 2005. It has no presence in Dubai. “MTC is today thinking on the global scale… especially since Kuwait accounts for only 15 per cent of its revenue, (a figure that) will fall below seven per cent in the next two years.” Incorporated in 1983 in Kuwait, MTC now has a presence in 20 countries.
The Group is a leading mobile operator in six Middle Eastern and 14 sub-Saharan African countries providing a comprehensive range of mobile voice and data services to over 29.7 million active individual and business customers.
It operates in Kuwait and Bahrain as MTCVodafone, in Jordan as Fastlink, in Iraq as MTC-Atheer, in Lebanon as MTC-Touch and in Sudan as Mobitel. It also has 14 operations in sub-Saharan Africa as Celtel. These are Burkina Faso, Chad, Democratic Republic of the Congo, Republic of the Congo, Gabon, Kenya, Malawi, Madagascar, Niger, Nigeria, Sierra Leone, Tanzania, Uganda and Zambia. The company has also won Saudi Arabia’s third mobile license and is expected to roll-out a network soon. The change of identity is part of MTC’s plan to re-brand its operations across all networks in line with their “three by three by three (3×3x3)” strategy.
Wireless Mobile Telecom Wireless News
The World Bank’s International Finance Corp (IFC) has announced it will invest USD32.5 million in a fibre-optic cable project that will provide internet and international communication services for 21 African countries. The IFC, the private-sector arm of the World Bank that focuses on investing in emerging market economies, said the cable project should improve telecommunications access for 250 million Africans and cut costs for individuals and businesses. The project, called the East African Submarine Cable System, is to run 10,000 kilometres from the continent’s southern tip to the African horn. It will connect South Africa, Mozambique, Madagascar, Tanzania, Kenya, Somalia, Djibouti and Sudan. A further 13 countries will share the system through land links. They are Botswana, Burundi, Central African Republic, Democratic Republic of Congo, Chad, Ethiopia, Lesotho, Malawi, Rwanda, Swaziland, Uganda, Zambia and Zimbabwe. Mohsen Khalil, IFC’s director of global information and communications technologies, said in an interview the project’s total cost will be USD235 million and said it is a cooperative effort between private and public interests designed to ensure that prices do not fall under monopoly control and rise. ‘Consumers along the east coast of Africa typically pay between USD200 and USD300 a month for internet access,’ the IFC said. ‘As a result of this project, prices for international connectivity will drop by two-thirds at the outset and the number of subscribers will triple.’ Construction is to start within weeks and the cable is scheduled to be in operation by early 2009.
Wireless Mobile Telecom Wireless News
Orascom Telecom Holding has announced that the International Chamber of Commerce (ICC) panel has issued a final decision in its favour, with financial compensation, in the arbitration action brought by Orascom against Sotel Tchad, the Chadian fixed line telco, and the Republic of Chad. The dispute arose from a decision by the Chadian Ministry of Telecommunications to invalidate the transfer of 51% of the shares of Tchad Mobile to OTH despite the fact that a valid agreement was entered into in late 2002 between OTH and Sotel Tchad. As a result, OTH suspended its operation of Tchad Mobile in July 2004. After repeated efforts to resolve the matter amicably with representatives of Sotel Tchad and the Government, and as a last resort for the enforcement of its rights, OTH proceeded with the ICC arbitration.
Wireless Mobile Telecom Wireless News
Celtel extends One Network to six additional countries
