Movicel to expand across province
Angolan mobile operator Movicel is planning to expand its network across central Bie province’s four districts, its director Ablio Fernandes Dias told local press yesterday. He said that coverage will be extended to five new localities in the province in January 2007, with additional districts to follow. In Kuito, the operator has over 3,000 customers and a network capacity of 5,000 lines.
Source- telegeography Wireless Mobile Telecom
Vodacom eyes African opportunities
Vodacom has revealed that it is targeting an expansion to a number of new markets across Africa now that a shareholder agreement limiting its growth has been lifted. Last month Vodacom shareholder Vodafone agreed with co-owner Telkom South Africa to lift restrictions on the cellco’s growth, which had meant it was unable to expand beyond southern Africa. Vodacom is now targeting opportunities in Algeria, Ghana, Nigeria and Angola, according to a report from Cellular News. Vodacom has also revealed that both Vodafone and Telkom will be offloading an equal number of shares to allow a black investor group to take an unspecified stake in South Africa’s largest mobile operator.
Source- telegeography Wireless Mobile Telecom
Cell Operators from St. Pete to Cross the Equator
Russian President Vladimir Putin and Angolan President Jose Eduardo dos Santos are to discuss the entry of Russian mobile operators to Angola’s cell market at a meeting on Tuesday. SV Kapital, set up by a former aide to Svyazinvest’s director general, may become the first on the list. The company is set to put $100 million in the African business. Market watchers believe that MagaFon may join the St. Petersburg operator in the Angolan project.
President dos Santos is meeting Putin on Tuesday to discuss a possible entry of Russian mobile communications operators to Angola’s market, a source of Kommersant reported. Press services of the two presidents declined to comment information on Monday. Unofficial sources report that Putin may ask about issuing a second GSM license in Angola to the Russians.
SV Kapital is reported to be the major contender for the license. The company was established some six months ago by Vladimir Androsik, a St. Petersburg communications top manager. Androsik has worked at Telecominvest, Svyazinvest and its subsidiary Peterstar. The Russian set up his own business in January, keeping in close touch with Telecominvest. Cyrus-registered Eventis Telecom, co-owned by Androsik, set up the second GSM operator in Kyrgyzstan, Bimacom. MegaFon, a major asset of Telecominvest, has consulted Eventis in the Kyrgyz project.
Androsik says Angola is a very promising market with a low level of cell communications coverage and high growth rates.??? The businessman told Kommersant preliminary talks with the Angolan party had already been held but declined to name the companies or agencies. SV Kapital’s founder also said that the budget of the project would come to $100 million.
Angola has 2.3 million cell subscribers, which is 15 percent of the population. The communications market is controlled by Unitel, the sole GSM operator in the country. The number of subscribers in Angola goes up 100 percent annually.
Sources close to the project say that MegaFon might join SV Kapital in the project. MegaFon said yesterday they are not doing the Angolan project of SV Kapital so far.
Opinions have split on the future of Russian operators on Angola’s market. Oksana Pankratova from Comnews Research says SV Kapital follows the example of overseas operators which take risks and enter countries even with low living standards and unstable political situation.???
Quite on the contrary, Yuly Matevosov from Dresdner Bank’s analytical department believes that social and political problems may hamper cell business in Angola. Angola has been living in civil war for a number of years. Besides, examples of other African countries with natural resources-based economies show that stratification of the population there is enormous and a swift rise in demand on cell communications may soon end as most people will be unable to pay for it,??? he says.
Source- http://www.kommersant.com
No cheap call for cellular network acquisitions
RAMPANT acquisitions in the cellular network industry have seen four players grow to dominate Africa by serving 40% of all subscribers.
Yet there are still 115 operators on the continent, providing plenty of fuel for the acquisition frenzy. The largest operators are MTN, Vodacom and the Middle East’s MTC and Orascom.
But the price tag for acquisitions is reaching a point where even the richest Africans may have to bow out and let the oil rich Arabs muscle in instead.
Recent takeovers have cost more than $1000 for each subscriber — an anomaly when Africans are among the poorest, lowest-spending users in the world. Africa has 165-million users and an average penetration of 18%. That means the potential for growth is still there, analysts agreed at the GSM Africa forum in Cape Town last week.
Of 472-million new users expected to join networks around the world this year, 48-million would be in Africa, said Devine Kofiloto, a principal analyst for Informa Telecoms. Yet the growth potential cannot be gauged purely by Africa’s population, as the majority are too poor to afford cellphone services and penetration would stabilise at about 32%, he said. The payback for acquisitions is also taking longer, as the average revenue per user is plunging as cellphones reach the poorer echelons of society.
Nigeria, with 140-million people, is the one country where growth appears almost limitless. Nigeria will surpass SA as Africa’s largest cellular market by next year with 43-million users, compared with an expected 39-million in SA. Even then only 32% of Nigerians would have a cellphone, said Kofiloto.
MTN is enjoying enormous success in Nigeria, and its rival, Celtel, hopes to emulate that after acquiring 65% of V-Mobile for $1,2bn. Celtel CEO Marten Pieters said Celtel was pumping in cash to upgrade V-Mobile’s network, which had stagnated during a legal battle by V-Mobile’s 5% shareholder, Econet, to scupper its sale. We will pump in at least $700m in the next two years. We need at least that much investment to catch up,??? he said.
Nigeria has 30-million subscribers and Pieters believes that will rapidly touch 50-million. In 2011 there will be at least 50 million customers and I think that’s understated. I think customers will at least double in the next three to five years.???
Celtel itself was bought by the Kuwaiti operator MTC for $3,3bn last year, and its oil-rich parent is willing to fund Celtel’s expansion across Africa. Middle Eastern players may be the only ones with the money to continue the merger splurge, Pieters said.
Not only did they have the cash, they also took a longer view on the return on investment, unlike European or African investors that sought a payback in a handful of years.
Even so, the deals were getting crazy, Pieters said, with Etisalat of the United Arab Emirates paying $2,91bn for Egypt’s third cellular licence. A third licence to operate cost more than the market capitalisation of the number-one player there, so you have to ask if that was reasonable,??? Pieters said.
Etisalat bid almost 20% more than the next best offer, prompting MTN to say it would not be goaded into overpaying. Vodacom beat MTN to that conclusion months ago, saying the price of new licences or takeovers was increasingly unrealistic.
Vodacom may soon be allowed to bid for licences or acquisitions north of the equator, as its 50% stakeholder Vodafone is scrapping a restriction that has stymied Vodacom’s expansion. However, its freedom may be too late, given the inflated prices.
Opportunities are bubbling up in Ghana, which may offer a new cellular licence and privatise the state-owned operator. Senegal is issuing a third licence and Angola is also expected to open up to new players.
Meanwhile, delegates to the telecoms conference debated how operators can make more money in poverty-struck markets.
Although watching TV and accessing the internet on a cellphone will gradually become more popular, income from those services will merely offset the declining profits from voice calls.
Operators need to look for revenue from data but let’s not deceive ourselves into thinking data will generate incremental revenue. It will merely offset declining revenue,??? Kofiloto said. He believes most Africans will get their first taste of the internet through mobile handsets. The future of internet access in Africa is definitely wireless,??? he said.
The operators agreed African governments were doing little to help the industry or their people. Rural Africa was not an attractive area to tackle, said Vitalis Olunga, chairman of the GSM Africa interest group. Rolling out services to remote areas needed government participation and regulatory approval to use a mixture of wireless, terrestrial technologies and satellites.
Africa’s cellular networks cover 350-million people who cannot afford to use them, and that would only change when governments removed tax and sales duties on handsets and mobile services, Olunga said.
Increasing the coverage also needed co-operation between rival players, said Gateway Communications CEO Peter Gbedemah. By 2008, calls from one African country to another could be routed directly and not via Europe — as they are now under a legacy of colonial telecoms systems.
Source- http://www.mybroadband.co.za
For Celtel’s Mo Ibrahim, the poorest of the poor are his raison d’etre
Mo Ibrahim: Revolutionising communications in Africa. His tool? The mobile phone
For a man who describes himself as a former Marxist???, Mo Ibrahim has clearly made his peace with the forces of capitalism.
The chairman of the fastest-growing mobile phone group in sub-Saharan African, talks with relish of breaking down the Arab business world’s wariness towards his continent, of cellphones making the internet virtually redundant. Few inventions can boast as dramatic an impact on society as the mobile phone in Africa. Embraced there long before it became commonplace in the west, the technology allows Africans to communicate in spite of fraying landlines, and from areas that colonial-era networks never reached.
Mobiles have helped ordinary citizens free themselves from the grip of the state.
The Kenyan farmer who was once obliged to sell his coffee beans in a fug of uncertainty can now check world prices; the small entrepreneur whose business depended on the whims of a government agency can now operate from any kiosk. Mobiles even play a role in the democratic process, as formerly corrupt officials in remote constituencies are confronted by the vigilant election monitor, phone in hand.
No wonder that Africa is the first continent where mobile phones outnumber fixed lines. Yet that revolution is still in its infancy. When we started in 1998 there were two million cellphones on the continent. Now there are over 100 million, but a quarter are in South Africa,??? says Ibrahim. There’s still a huge amount to do.???
Ibrahim, who has British nationality but was born a Sudanese Nubian, had his brainwave in 1969. Rushing to a screening of Charlton Heston’s epic Khartoum, he jumped into a taxi and became intrigued by the cab radio. ‘How are you communicating?’ I asked the driver.
‘How does the signal reach the car without direct line of sight?’???
This question became the focus of several degrees, and Ibrahim then joined BT, where he played a part establishing Britain’s first mobile network, before setting up an international consultancy firm. But Africa remained his passion, and he was appalled at the assumption among potential investors that the continent was a place where contracts would not be respected. We said to ourselves, ‘Who’s afraid of Africa?’ and set out to do something different, to build a European-quality company with the best equipment . . . which said from the outset, ‘We will not pay a single dollar in bribes’.???
Today Celtel has more than seven million customers, employs 3,500 staff and boasts 120,000 points of sale. While dwarfed by Vodacom and MTN, it is the only mobile network to see the poorest of the poor as its raison d’etre. Such figures leave vast room for expansion and may explain why in May the Kuwaiti mobile operator MTC bought Celtel for $3.4bn, yet left the company free to continue operating as a separate entity.
Ibrahim, a pipe-smoking, compact ball of energy, aims to raise market penetration in Celtel’s target areas to 20 per cent by 2015. He enthuses over the opportunities represented by challenging countries such as poverty-stricken Ethiopia and war-scarred Angola. Up till now everyone has focused on the cities, bypassing villages and hamlets. We want to focus on cut-off rural areas, which is why we are looking at solar energy.???
He does not underplay the frustrations of operating in Africa, expressing exasperation at governments’ love of red tape and their preference for trading with former western masters rather than one another, a damaging legacy of colonialism. He recalls how Celtel challenged the absurd system which dictated that calls between Brazzaville and Kinshasa, two capitals facing one another across the Congo River, were routed via France and Belgium, at international rates.
Interestingly, he is sceptical about the other great change that has swept Africa in recent years: the internet. Computers are very expensive and they need power, and that can be a problem in Africa. SMS text messaging is replacing e-mail and, more and more, phones are carrying out the functions of the computer.???
Ibrahim’s success has given him a huge reach. He is finalising plans for a $100m personal foundation to fund development projects in Africa – investment with a heart???, he calls it. For him, Africa’s salvation lies in private sector efforts, rather than the western-funded, more-aid-please approach favoured by Tony Blair’s Commission for Africa. It’s great that Africa is on the agenda and Blair and Brown are interested. But I’m resigned to doing my own little things in my own little way.???
Source- http://www.vanguardngr.com
