Wednesday, April 30, 2008

Roaming - West Africa

Interview with Ndukwe

Q: You mentioned about borderless roaming for West African countries; from the WATRA’s perspective, last year, there was an issue that NCC was working with other regulatory bodies in West Africa to ensure that across the sub-region, roaming charges are removed. How far with that?

A: Yes, I am particularly interested in that as a person. Nigeria needs it, because our people are very entrepreneurial. They travel across Africa, doing business from one country to another - our people travel a lot- and the big drawback is when you have to keep buying SIM cards from one county to another; this is not something we would like to encourage, so, it would be nice if other companies take example of Celtel- this their One Network plan – so that when people move from one country to another, they ‘re able to use their phones without a problem and they use it as if they are using it from their own home countries.

Tuesday, April 29, 2008

Turkey - privatisation

Preparations completed for Turkish telco sell off

In 2005, the Oger Telecoms group gained a 55 percent stake in Turk Telecom after bidding $6.55 billion in the state tender.

A public offering for 15 percent of shares in Turk Telekom will be held between May 7 and 9, the head of Turkey’s Privatization Administration said Monday.
Haberin devamı

Privatization Administration chairman Metin Kilici said the public offering was aimed at encouraging small scale investors and workers and the amount of shares on offer could be extended to 17.5 percent depending on the response to the IPO.

However, Kilic would not be drawn on whether the price range for the sale, set between 3.90 to 4.70 lira, was too high or too low.

With the sale, the Turkish Treasury will retain between 27.5 and 30 percent of the land line monopoly’s shares.

USA - loyalty from bigger bundles

Despite Higher Costs for Additional Services, Wireless Customers Report Particularly High Levels of Satisfaction with Wireless Plan Upgrades

Wireless customers who subscribe to plans that offer additional services such as in-network calling and unlimited text and picture messaging are typically more satisfied and exhibit greater loyalty than subscribers without unlimited plans, according to the J.D. Power and Associates 2008 U.S. Wireless Contract Regional Customer Satisfaction Index (CSI) StudySM–Volume 1 released today.

The study finds that more than 25 percent of current wireless customers purchase plan upgrades, which typically offer unlimited use of text messaging, downloads, and picture and video services for a flat rate. Overall customer satisfaction with wireless carriers is notably higher among these customers, compared with those whose plans have usage limits. On average, unlimited messaging plan customers are 33 percent less likely to switch service providers in the next year compared with limited plan customers.

“Considering that these plans seem to boost overall satisfaction as well as lower switching intent, it’s not unexpected that more carriers have expanded their unlimited service plan options to include flat-rate pricing,” said Kirk Parsons, senior director of wireless services at J.D. Power and Associates. “Wireless customers who are high-volume users typically benefit the most, as they are more likely to exceed their monthly plan minutes, and unlimited plans solve that issue.”

Wireless carriers also benefit, as typical customers of unlimited messaging upgrades tend to spend almost twice as much on their monthly service than traditional calling plan customers, on average—$92 versus $57, respectively.

The semiannual study measures customer satisfaction based on six key factors that impact overall wireless carrier performance. In order of importance, they are: call quality (32%); brand image (17%); cost of service (14%); service plan options (14%); billing (12%); and customer service (11%). Carriers are ranked across six regions in the United States: Northeast, Mid-Atlantic, Southeast, North Central, Southwest and West.

Verizon Wireless ranks highest in four regions—Northeast, Mid-Atlantic, North Central and West—and performs particularly well in call quality and brand image in each of these regions. T-Mobile ranks highest in the Southwest region, while Alltel ranks highest in the Southeast region.

USA - cable and wireless offers

What's Next for Cable Operators in Their Wireless Future?

The major cable companies Comcast, Time Warner and Cox Communications, recently dropped out of their previously highly-touted Pivot joint venture (JV) with Sprint. This is due to the fact that they could not offer a differentiated service, could not effectively bundle wireless with the rest of their product line, and were essentially competing with the Pivot branded JV.

The three cable companies mentioned above are part of a consortium that also owns AWS spectrum, but lacks a full nationwide footprint. In addition, Cox Communications owns additional spectrum at 700MHz in the southeastern United States. These companies are in discussion with Clearwire, Sprint, Intel and some equipment manufacturers concerning a JV using WiMAX. Comcast has even recently hired a wireless industry veteran. Dave Williams from O2 in Europe, to be its senior vice president of wireless technology.

A couple nice pieces of material and a little flash do not make a $1,000 suit. While these cable initiatives, spectrum investments and hirings seem to point the way to continued interest in and planning for some sort of wireless play, Gartner believes much more is needed.

To be a viable player in this market, U.S. cablecos are going to have to bite the bullet and separately own a wireless company that must be on the same page as them in terms of strategy and direction in the market. They are also going to jump into the industry quickly, because it is already very mature. That means purchasing an existing wireless provider (T-Mobile, Sprint, or the combination Alltel/U.S. Cellular/Leap/MetroPCS) because what they have now will not give them the needed resources to compete effectively. Cable has procrastinated about making a big move into wireless, but time's a wasting, and if they want to get in this market in any meaningful way, they are going to have to write a big check.


RFID applications, impacts and country initiatives

RFID is a promising new technology with a rapidly growing range of applications, many integrating technologies such as sensors. Eight major fields of application are analysed, impacts are discussed and country initiatives described.

Freenet and Debitel

Freenet Buys Debitel; Becomes World's Biggest MVNO

Freenet pays US$2.55 billion for Debitel to become Germany's third-largest mobile services provider.

Global Insight Perspective

Significance - The merger of Freenet and Debitel will create Germany's third-largest mobile services provider and the world's biggest MVNO.

Implications - By merging with Debitel, Freenet has altered the dynamics of its relationship with United Internet and Drillisch, making a buyout of Freenet less likely.

Outlook - Given the aggressive competition in the German mobile market, the merger of Freenet and Debitel heralds the long-awaited consolidation in the market and may help ease the pressure on pricing.

German telecom group Freenet is set to become Europe's largest MVNO after buying rival Debitel in a 1.63-billion-euro (US$2.55 billion) deal from private-equity group, Permira. Freenet sealed the deal on Sunday (27 April) despite strong opposition from major shareholder, United Internet. Following the deal, the combined mobile customer base of Freenet and Debitel will reach 19 million, making Freenet Germany's third-largest mobile services provider, and one of the largest MVNOs in the world.

In a statement, Freenet said its supervisory board approved the purchase, subject to antitrust approval by the German cartel authority. Given that Debitel will be acquired on a cash-free basis with financial liabilities of about 1.135 billion euros, Freenet noted that it will not pay a dividend in 2008. Under the terms of the deal, Permira will receive 32 million new Freenet shares, giving it a 24.99% stake in the company. Permira will also provide a 132.5-million-euro, long-term loan to Freenet and has agreed to a structured lock-in period for its new shares.

Outlook and Implications

* Rumblings within Freenet: The acquisition of Freenet represents another chapter in the ongoing uncertainties over the fate of Freenet. The company's major shareholder, United Internet, which jointly controls 25.24% via its holding company with Drillisch, vehemently opposed the deal and tried to raise its bid price for Freenet. United Internet has been vacillating over launching a proposal to fully takeover Freenet. United Internet had wanted to buy up all of Freenet, break it up, take its DSL business, and allow rival MVNO, Drillisch, to take the mobile operations. Such was United Internet's desire to scupper the Freenet-Debitel deal that, according to Reuters, it offered to raise its takeover bid for Freenet to 16 euro per share from 12.80 euro per share.

* Long-Awaited Consolidation Arrives: Although United Internet and Drillisch are not yet in the picture, the merger of Freenet and Debitel heralds the long-awaited consolidation in the German mobile market. Freenet was born when MobilCom merged its mobile operations and its internet arm, Freenet, in March 2007. In turn, Debitel Germany is the local operation of pan-European MVNO Debitel Group. The company snapped up TDC's German operations, Talkline in June 2007, and in July 2007, sold off its French unit to SFR as part of a plan to focus on the German market. By combining their mobile subscriber numbers, the combined Freenet and Debitel firm will become Germany's third-largest mobile services provider, well ahead of KPN's E-Plus and Telefónica's O2, but still well-short of market leaders T-Mobile and Vodafone. Also, the combined 19 million subscribers make Freenet the largest MVNO in the world, well ahead of Tracfone in the United States. Importantly though, consolidation in the German mobile market may help reduce aggressive competition, lowering the pricing pressures which have affected most of the players.

Mobile instant messaging overtaking SMS

Mobile Instant Messaging to Overtake SMS

According to a recent survey from market research firm TNS Technology, Mobile Instant Messaging (MIM) will overtake text messaging and possibly PC-based e-mail. The TNS Global Telecoms Insight study interviewed 17,000 respondents across 30 countries, and found that once mobile users adopt MIM it overtakes other messaging tools to become the primary non-voice method of interacting.

Among those who use MIM, it is the most used feature on their phones: 61% use it daily, compared to only 55% who use SMS daily and only 12% who use e-mail on their mobiles.

The company also said that instant messaging is taking a larger share of all messaging communications, citing that now 11 out of every 100 messages sent by mobile devices or fixed PC globally are instant messages. However, among MIM users, 36 out of every 100 messages sent is an IM by their mobile, making this the dominant messaging form for these users. Surprisingly, MIM users also use fixed e-mail less with 21 out of every 100 messages sent via this medium, compared to 31 messages among all consumers.

“Once a mobile phone user has access to the Internet from their handset, the cost of instant messaging is next to nothing,” said Matthew Froggatt, managing director of Global Technology for TNS, in a statement. “With consumers being accustomed to instant messaging from their PC, and more mobile operators offering unlimited use of Web browsers, the take-up of MIM is going to increase significantly - leaving SMS and fixed e-mail from PC behind.”

TNS cited that 8% of all mobile users globally currently use MIM, with the highest number of users in Hong Kong (23%). Top cities in China are also seeing a high number of users (16%) with India (15%) and Brazil (10%) following closely.

“There are some notable exceptions to the ubiquity of SMS messages, like the United States where SMS did not take off until relatively recently and Japan where consumers moved straight to mobile e-mail,” Froggatt’s statement continued. “However, where mobile operators have profited heavily from SMS, these findings present a real challenge for their businesses. Do they try and keep consumers focused on SMS to maintain their revenue base, or offer consumers more choice in messaging? With increasing Internet functionality on new mobile phones, and MIM’s strong mass-market appeal, operators may have no choice but to promote this feature more widely.”

UK - digital inclusion strategy

Digital inclusion strategy for UK

A strategy to get the last third of unconnected Britons online is being drawn up, said Paul Murphy, minister for digitial inclusion.

In his first speech since his appointment, he revealed the strategy could be in place by summer. Some 17 million citizens in the UK did not have access to a computer, either at home or at work, he said.

The minister did not set a timescale, but said it would be in line with EU plans to have the gap by 2010.

"Chances are these people come from an older or socially, economically or geographically disadvantaged group," said Mr Murphy. Admitting that he was "not a technical person", Mr Murphy said that he had been studying what was involved in the role since prime minister Gordon Brown appointed him in January. "The more I thought about it, the more I realised that I didn't need to be technical at all. It also became pretty obvious the enormity of the work," he told delegates at the National Digital Inclusion Conference in London.

Mission statement

The new cabinet committee set up by Mr Murphy met for the first time last week. "We came up with the following mission statement: To co-ordinate policies and a coherent strategy that all citizens, especially the disadvantaged, can benefit from new technologies," he told the conference. Delegates welcomed the appointment of the first cabinet minister to have responsibility for digital exclusion. "The vision from government seems now to be bigger and bolder," said Helen Milner, managing director of UK Online centres, community-based groups aimed at connecting the disconnected. Jim Knight, minister for schools and learners, also had an ambitious target for his Children, Schools and Families department. "Our aim is to get access to every household with a child aged between five and 19," he told delegates.

Monday, April 28, 2008

China - Broadband and Internet

China mobile phone user base tops 574 million in March 2008

There were 574.63 million subscribers of mobile communication services in China as of the end of March 2008, growing by 1.66% on month and by 19.55% on year, according to statistics published by China's Ministry of Information Industry (MII) on April 25.

The number of subscribers at the end of March accounted for 41.6% of the country's population (user density).

Also at the end of March 2008 there were 361.06 million fixed telecommunication network subscribers in China, translating into a user density of 27.8%.

In March 2008, mobile phone subscribers in China sent 58.61 billion SMS text messages, averaging 3.32 messages per subscription a day.

China Internet-access user base, March 2008

Internet-access Number of subscribers at end of March 2008

Dial-up (narrow band) 16.74 million
Dedicated lines 64,246
xDSL 56.59 million (Y/Y 37.28%)
Aggregate 71.47 million (Y/Y 27.03%)

Broadband 2.0

Broadband 2.0 Poised to Reshape Web, TV

The advent of DSL and cable modems gave rise to a slew of popular web services, produced multibillion dollar companies and reshaped consumers' daily lives -- all with relatively wimpy "broadband" connections that top out at a mere 3 to 6 megabits per second (Mbps).

Now two of the largest ISPs in the United States are hoping to kick off yet another broadband renaissance, this time with home connections that promise to reach 50-100 Mbps, enabling a slew of high-definition content, better-quality video-sharing sites and even 3-D video. Call it Broadband 2.0.

Experts say this increased bandwidth -- when it becomes widely available -- will have a profound effect on everything from our social interactions on the web to the way we consume media.

"The YouTube philosophy is really the primary motivator here," says Connie Chang-Hasnain, a professor of electrical engineering at the University of California at Berkeley and expert in broadband communications. "Even grandmas post things on YouTube. But, right now, the resolution is terrible and there are some very predefined limits due to bandwidth."

All of that will change with 50 Mbps download speeds, she said, and by simply improving the sound and video quality of video streaming sites, you can dramatically change how a society learns, teaches and communicates.

China - rural Internet

China's rural Internet users more than double in 2007: report

The number of Internet users in the Chinese countryside surged 127.7 percent last year, thanks to double-digit economic growth and fast expanding rural network construction, state media said Friday.

The number of rural Internet users, most of them boys in middle or high school, grew to 52.6 million in 2007, the Xinhua news agency said, citing the China Internet Network Information Centre, a government think-tank.

Due to lower incomes and less education in the countryside, rural users still only make up a relatively small proportion of China's total online population.

China now has 221 million people online, more than in the United States, according to recent reports in the local media.

Among rural residents who have yet to go online, 53.3 percent do not know how to use computers or the Internet, while 23.1 percent lack Internet facilities, the centre said.

India - illegal call routing

Illegal call routing costs govt Rs 145 cr in 3 yrs

Government said on Monday it has lost revenues to the tune of Rs 145 crore (Rs 1.45 billion) due to illegal routing of international calls by telecom service providers during the last three financial years.

Illegal routing of international calls is assessed to have caused a loss of about Rs 145 crore to the government during the last three financial years, Minister of State for IT and Telecommunication Jyotiraditya Scindia said in a written reply to Lok Sabha.

In 2007-08 alone the government has lost Rs 18.26 crore (Rs 182.6 million), he said.

Illegal routing of international calls is done in the guise of local calls by private players, resulting in evasion of connectivity and Access Deficit Charges.

He added the government has set up Vigilance Telecom Monitoring cells with the help of law enforcement agencies to check the routing of international calls.

The government is also setting up a Centre for Communication Security Research and Monitoring, where Call Data Records would be analysed for detection of illegal routing of calls and grey market telecom set up, he added.

To a separate query, Scindia said the government has approved a scheme for establishing 1,00,000 broadband, Internet enabled common services centres in rural areas.

The scheme would entail a investment of Rs 5,794 crore (Rs 57.94 billion) over four years. Of the total, the Centre is estimated to contribute Rs 856 crore (Rs 8.56 billion) and the states Rs 793 crore (Rs 7.93 billion). The balance resources would be mobilised from the private sectors.

Minister said the DoT has sought recommendations of the telecom regulator Trai on the need and timing for introduction of Virtual Mobile Network Operators. The decision to allow VMNO would be taken after considering the recommendations of Trai on the subject, he added.

philippines - rising food prices puts pressure on mobile operators

Rising prices put pressure on texting, phone calls

More Filipinos are expected to own cellular phone units this year, but higher food prices are expected to reduce their spending for calls and text messaging.

“There may be some slowdown in the C, D and E markets,” Edgardo Cabarios, National Telecommunications Commission department director, said. He added that the limited disposable income in this segment will be spent on food.

He said the best way for telecom companies to recover lost revenues from the mass market is to offer a pricing scheme or services that will target the more affluent—those belonging to A, B and upper C socio-economic brackets, as they are likely to have disposable incomes.

But despite higher inflation, the commission official said he sees the number of mobile phone subscribers growing by five million to 10 million this year.

The government earlier reported that inflation rose 6.4 percent in March owing to higher food and oil prices. For this year, the Development and Budget Coordinating Committee projects an inflation rate of 3 percent to 5 percent.

Philippine Long Distance Telephone Co. (PLDT) recorded 30 million subscribers last year, with units Smart Communications Inc. registering 20.3 million users and Piltel, 9.7 million. Globe Telecom Inc.’s subscribers stood at 20.3 million and Sun Cellular’s, more than 5.5 million.

Globe and PLDT have projected lower revenues this year because of higher food prices, the US economic slowdown and strong peso versus the greenback.

Last year, Globe, which is partly owned by Asia’s biggest telco, Singapore Telecommunications Ltd., posted a P13.3-billion profit. On the other hand, PLDT, which is partly owned by Hong Kong’s First Pacific Co. Ltd. and Japan’s NTT group, hit a P36-billion profit. Digital Telecommunications Philippines Inc. reported a net income of P1.17 billion last year.

The country’s three mobile phone operators registered combined revenues of P215.4 billion last year.

Sunday, April 27, 2008

USA - traffic data retention

FBI seeks law forcing ISPs to retain data

The United States' top cop told a Congressional committee this week that law enforcement would benefit from a law forcing Internet service providers to hold onto customer data longer.

In comments before the House of Representatives' Committee on the Judiciary, FBI Director Robert S. Mueller, III told members that Internet service providers (ISPs) should be required to retain the records of what customers did online for longer periods of time. He suggested that records be kept for a minimum of two years, according to a CNET report.

"From the perspective of an investigator, having that backlog of records would be tremendously important if someone comes up on your screen now," Mueller said, according to "If those records are only kept 15 days or 30 days, you may lose the information you may need to bring that person to justice."

The U.S. and European Union government have both pursued longer retention periods to give law-enforcement agents the ability to virtually go back in time and use past actions to build cases against suspected criminals. A year ago, Rep. Lamar Smith (R-Texas) introduced a bill with the stated purpose of combatting child pornography, but which would have required that Internet service providers monitor their users. Earlier this month, participants of the Council of Europe's Octopus 2008 Conference on Cybercrime were asked to adopt a set of guidelines to speed response to cyberattacks and share more information, especially between Internet service providers and government agencies.

The FBI currently rates the policing of the Internet as their third most important priority, following counterterrorism and counterintelligence, according to Mueller's statement. The FBI is a key agency in the Bush Administration's Cyber Security Initiative announced earlier this year.

Mobile - strong demand for handsets

Strong demand for mobile phones

Demand for mobile phones was strong in Africa and Asia

Global demand for mobile phones remains strong, despite economic uncertainty in rich nations and rising food prices in poorer countries.

Consultancy firm Strategy Analytics says 282 million handsets were shipped worldwide in the first three months of 2008, up 14% from a year ago.

The growth was driven by rising demand in markets such as Africa and Asia.

Nokia maintained its dominant position with a 40.9% market share but shipments of LG and Samsung phones grew fastest.

Motorola, Sony Ericsson and Apple lost market share in the quarter.

"Motorola's 10% global market share is at the lowest level since our records began," Strategy Analytics said.

"It is in real danger of being overtaken by LG."

It said Motorola's handsets were "unexciting", while LG's "good looking" and "feature rich" handsets were popular amongst consumers.

Handset market share

Nokia 40.9%
Samsung 16.4%
Motorola 9.7%
LG Electronics 8.6%
Sony Ericsson 7.9%
Others 16.4%

Source: Strategy Analytics

Demand for mobile phones was most brisk in emerging markets, particularly in Africa and Asia.

It said that rocketing food prices in developing countries and the financial crisis affecting richer countries had so far had limited impact on demand for mobile handsets.

Strategy Analytics forecasts demand will continue to rise, but at a slightly slower rate.

It predicts 290 million handsets will be sold in the second quarter of this year, up 12% from the same period a year earlier

Global warming - IT services

Global Warming Initiatives by the Information Services Industry

The first commitment period of the Kyoto Protocol kicks off on January 1, 2008. Under the Kyoto Protocol, Japan is committed to reducing emissions of greenhouse gases by an average of 6 percent by 2012, compared with the levels of 1990. However, Japan's actual emissions of greenhouse gases rose by 6.4 percent in 2006. If Japan were to make up for the difference through carbon emissions trading, it would cost the nation approximately two trillion yen over five years.

The industrial and transportation sectors in Japan are reducing their emissions as part of the nation's initiatives to reduce emissions of greenhouse gases. However, emissions from the commercial and residential sectors continue to rise due to a lack of effective countermeasures in these sectors.

The use of information technology (IT) can have both positive and negative effects on reducing emissions from the commercial and residential sectors. The use of IT can have a positive effect on reducing energy consumption by enabling corporations to conduct activities more efficiently. At the same time, greater use of IT can have a negative effect through the increased use of energy by IT equipment. Some forecasts estimate that power consumption from IT equipment in Japan will increase to five times its current level by 2025. Therefore, Japan must first concentrate on reducing energy consumption caused by the use of IT equipment.

Data centers contain large volumes of IT equipment, and so should endeavor to improve energy efficiency. Accordingly, data centers should deploy high efficiency servers while simultaneously improving their overall energy efficiency. Some data centers in Japan are known to operate at higher levels of efficiency than those in the United States. Japan's energy efficiency technologies could potentially be used for global initiatives to increase energy efficiency.

Japan could eventually set energy efficiency targets for each corporation, which would lead to a scenario under which CO2 emissions could become a limiting factor for corporate growth. Information service providers (ISPs) operate data centers that corporations use to house their servers, and so should endeavor to develop and adopt technologies that improve energy efficiency in order to help corporations overcome factors that could limit their corporate growth. At the same time, ISPs should contribute to addressing the issue of global warming.

Friday, April 25, 2008

India - passing on savings with the end of ADC

Telcos must cut phone tariffs: Govt

The government on Thursday warned telecom service providers of action if they failed to pass on the benefit of withdrawal of levy to consumers.

The levy (Access Deficit Charge), that was paid by private operators to state-owned BSNL for taking up rural telephony, has been wiped off with effect from April 1 this year.

Replying to supplementaries during Question Hour, Telecom Minister A Raja said the phasing out of ADC by sector regulator TRAI would lead to a gain of between Rs 500 crore to Rs 1000 crore (Rs 5-10 billion) to the private firms like Airtel and Vodafone.

The spirit behind TRAI's decision was to benefit the consumers and call tariffs should be reduced, he said.

If the gains are not passed on to consumers, we will take action," he said. Benefit to private operators must reflect on (telephone call) tariffs, he said. He, however, did not elaborate on the action the government may take.

The response was to the allegation by Amar Singh (SP) that companies like Airtel and Vodafone had formed a "cartel" and were profiteering from withdrawal of ADC.

Expressing concern over the impact the withdrawal of ADC will have on Bharat Sanchar Nigam Ltd (BSNL), Raja said the loss to the state-owned firm would be compensated from the Universal Obligation Fund (USO). India does not follow a policy of tariff fixation and rather is governed by the concept of forbearance and market forces.

He, however, said the government was not entirely in agreement with this concept and "if necessary the matter can be taken up with TRAI."

Mobile - 3 billion "coupons" to be sent by 2011

Retailers to Send up to 3 Billion 'Mobile Coupons' to Phone Users by 2011, According to Juniper Research

New figures from analyst firm Juniper Research estimate that almost 3 billion mobile coupons will be issued to Mobile Users by 2011, with just under $7 billion of discounts redeemed.

a coupon sent and stored on a mobile phone that can be exchanged for a rebate, a financial discount etc. at a retailer when the consumer purchases a product.
The new Juniper study finds that mobile coupons are becoming an increasingly important tool for brand owners and retailers to provide a `push to purchase' capability for mobile marketing and advertising campaigns. The key issues driving the move to mobile coupons include:

- Cost savings on campaigns
- An increase in ARPU
- One-2-one marketing opportunities
- An increase in customer retention for mobile operators - lower churn
- Higher conversion rates
- The expansion of mobile value added services
- Reduced fraud

However, Juniper identified some notable challenges for the sector, including a hesitancy from some retailers to adopt mobile coupons. In addition, some retailers would have to change from using laser scanners to optical readers that use the required CCD, technology to read barcodes, especially 2D barcodes from mobile phones.
Other key findings from the report include:

* 2.6 billion mobile tickets set to be delivered by 2011
* Early use of mobile barcode technology will be gradually complimented by the emergence of NFC (Near Field Communication)
* A total of almost $87 billion worth of mobile ticketing transactions by 2011

Thursday, April 24, 2008

Blyk - advertising driven telephony

Ad-funded telco reaches 100,000 clients in Britain

Blyk, a mobile phone service that offers a number of free calls and text messages in return for users accepting advertisements, said on Thursday it had reached 100,000 clients in Britain after six months.

Ad companies and operators are eyeing mobile advertising as an opportunity to generate new revenue streams and they are likely to welcome the news that Blyk reached its 100,000 target six months ahead of schedule.

Blyk said the ad campaigns had generated average response rates of 29 percent, compared with the usual response rates in advertising of just a few percentage points.

The virtual operator is targeting 16 to 24 year olds, renting airtime from Orange (FTE.PA) and using technology from Nokia Siemens Networks (NSN.UL).

"Reaching 100,000 members is significant for advertisers because it gives them the opportunity to engage with a mass youth audience," Shaun Gregory, the head of Blyk's British business, said in a statement.

Blyk, co-founded by Pekka Ala-Pietila, former president of the world's top cellphone maker, Nokia (NOK1V.HE), plans to open the service in several European countries. It has a Netherlands launch scheduled for later this year.

According to a number of studies the mobile advertising market is expected to generate revenues ranging somewhere between $1 billion and $24 billion within four years.

Advertisers are attracted to the sheer scale of the potential audience -- 3 billion people worldwide use mobile phones.

KPN - brings competition law cases

KPN Seeks Redress in Belgium as German Authorities to Investigate T-Mobile and Vodafone

German anti-trust authorities are set to investigate mobile operators T-Mobile and Vodafone following accusations of market abuse by KPN. In a statement, KPN said the German Federal Cartel Office has opened proceedings against the other two players for abusing their dominant position. Similarly, KPN is hoping that the Competition Council in Belgium will adopt the position of the College of Prosecutors on a similar abuse case involving Belgacom’s Proximus unit. KPN had complained to authorities in both Belgium and Germany, asking for a discussion on mobile termination rates, for a fair allocation of frequencies, pricing for fixed to mobile connections, and certain abusive tariff plans by the market leaders. “The actions now taken by the competition authorities both in Germany and Belgium confirm our belief that the dominant providers are engaging in anti-competitive behaviour on both the Belgium and German market,” said Stan Miller, CEO of KPN Mobile International. KPN owns Belgium’s third-largest mobile operator, Base, and German player, E-Plus.

Significance: If the investigation in both Belgium and Germany succeeds, the authorities will most likely impose fines on the operators at fault. KPN will be hoping to use the cases to argue for a better treatment for its units in both countries.

South Korea - Hanaro staff charged

Hanaro Telecom Execs in Mass Indictment

The Cyber Crime Investigation Division of the Seoul Metropolitan Police Agency on Wednesday indicted without arrest 22 current and former executives of Hanaro Telecom, including its former chief executive officer. They are accused of handing over personal information of customers without their consent to telemarketing companies. Hanaro argues it was specified in the small print that customers’ personal information can be used for marketing purposes.

According to the police, from January 2006 to December 2007, Hanaro handed over the addresses, social security numbers and telephone numbers of 6 million customers to over 1,000 telemarketing firms. The information of 490,000 people was used even after they cancelled their contracts. The police also said Hanaro provided personal information of 410,000 customers to a bank. The bank used the information to promote its credit card from October 2006 to May 2007.

The company said while the police argues the names of the 1,000 companies should have been listed in the contract with customers, the company thought a general statement indicating that personal information can be used would be enough.

Roaming - Asia-Pacific call for action

APEC telecom ministers urged to take action on high roaming costs
see also Minister's speech

The issue of high international mobile roaming rates has been elevated to the highest relevant regional forum – the APEC Ministerial Meeting on Telecommunications & Information Industry being held in Bangkok, Thailand this week.

The Ministerial meeting, the first held since a 2005 gathering in Chile, heard yesterday that while there had been some market response to prices, costs were still way too high.

The Australian Communications Minister, Stephen Conroy, told APEC delegations late yesterday that there was a need for an APEC-level response on the issue.

“For individuals and small businesses, international roaming charges are the subject of growing complaints where prices are so high as to discourage the use of mobile phones by people roaming in the APEC region,” Conroy said.

“There is some evidence of market response, but prices remain high for many users. This issue deserves attention particularly as mobile data services grow and businesses come to rely even more on cross-border access.”

Conroy added: “APEC has a strong emphasis on facilitating business, so cross-border communication services should play an important part in the telecommunications sector’s contribution to the regional economic integration agenda. This is even more important as we move into a ‘next generation’ network environment, which will greatly expand the potential of specialised business services.”

High roaming charges has been bubbling as a major issue for regional telecom operators.

Wednesday, April 23, 2008

USA - cable companies and multiple play

Cable companies pull out of joint venture with Sprint Nextel

Three of the nation's largest cable companies are quietly pulling the plug on a joint cell-phone venture with Sprint Nextel Corp., called Pivot.

Spokespeople for Comcast Corp., Time Warner Cable Inc. and Cox Communications Inc. said Wednesday they have stopped marketing the Pivot service and plan in the coming weeks to give their Pivot customers the option of switching to traditional Sprint mobile phone plans.

A spokeswoman for the fourth cable partner, privately held Advance/Newhouse Communications Inc., declined to comment.

Pivot customers will be able to keep their phones and their numbers and receive a month's free Sprint service for their trouble. They'll also be given a set period once they've switched over to cancel their contract without penalties.

Announced with great fanfare in November 2005, the four cable partners and Sprint each invested $100 million in the venture. The Pivot brand was unveiled a year ago.

The partnership's goal was to give the cable operators a "quadruple play" of voice, video, Internet and wireless products in their battle against telephone companies that have added TV to their arsenals.

But the cable companies said the complexity of the offering itself, as well as meshing what was essentially a retail operation with their cable service, made marketing Pivot a chore and controlling the direction of the joint venture difficult.

"We remain committed to bringing a wireless component to our portfolio of services, but we don't believe Pivot was the best option," said Cox spokeswoman Jill Ullman.

The cable companies refused to say how many customers they had signed up through Pivot, but each said it had launched the service in a limited number of markets.

Time Warner Cable spokesman Alex Dudley added that it's still unclear how important wireless services are in keeping customers from jumping to other providers.

"Wireless in some format may be part of our portfolio, but we haven't seen a tremendous demand for the traditional quad play," he said.

Overland Park, Kan.-based Sprint Nextel announced in November that it was halting planned expansions of the service as it sought to make the offering simpler and easier for customers to understand.

Sprint spokeswoman Melinda Tiemeyer said the company has since pulled marketing materials for Pivot from its retail stores in all but three markets.

"The driver was there were operational challenges that made it difficult to sell and bring products to market," Tiemeyer said. "It just wasn't a long-term solution."

She said the company will continue working with the cable providers to find a way to sell wireless to their customers.

Cell-C - profits in South Africa

South Africa: Seven Years On, Cell C Makes an Operating Profit

CELLULAR operator Cell C has turned an operating profit for the first year in its seven-year history, reversing a loss of R349m to post a profit of R321m.

The main fillip to its figures came from a 44% rise in the number of customers to give it 4,8-million, after it launched two cut-price packages to woo more young and talkative customers.

These had been an unprecedented success and a major factor in its turn-around, said CEO Jeffrey Hedberg.

But Cell C still has a way to go before it retains a net profit, with new chief financial officer Fabrizio Mambrini refusing to say when it would finally cross that hurdle. The timing would depend on how much cash it pumped into expanding its network, he said. In the coming two years, capital expenditure would hit R2,4bn, up from R1,2bn spent in the past two years.

Cell C's revenue of R7,5bn for the year to December was up 17% from R6,4bn, while earnings before interest, tax, depreciation and amortisation topped R1bn, surging 236% from just R310m.

The two cut-price deals saw its traffic soar from 400-million minutes a month to 700-million minutes, forcing it to expand its coverage and quality to meet demand. It now carries 87% of its own traffic, but still roams on Vodacom's network in areas where it is not financially viable to set up its own.

Hedberg said 2007 was a "defining year" when Cell C stopped trying to emulate its dominant rivals MTN and Vodacom by being all things to everybody. Its new strategy had been to create simple, affordable packages so more previously untapped consumers signed up and existing customers could afford to make more calls.

Mambrini said attracting young customers with less money to spend initially gave it a lower average revenue per user, but it was an investment for the future if it could retain their loyalty as they grew older and wealthier.

Cell C is 60% owned by Saudi Oger, 25% by empowerment investors CellSaf and 15% by Lanun Securities, another Saudi firm. One potential move that could drastically change its future is if its sister company Oger Telecom bids for a controlling interest in Telkom. Telkom and Cell C would then work closely together to offer combined fixed and mobile services.

A tie-up with Telkom would give Cell C scale in distribution, advertising and on its balance sheet, Hedberg said.

"I know it could make a good deal of sense and Saudi Oger is very keen on interacting with the stakeholders to see if it can drive a win-win deal."

Telkom said this month that Oger had not returned with a firm offer after its initial overture was rebuffed.

However that pans out, Cell C is focusing on gaining subscribers more cheaply by reducing the commission it pays airtime resellers. That was a fine balance that demanded high volumes of customers, so resellers were still willing to offer Cell C rather than score higher commission by selling MTN or Vodacom instead, Mambrini said.

Other aims for this year were to launch more customer-friendly packages and improve its network quality and customer service.

WTO - services liberalisation

Africa: Lamy Pushes Ahead With Services Liberalisation

World Trade Organisation (WTO) Director General Pascal Lamy announced at the end of last week that there will be a limited ministerial "signalling" conference on services trade chaired by himself.

No dates were given but it is expected that it will take place with a mini-ministerial meeting planned for May 19 which deals with the issues of non-agricultural market access (NAMA) and agriculture. He indicated that senior officials will already begin negotiations in Geneva on May 5. Most in Geneva, however, do not believe that this timeline can be met.

The "signalling" conference will focus specifically on market access: participants are expected to "signal" to each other the extent to which they are prepared to liberalise their services sectors.

According to Lamy, "any outcome on market access among participants in the plurilateral process will be automatically extended on an MFN (most favoured nation) basis to all members". This comment has worried many developing country negotiators.

"Plurilaterals" refer to negotiations between a subset of WTO members. The outcomes of such talks are, in theory, only binding on those members. MFN refers to each member state granting trade advantages equally to all trading partners.

He also said that "participation in the signalling conference would be, more or less, among members participating in the plurilateral request and offer negotiations, plus representatives of regional groupings -- all in all, similar to the format of the ministerial Green Room."

This would mean that only the developed countries, the emerging developing countries and a few others will be included in these meetings. These are the countries that account for most of world services trade. The bulk of WTO members, however, would not be involved.

As chairperson of the signalling conference Lamy said he would provide an oral report to the trade negotiations committee, where he made the announcement on April 17.

The main elements of the report would include "a description of the sectors and modes of delivery discussed and the signals exchanged regarding new or improved commitments which participants would be ready to undertake". The conference will probably last one day.

In the corridors of the WTO there was great unhappiness about this signalling conference by those who have been excluded from the small group services meetings and who will not be party to the conference. Many are worried about the implications for their countries.

One African delegate, whose delegation is not involved, spoke to IPS on condition of anonymity, given the sensitive nature of the issue. He said that "the conference is being pushed by the developed countries. Even though we are not involved, our fear is that what they agree among themselves will impact on us.

"This can happen in two ways. One, the outcome can be used as a benchmark for other members who are not participating.

"Second, we cannot refuse or oppose other members from coming together. However, what is the implication in terms of the multilateral process when we have the secretariat directly involved? The director general (DG) is chairing the meeting himself. The involvement of the DG (undermines) the neutrality we expect of the secretariat".

He went on to ask, "will the DG then say, the plurilateral group has achieved this. Those who have not participated, can you achieve two-thirds of what was achieved?"

Services trade is of major interest for both the U.S. and the European Union (EU). There has been intense lobbying by U.S. and EU business groups in Geneva in recent weeks.

What could happen -- and this would be very dangerous for all countries, including those who are not participating -- is that the conference becomes the starting point for "sectoral" negotiations. Sectoral negotiations constitute the formalisation of negotiations on specific services sectors.

It takes place when there is a "critical mass" of countries involved, as was the case after the Uruguay Round in telecommunications and financial services. "Critical mass" refers to the countries that contribute to most of the trade in that sector. The eventual outcome is a common template of liberalisation in each sector under negotiations.

This regulatory template or framework tends to put liberalisation, "pro-competitive" objectives and the rights of foreign firms ahead of national objectives such as universal provision of services. This may therefore not advance developing countries' interests.

In 2004, the WTO's dispute panel ruled against Mexico in a case brought to the WTO by the U.S.. The U.S. said that Mexico's regulations were anti-competitive and contravened the Telecoms Reference Paper -- the regulatory framework that resulted from the telecommunications sectoral negotiations.

The panel ruled that Mexico had failed to provide American basic telecommunication suppliers with equal access to and use of public telecommunication networks and services. The Mexican company Telmex had charged the U.S. supplier higher interconnection rates.

Mexico tried to defend its regulations on the basis that they were designed to include the costs for rolling out telecommunications infrastructure, a need of many developing countries.

The panel, however, accepted the U.S. argument that the rates charged should be based solely on the specific services foreign companies required. No contribution to the development of Mexico's telecommunications infrastructure could be included in the rate because Mexico had adopted the Reference Paper.

Even though countries may choose not to sign on to such a regulatory template, once such a template has been adopted by a "critical mass" of states and it is formally part of the multilateral framework, there is a de facto, hidden obligation on all.

In theory, the countries that are non-signatories can ignore such a "benchmark". However, in practice, bound under international law, it becomes a minimum norm which would be used by foreign investors and trading partners to evaluate countries. This norm will be seen as the minimum guarantee to protect their interests.

Ghana - 6th mobile operator

NCA forges on with ‘beauty contest’ for sixth mobile licence

The Ghanaian telecoms regulator, the National Communication Authority (NCA), is said to be ploughing ahead with plans to license a sixth mobile operator in the country, contrary to earlier rumours that the process had been suspended on the advice of the government, pending the privatisation of state-backed PTO Ghana Telecom. However, local online newspaper Myjoyonline quotes the Director General of the NCA, Bernard Aidoo Forson, as saying that the state has not advised any such thing and that the licensing process is still under way. Forson added that no fewer than eleven telecoms operators and companies including Afritel Communications, Awesomedia, BenchMac PR & Business Consult, Express Mobile Communications and Faith Telecom are considering bidding for the licence on offer. Other possible bidders are believed to include Global Trade Imex, Glo Mobile Ghana, a subsidiary of Globacom of Nigeria, TechnoEdge Ghana, Teylium Telecom International, TransAtlantic Industries and Warid Telecom International. All of the eleven companies named have been short-listed to take part in a 'beauty contest’, the outcome of which will be announced by mid-June.

Movies on cellphones

Full-length shows, even movies, growing on cellular

Forget short clips and "mobisodes." Cellphone providers are ramping up their full-episode TV offerings, from Lost to The Office, and even movies.

And the viewing experience on your phone is improving to near-broadcast-quality video (though tiny) that you can watch while waiting for the bus or in between meetings. "I definitely see it growing, especially here in the USA where, let's face it, we Americans like our video," says Forrester Research's Charles Golvin.

Today, only about 7% of mobile subscribers (cell and data) watch video on their phones, he says. But the industry is poised for major growth: Mobile video revenues at domestic carriers jumped to $308 million in the last three months of 2007 from $112 million in the same period a year earlier, according to Nielsen Mobile.

"If the pricing is reasonable, the experience is good and the selection of content is robust enough (and) it really behaves like TV, you're going to see wide adoption," Golvin says.

The latest cell provider to upgrade its television viewing options is AT&T; its live Mobile TV service launches next month with channels from CBS, Fox, NBC, Comedy Central, ESPN, MTV and Nickelodeon. AT&T customers who get one of two new phones capable of receiving the service - the LG Vu and the Samsung Access (no prices yet on phones or subscription costs) - will be able to watch full-length episodes of shows such as Lost, Grey's Anatomy, Entourage and 30 Rock. AT&T Mobile TV users also can tune in to PIX, a new movie channel from Sony Pictures that will air movies such as Bugsy, Ghostbusters, The Karate Kid and Groundhog Day.

The AT&T/Sony channel is not the first movie-cell connection. Sprint began making movies available on demand in September 2006. Earlier this month, Warner joined Sony, Paramount, Disney and Lionsgate with movies on the provider's network. "Everyone is really, really skeptical about who would want to watch movies on a little cellphone, but we are very pleasantly surprised," says Disney's Ron Schonfeld. "We entered it initially as an experiment, but we're seeing it's a real business."

Asked whether he ever thought he would see TV and movies on cellphones, 22-year industry veteran Mark Collins, vice president of consumer data at AT&T's wireless unit, says, "With networks and content distribution and devices evolving the way they are, and customers' never-ending desire for wireless experiences, nothing surprises me today."

Offerings of simulcasts and specially repackaged TV content began in 2003, when Sprint added MobiTV, a Berkeley, Calif., service then providing a dozen or so channels, including MSNBC. In 2005, Cingular (now AT&T) added the MobiTV service, which has continued to expand, adding the Disney Channel earlier this month. Verizon launched V Cast in 2006 with channels including CBS, Fox, NBC and ESPN delivered through Qualcomm's MediaFLO service. It is MediaFLO that AT&T is adding in May.

A recent viewing of Verizon's ESPN channel produced live NBA playoff video of high-enough quality to identify various players, although the scoreboard below the video was hard to read. Action was only a second or so behind the satellite TV broadcast.

Cell providers began offering episodes on demand about a year ago. Sprint's 70 "channels" include streaming video from CBS and other networks, plus more than a dozen shows, such as Desperate Housewives and CSI: New York, with usually the previous four episodes available.

"If you are on your lunch break or if you are sitting in your car waiting for your kid at soccer practice and want to watch a chapter or two, you can do that," says Sprint's Aaron Radelet.

Mobile users are willing to watch for extended periods, says Nielsen Mobile's Nic Covey. Nearly half (47%) say their average session lasts 15 minutes or longer; 25% watch 30 minutes or more.

Says Covey: "Enough consumers watch mobile video for those lengths of time and enough consumers are interested in name-brand programming that this level of mobile viewing could be just as big an opportunity as clips."

Australia - wireless broadband

Wireless operator plans Australian nationwide WiMax network

Australia's 20 biggest cities could be covered by a A$500 million ($467 million U.S.) commercial-grade mobile WiMax network within two years.

The network will be modeled on the Sprint Nextel WiMax initiative in the U.S., in which Sprint Nextel Corp.'s Xohm unit, Intel Corp., Samsung and Nokia Siemens said they will cooperate to deploy mobile Internet access to some 100 million people by year's end at a cost of $5 billion over three years.

Joe Nardone, Intel's global general manager of WiMax business development, told Computerworld that Unwired has mapped out plans for a national mobile WiMax network, including cost estimates, technology road maps, and potential customers and partners. Intel is an investor in Unwired.

Unwired's current wireless technology does not allow it to deliver mobile access -- in other words, users cannot sit in a moving train or car and receive a constant signal. However, this will change when it migrates over to WiMax, where mobility is inherent in the technology.

The WiMax network will help the Seven Network's plan to reinvent itself as a digital company by providing a medium for the delivery of broadband, voice over Internet Protocol and television. Seven purchased Unwired outright for $127 million last year.

Seven could provide funds for the required network infrastructure in a deal that Nardone describes as a "leap of faith."

Telecommunications analyst Paul Budde said the Seven Network's plan to become a "digital company" through its engine, Unwired and TiVO businesses will result in a failed overbuild of technology.

"I have looked at this from 15,000 angles and the idea simply can't work," Budde said.

"Both engine and Unwired are in trouble and are underperforming, so if [Seven] can bring these together, they deserve a Nobel Prize for innovation."

The mobile WiMax network will not be able to compete with Telstra's established 3G network, according to Budde.

He said Telstra's established customer base will have no reason to migrate to the six-year-old technology, which Budde believes is inferior to 3G's High-Speed Downlink Packet Access, platform.

Unwired will have a tough time recouping ROI as competition from Optus and Vodafone Group PLC's 3G networks drives down access prices, Budde said.

Unwired refused to comment for the story

Europe - roaming charges factsheet

EU Roaming Regulation : Using your mobile abroad in the EU is now much cheaper

The EU Roaming Regulation has lowered charges by up to 60% for consumers using their mobile phones abroad in the EU. The Regulation entered into force in July 2007 abolishing one of the last borders in Europe's internal market: restrictive tariffs for pan-European mobile communications. The Regulation does not fix an ideal price for roaming charges, but ensures that mobile roaming voice charges are not unjustifiably higher than at home.

Tuesday, April 22, 2008

India - Merger control

Govt announces M&A norms for telecom licences

The Department of Telecommunications (DoT) has significantly tightened the rules on mergers amongst telecom operators within a circle by imposing a three-year lock-in period and making it mandatory for them to take prior permission from the ministry. It has also made the rules on retention of spectrum after the merger much more stringent.

According to the existing policy, operators do not need prior DoT permission or have a lock-in period for merging.

Experts, however, say the new policy will not benefit anyone and will only block consolidation in the industry, which will already have too many players in the market. Says telecom analyst Mahesh Uppal: “It is bit of a mess for everyone — existing players will be hit as they cannot buy now for three years; new players would not be able to sell; and it will not help the consolidation of the industry, either”.

A similar view is echoed amongst operators too. A senior member of the Cellular Operators Association of India — the GSM lobby— said: “The policy does not benefit anyone. New players cannot cash out; consolidation of the industry, which has been the new cry, has to wait; and the existing operators, who were looking for mergers as a way to get extra spectrum, will be confronted with stringent rules on its utilisation.”

However telcos also say that in many areas the policy lacks clarity. “It says that there is a three-year lock-in on mergers for new licencees but it is quiet on the possibility of an operator acquiring a company, taking a majority stake and waiting for three years. What stops them from doing so? The word acquisition is conspicuous by its absence” asks an existing operator.

The government has recently awarded licences to over six new players, including Datacom Solutions (promoted by Videocon group), Loop Telecom part of the BPL group controlled by the Ruias and their associates, Swan Telecom, S-tel, the Unitech group, among others. Even Reliance Communications and Tata Teleservices (which are in CDMA) have been given permission to operate GSM services under the new policy.

The new merger rules are based on the recommendations made by the Telecom Regulatory Authority of India (Trai). In line with the regulators recommendations, DoT’s merger rule also limits the market share of the merged entity — both in terms of subscribers and revenue to 40 per cent. Under the prevailing rules it is 67 per cent. That is understandable as the number of operators in each circle is expected to go up from 5 to 6 now to over 10 to 12. For a similar reason, the new policy states that merger and acquisition activity cannot be undertaken if there are less than 4 players in the circle. Under the current policy, the rule is of 3 operators.

However the new policy deviates in two key areas from the regulator’s recommendations — the existing rule under which a telecom operator cannot take more than 10 per cent equity stake in rival operators in the same circle will continue. Trai had suggested that this limit be raised to 20 per cent.

Also DoT has removed the regulator’s suggestion that mergers can only be allowed if operators have met their rollout obligations.

The new policy, of course, has made retention of spectrum tougher. While it allows the merged entity to be entitled for the total amount of spectrum held by the merging companies, it puts in a stiff rider — the new entity has to meet the subscriber criterion within 3 months or surrender the licence. And in case some spectrum is still held by the merged entity after the expiry of 3 months the charge for it will be doubled every 3 months

Broadband - rural Europe

Rural Europe Left Behind on the Net

The EC says while many now have access to the Internet, 40% of Europeans do not use it at all, with urban residents more fully connected

Out of the half a billion EU citizens, more than 250 million regularly use the internet, according to newly released figures.

A European Commission report on the results so far for i2010, the EU's digital-led strategy for growth and jobs, further showed that of this number, 80 percent have access to some form of broadband connection.

Additionally, says the report—released on Friday (18 April) some 60 percent of public services in the EU are fully available online, with two thirds of schools and half of doctors making use of high-speed internet connections.

"It is a welcome change of political direction that today, information and communications technologies, the main driver of European growth, are being promoted by all 27 EU member states in their national policies," said Viviane Reding, EU information society commissioner.

"However, some parts of the EU are still lagging behind and are not fully connected," she warned.

The report notes that nearly 40 percent of Europeans do not use the internet at all. While in Denmark only 13 percent of the population do not use the internet, Romania is at the other end of the scale with 69 percent of its population offline.

The report notes that the EU-wide average for DSL broadband penetration is nearly 90 percent (DSL networks are used by 80 percent of EU broadband subscribers, and so are used as a proxy by the report's analysts for broadband more generally, although cable and wireless broadband services do also exist).

However, the report also says that figures for national broadband coverage also "hide a gap between rural and urban areas in several countries," noting that full coverage remains a challenge in a number of countries.

Greece, Slovakia, Latvia, Italy, Poland, Lithuania and Germany show "a large gap", between coverage in urban and rural areas.

Germany has a broadband coverage rate of 94 percent overall, but only 58 percent of rural areas have access to high-speed internet.

Greece, with its island geography comes in last on both scores, with under 20 percent of the country being serviced with broadband, and only ten percent having access in rural areas.

Wherever this rural-urban split happens, it is due to difficulties and increased costs involved with the provision of new technologies to areas with challenging topographies and population densities that make offering these services unattractive to companies that sell internet access.

UNI Telecom, the international union federation representing telecoms workers, argues that this is where the market liberalisation in the telecommunications sector is shown to fail, as private firms cherry-pick urban, population-dense and wealthy areas to build service infrastructure.

In the past, they argue, public service provision would have used the 'postage stamp' model where profitable urban areas subsidise the more expensive provision of service to rural areas.

The current situation however leaves rural, remote and poor areas with substandard service or even none at all, says the union. Urban zones with high concentrations of elderly citizens, who can have less of an interest in the internet, are also sometimes underserved.

A commission spokesperson conceded that this is the case, but countered that this is why EU rules on state aid permit public financing or partnerships to deliver broadband or other new technologies to such areas, ensuring universal service provision.

Pacific - oversupply of cable capacity

Undersea cable boom may create capacity oversupply in Pacific, says TeleGeography

The undersea cable business continues to be stuck in a cycle of feast, famine, and feast again, according to new data from TeleGeography. The Global Bandwidth Research Service reports that the undersea cable business is in the midst of a new investment boom, seven years after the first boom flooded the market with excess capacity. Even now, less than 25 percent of potential capacity on existing subsea cables on major subsea routes is active.

TeleGeography projects that at least 25 new cables, costing approximately $6.4 billion, will be constructed between 2008 and 2010 -- and this figure is likely to rise as plans for a number of other proposed cables solidify. The investment boom is global, with new cables planned for every regional market, with the exception of the Atlantic.

For once, dwindling capacity is not the only reason for the new wave of construction. Rather, new cable projects are forming out of a need for a broader range of restoration options in case of cable failures, the desire for more diverse routes between two destinations, and stubbornly high capacity prices in markets that have ample capacity but few competitors. While most cables are being built in response to individual carriers' business needs, there is a real risk of oversupply in both Africa and across the Pacific.

The rapid expansion of network construction also presents a challenge for the equipment makers that are building these cables. After lying fallow for almost half a decade, equipment vendors are suddenly having to ramp up production to meet surging demand. However, these suppliers are keenly aware of the cyclical nature of the submarine cable industry and wish to avoid being left with excess manufacturing capacity once this building boom wanes.

Russia - hoping to expand into Asian markets

Russian Telcos Look to Asia for Growth

After a decade of rapid advances in the former Soviet Union, Russia's mobile operators are placing big bets in India, Vietnam, and elsewhere

The Russians must know a thing or two about mobile telephony. After all, few countries in the world have seen such a dramatic explosion in mobile-phone usage: The number of Russian subscribers has risen to 170 million today, up from just 1.35 million in 2000. That phenomenal growth has been good news for Russia's leading telecom companies, now among the largest and financially strongest in the world. But there's one obvious downside. Now that so many in Russia have mobile phones, where do the nation's telcos go for growth?

The answer, it turns out, is Asia. In recent months, Russia's leading mobile operators have made their first forays outside the former Soviet Union. They're pinning their hopes on the fledgling telecom markets of southern and southeastern Asia, where Russian companies have recently announced plans to invest billions of dollars.

So far the most ambitious plans are those of Sistema (AFKS.RTS), a Russian conglomerate that owns Mobile TeleSystems (MBT), known as MTS, Russia's largest mobile-phone operator. Sistema has recently been causing a stir in India, becoming the latest international heavyweight to join the Indian telecom race. "Of course, India was always the top priority because of its market size, population, economic growth, and other factors, including a very good [historic] relationship between the Soviet Union and India," says Anton Abugov, a vice-president at Sistema and member of the MTS board of directors.

Monday, April 21, 2008

China - Internet leader

China vaults past USA in Internet users

China, already the world leader in cellphone use, has surpassed the USA as the No. 1 nation in Internet users.

The number of Chinese on the Internet hit more than 220 million as of February, according to estimates from official Chinese statistics by the Beijing-based research group BDA China. The government is likely to confirm the leap at its half-yearly report in July.

The longtime Internet leader, the USA, which founded and developed the network of computers, had 216 million users at the end of 2007, according to Nielsen/NetRatings.

The percentage of American users - 71% - still exceeds China's 17%. China has 1.3 billion people, compared with nearly 304 million in the USA.

China, however, has a higher growth rate, says BDA's chairman, Duncan Clark. By the end of March, for example, Chinese users climbed to 233 million.

At the end of 2007, China's Internet users reached 210 million, a jump of 53% from the previous year, says Zhang Shanshan, media director for the China Internet Network Information Center, which gathers statistics for the Ministry of Information Industry.

Clark says the rapid growth is powered in part by China's economic boom. While the government "continues to filter the Net and encourage self-censorship, it also has a mandate to promote cheaper technology and the knowledge economy."

And there is strong government backing for companies such as China Netcom, which offers broadband service at $10 a month, Clark says.

At the company's Xibahe branch in north Beijing, dozens of people recently lined up to buy broadband service.

Sun Xin, 19, a student, was helping his parents sign up for DSL.

"My friends all agree - no Internet, no life," Sun says. "We use it every day for MSN, and I love playing games like World of Warcraft." The game is so popular that players can pay companies in China to play in their place so they can continue gaining points.

Europe - reviewing i2010

Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions
Preparing Europe’s digital future - i2010 Mid-Term Review COM(2008) 199 final

The i20102 strategy, launched on 1 June 2005, was the first coherent policy framework for the era of convergent telecommunication and media services. Much progress has been made in the past three years. A few examples suffice to show the breadth of achievements: a new regulatory framework for audiovisual media services is in place; proposals to reform the regulation of electronic communications have been launched; regulation to create a single market for mobile phone use across borders is in operation; initiatives to boost online content in Europe are under discussion; major new R&D and innovation funding initiatives are up and running (the Seventh Research Framework and the ICT Policy Support Programme under the Competitiveness and Innovation Programme — CIP); ground-breaking public private partnerships (Joint Technology Initiatives) have just been launched; and new eInclusion initiatives are on track.

The current assessment of the Lisbon Strategy6 shows that structural reforms are starting to pay off, but the economic landscape is fragmented. This overall picture is also true for the information society. While the 2007 Strategic Lisbon Report confirms the prominence of ICTs in structural reform and half of Member States have strengthened their R&D and ICT policies, many parts of the EU still lag behind in adopting ICTs.

The following issues are thus becoming strategic for competitiveness and ICT take-up in Europe:

• Europe has made big progress towards the networked economy, but it needs to shift up a gear to lead the transition to next-generation networks while not slacking off in its efforts to overcome the digital divide.
• Europe should take better advantage of its number one economic asset, the largest
consumer market in the developed world; however, despite the global spread of the
Internet, further steps are needed to create a Single Market for the digital economy.
• ICT research expenditure is still below target in most Member States. Greater efforts are needed to pool resources by coordinating research and innovation efforts.
• As the Internet permeates daily life, public expectations and concerns about the
information society are changing. Safeguards need to evolve to match technology and
market developments, without stifling the huge opportunities that online social and
economic activity offers.

UK Cardiganshire - blackspots

County 'notspot' broadband survey

A survey has been launched in Ceredigion to gauge how many residents have access to broadband.

Ceredigion Council said its Notspots project also aimed to identify areas with poor mobile telephone reception.

Last year regeneration group Mid Wales Partnership said black holes in rural Wales' network put it in danger of falling behind the rest of the UK.

In neighbouring Powys there have been calls for an inquiry into "unacceptably low" broadband access.

Mark Elliott, assistant director of the council's corporate performance, urged people in Ceredigion to take part in the survey.

"Having a high-speed broadband internet connection means the death of distance as you can begin to access many services online," he said.


"I urge all citizens to complete the survey form so we can establish whether there is a digital divide occurring and where it is."

In October last year Mid Wales Partnership, which is now known as the Central Wales Economic Partnership, said there was "urgent planning and investment" needed to improve high speed internet connection.

It said there were "notspots" unable to get broadband of any description.

But British Telecom said at the time that more than 99% of people in Wales could access broadband, although a small number could not, and it was working with the assembly government on the problem.

The Welsh Assembly Government has said previously that its regional innovative broadband support project was in talks with the telecommunications industry to "determine appropriate, cost-effective solutions for providing broadband" in blackspot areas.

Australia - mobile Internet too expensive

Majority of Australians Say Mobile Internet is Too Expensive

A new survey commissioned jointly by the Australian arms of Sony Ericsson and Hutchison 3G (3) has shed light on the consumer's view of the internet on the mobile. The report said 96% of people said they want mobile internet access, and more than half (53%) say they need internet access outside of work or home, but 91% of people still see barriers in doing so, including a perception of high costs and a poor user experience.

The survey found if more Australians had cheap and easy web access on their mobile 80% would spend more time online, with 66% of respondents saying their internet usage would increase by up to four hours each week.

"This survey reinforces what I've long suspected - as Australians' become evermore mobile, there is a clear need for reliable, efficient and cost effective access to the internet and a variety of online applications on mobile devices," stated Peter Blasina, an Australian consumer technology expert. "2008 will be about mobile web browsing and it being at the centre of the ongoing evolution in communication."

Adoption of Mobile Web Technology

The survey also reveals the need for web access on mobiles does not support generational stereotypes, and accessing the internet on the move isn't just for the young. Of respondents there is only a slight margin of difference (12%) between those aged 16-24 years old and those aged 25-49 year olds that say they would increase internet usage if they used on a mobile device.

"Proliferation and uptake of the internet on PC was the driving force behind Sony Ericsson re-designing the mobile web experience," stated Josh Oxspring, Head of Marketing, Sony Ericsson Oceania. "With products specifically designed to mirror the PC internet experience, such as is found in the recently announced Sony Ericsson K660i, our handsets overcome barriers to bring mobile web browsing to the masses. Web browsing on a mobile is now officially easy and fun."

Driving Usage of Web on Mobile

In regards to sites people would access from a mobile phone, the survey indicates search engine sites (76%) and email (74%) were the most valuable to access on the move. Other popular sites to access include timely, up to date news and current affairs (63%) as well sports sites (34%).

"3's customers have been heading to the internet on their mobiles since 2006 and its value and a good experience that's the key. As consumers we won't tolerate a poor online experience at home or work, and we won't on the mobile either," says Christina Ferve, Head of Content at 3. "2008 in our view is certainly a year where the mobile internet will continue to grow, through a combination of higher awareness from consumers of what they can do on their mobile, and devices with browsers that support a better experience."

*The survey was carried out by a third party in March 2008, surveying 653 Australians aged 16-49 across all states. Interviews were conducted using CATI (computer assisted telephone interviewing) with telephone numbers randomly selected from electronic White Pages. Age, sex and region quotas were applied to the sample and, following the completion of interviewing, the data was weighted by sex and area to reflect the latest ABS population estimates.

Kosovo - growth of mobile

Ipko hits quarter million target

In the four months since it launched a GSM network in Kosovo, Telekom Slovenije-backed cellco Ipko claims to have sold 250,000 SIM cards. Ipko now operates over a network comprising 150 base stations with coverage of 76% of the population and 52% of the territory. By the end of 2008 the company hopes to have doubled the number of base stations and increased its customer base to 550,000. Within five years it expects to achieve a 50% market share with around a million subscribers. Ipko offers a variety of packages aimed at specific user groups, and claims to offer a number of innovative services, including a credit transfer option for pre-paid users, which allows subscribers to make calls even if there is not enough credit on the phone. Including the licence fee, Telekom Slovenije has invested over EUR100 million (USD158 million) in IPKO’s mobile network, approximately half the total planned spend.

Enterprise Mobility - security threats

ScanSafe data confirms what security professionals have long feared - roaming workers up to no good on web
see also white paper

In data released today, ScanSafe has confirmed the long held belief that employees are engaging in risky web surfing when working outside the office. The company found that roaming laptop users are much more likely to try to access illegal file sharing sites, porn sites and other questionable content putting employers at risk of legal liability and exposure to malware.

An analysis of eight billion web requests processed by the company in March confirms that roaming workers visit these websites significantly more when they are outside the office.

Specifically, roaming workers visit the following sites more than their colleagues in the office:

- Illegal file sharing sites 8.5 times more often
- Porn sites 2.5 times more often
- Extreme websites (sites with extremely graphic content) 5.2 times more often
- Illegal activities sites (eg. sites with information on building explosives) 3.9 times more often

“It’s no surprise that web browsing habits change when employees are outside of the physical confines of their office and away from the watchful eye of supervisors and colleagues,” says Dan Nadir, vice president of product strategy at ScanSafe.

“What is surprising is that there is such a huge increase in requests for what most organisations would deem highly offensive sites and in some cases illegal content – including the download of copyrighted material. If your employees are using a corporate-issued laptop to download illegal music files from home, your organisation could be liable.”

Interestingly, there is one category of sites that remote employees are less likely to visit when they are out of the office – banking sites. According to the data, roaming employees are 66 per cent less likely to visit an online banking site.

According to ScanSafe many companies are not securing web use for their remote workers. Extending security solutions for roaming laptop users is complex, hard to maintain, expensive, and falls short of offering full ‘roaming’ protection. In January, ScanSafe launched Anywhere+, the world’s first ever software-as-a-service (Saas) web security providing real-time protection from malware and enforcement of acceptable Internet usage policies for all users surfing the Web regardless of their location.

France - govt calls for investigation of SMS prices

Luc Chatel demande une étude sur les prix des SMS

Le secrétaire d'Etat à la Consommation, Luc Chatel, a demandé à l'Autorité de régulation des télécoms (Arcep) d'examiner les prix des messages texte (SMS) envoyés sur les téléphones mobiles pour vérifier qu'ils sont cohérents avec la baisse des coûts pour les opérateurs.

Les résultats de l'étude seront publiés fin juin, précise le secrétariat d'Etat dans un communiqué diffusé vendredi.

"Luc Chatel souhaiterait vérifier que les tarifs des SMS sont cohérents avec la croissance du marché et la baisse des coûts liée à l'augmentation des volumes", dit ce communiqué.

Le secrétaire d'Etat "souhaite que cette étude examine notamment les tarifs pratiqués pour l'envoi de SMS en hors forfait ou vers et depuis l'étranger" et il "invite les opérateurs à veiller à l'application d'un niveau de tarifs raisonnable d'envois de SMS notamment pour les envois de SMS en hors forfait en dehors des offres spécifiques ou vers et depuis l'étranger".

Sunday, April 20, 2008

India - higher spectrum evaluations

Finmin writes to DoT on spectrum pricing

The finance ministry has prepared a memorandum for the telecom ministry, placing a 3.5 times higher commercial value for spectrum. The note points out several procedural lapses linked to the spectrum issue.

The development follows two consecutive letters by the Central Vigilance Commission (CVC) to DoT (department of telecom), questioning the latter's refusal to allow spectrum allocation through open auctions. Recommending significant amendments to the spectrum pricing policy, the finance ministry's note has linked the commercial value of spectrum to telecom revenue growth since 2003.

It has concluded that for a pan-India operator, the circle fee fixed at Rs 357 crore per MHz should be inflated by a multiple of 3.5 times reflecting the growth in AGR (average gross revenue) per MHz between 2003 and 2008.

Referring to Cabinet meeting of October 31, 2003, the finance ministry has said it was decided that spectrum pricing would need to be fixed mutually between DoT and ministry of finance, so as to provide incentive for efficient use of spectrum as well as disincentive for suboptimal usage.

The telecom ministry recently allocated 120 universal access service licences (UASL), which comes with 4.4 MHz of startup spectrum. The cumulative price of these licences, based on 2001 fees amounted to Rs 8,986.49 crore. The finance ministry's new valuation places the real value closer to Rs 31, 452.72 crore, which implies a Rs 22,466.23 crore loss to the exchequer in the first quarter of 2008 itself.

TOI was the first to highlight that the market value of spectrum is at least three to four times the price at which it is being awarded. The finance ministry's latest note to the DoT shows a growing consensus among several key ministries including the PMO and commerce ministries that the recent signing of licences, which will lead to allocation of fresh spectrum was done at a loss to the exchequer.

TOI had further reported that the absence of any M&A restrictions in the new licences further allows these nine private companies to sell the spectrum at a huge premium in the open market. The CVC has strongly expressed its concern over DoT's dilution of M&A norms.

Rollouts for a pan-India GSM network involve a capex of at least Rs 15,000 crore. This is clearly beyond the funding capability of a majority of the new entrants who neither have the size nor the competence to compete with players like Bharti, Vodafone, BSNL and others. Absence of M&A restrictions sets the stage for license/spectrum resale to the benefit of new entrants.

DoT's reluctance to restrict spectrum sale by new entrants belies telecom ministry's assurance to PMO and CVC that scarce spectrum is being given at throwaway prices to keep telecom tariffs low. In the end, the consumer will be forced to bear the market value of spectrum, though depriving the exchequer in the process. The memorandum also documents observations about spectrum usage charge and need to enforce Trai's recommendations stiffening spectrum allocation norms based on a stricter subscriber-linked criterion.

Angola - competition

Angola: Free Competition in Telecommunications Defended

Angola Post-Office and Telecommunications deputy minister, Ana Maria de Guimarães, said Thursday in Luanda it is important that the countries preserve the free competition in the telecommunications market, observing ethic values to avoid unadvisable practices.

According to Ana Maria de Guimarães, who was speaking at the opening of the 11th meeting of the Regulatory Communication Organs of the Southern Africa Development Community (SADC), the protection of the markets leads to the protection of the rights of the population to services.

"Without regulation, incompatible practices are unavoidable, which affects the basis for the free competition. So, it should be preserved and defended, with a view to guaranteeing a healthy environment among the parties, in order to guaranteeing economic growth and satisfaction of the consumer needs.

In the context of globalisation, the SADC member States should outline policies of competition that guarantee the union of the markets, through agreements of protection, in the defence of a fair competition.

"We know that there are still limitations of the market and asymmetries of information's at SADC level, which causes irregular exchange in the relations of consumers, producers and suppliers of services, hence the importance to have a strong entity in the regulation of the markets," she added.

Thus, the official added, the Telecommunications Regulatory Association should be a strong entity, with autonomy and independence, capable of addressing the interests of the users, promoting the stability, impartiality and transparency, to facilitate investments of the region.

The Telecommunication Regulatory Association is an organ that works in the regulation of information and communication in Southern Africa. The Association is used as a platform in the regulation of matters that are discussed and decided as to how SADC might integrate its information, policies of communications and rules.

Europe - traffic data retention

A group of EU experts is to investigate problems with telecommunications data

The EU Commission has appointed a group of experts to consider the systematic retention of telephone and internet connection data. One of the tasks of this specialist group is to investigate the problems that member states have with implementing the EU Directive on telecommunications data retention. The problems particularly concern the obligation to retain data about email and internet telephony calls.

The group will also consider whether the controversial Directive needs to be amended. The Commission has until September 2010 to present an assessment of the practical application of the EU law to the European Parliament and Council of Ministers, on the basis of which further steps could then be decided on. The group of experts will assist the Commission in this process. The decision on its appointment was taken on 25th March, but has only now been announced.

Civil rights groups and professional associations have now appealed to the European European Court of Justice against the Directive. They have asked the Court to find that the EU Directive on telecommunications data retention is incompatible with fundamental rights. In support, they have quoted the petition for nullity brought against the Directive by Ireland in 2006. Besides the formal reasons stated in that petition, the campaigners see the Directive as an infringement of the right to a private life and correspondence, the right to free expression, and the right of operators to protect their property.

Pakistan - Omantel

Omantel acquires 65 percent shares of WorldCall

Omantel has acquired 65 percent shares of WorldCall Telecom Limited for $200 million. The finalisation of acquisition was announced in a ceremony held at a local hotel on Friday.

The CEO WorldCall Mr Salmaan Taseer led the WorldCall delegation while CEO Dr Mohammed bin Ali Al Wohaibi was leading Omantel team.

Pakistan Telecom Authority Chairman Major General (r) Shahzada Alam was the chief guest and Ambassador of Sultanate of Oman to Pakistan HE Mr Mohammad Bin Said Bin Mohamed AI-Lawati graced the occasion as guest of honour.

According to deal, Omantel is acquiring 488.8 million (65 percent of available) shares of Worldcall. Of this, 451.2 million shares are from sponsors while 37.5 million are being purchased from the public through the securities markets. The total value of this landmark transaction is around $200 million.

Speaking on the occasion, WorldCall CEO Salmaan Taseer said that it has been an immense pleasure for him to announce the acquisition. He said that WorldCall is the first company to launch payphone cards, High HFC System and local loop in the country.

Mr Taseer said that Pakistan enjoys very good relations with Oman. He said that WorldCall has a significant market share in long distance and international operations, wireless local loop, metro connect for telecom and enterprise connectivity on fiber optics.

The CEO of Omantel said, “The WorldCall Telecom Limited is one of the best telecommunication companies in Pakistan.” He said that there is great potential in telecommunication sector and Omantel would expand the network in Pakistan. He said that Omantel plans to escalate existing WorldCall operations to excel in telecom offerings with further enhancement of network reach and delivery capacity, targeting a rapid growth in market share.

The Chairman of PTA said, “The acquisition shows that there are great opportunities for the world companies to invest in Pakistan.” He said that recently China Mobile, world’s largest cell phone company, started its operations in Pakistan. He said that in the recent years, a number of companies have invested in the country. Alam said that Omantel has taken a right decision and PTA would ensure excellent services to the telecommunication sector.

Ambassador of Sultanate of Oman to Pakistan, HE Mr Mohammad Bin Said Bin Mohamed AI-Lawati congratulated both companies on signing the deal.

Worldcall is positioned in a unique way being the only true Multi Service Operator (MSO) in Pakistan telecom landscape with proven track record and established market position in various segments of its operations. Through this acquisition, Omantel has acquired direct access to a market of 170 million with immense potential for growth in core telecom and broadband service offerings. WorldCall has licenses to operate LDI, WLL and other telecom services across Pakistan as well as rights to a nationwide long haul network. Its WLL services cover 46 cities while its distribution network, which is one of the largest, reaches 59,000 outlets in 220 cities and towns.

Worldcall also enjoys leadership position with consistent growth in its market share for broadband connectivity and cable television with associated advertisement play.

Focus of rollout will principally target broadband segment with sustained growth of voice centric services. This planned expansion coupled with initial investment would see a sizable inflow of capital into Pakistan. Omantel is a publicly traded telecom company based in Oman with diversified operations. Acquisition of majority stake in WorldCall is its first overseas venture. staff report

Zambia - international gateway

Celtel Urges Zambia Parliament Action on Gateway Licenses

Pan-African mobile telecommunication company Celtel has petitioned the Zambian Parliament to break the deadlock over international gateway license fees that has been dragging on for more than two years.

Celtel hopes parliamentarians will force the Zambian government to reduce the cost of the licenses, currently pegged at US$12 million, to make the mobile market competitive. The operators claim the current fee is prohibitively high and that it is behind the high cost of communication in the country.

Appearing before a parliamentary committee on communications Monday, Celtel Zambia Managing Director David Venn said lower fees would help Celtel to effect a significant reduction in the cost of both inbound and outbound calls.

The petitioning of lawmakers follows several discussions between mobile operators Celtel and MTN and the government that have been in vain, with the government claiming that giving licenses to private operators would compromise security. The government also says that the incumbent operator, Zamtel, would lose out if private operators are given their own international gateways.

Zamtel provides both fixed and mobile-phone services, has exclusive rights to the Mwembeshi Earth Station and collects revenue from private service operators using the satellite’s facilities, including international gateway.

Venn told the lawmakers that the cost of communication would be cheaper if traffic was channeled through private mobile operators’ own international switches.

"The Zambian government and the Communications Authority of Zambia (CAZ) should come up with a law on the international gateway license to enable private operators," Venn said.

The lawmakers are expected to carry out their own assessment of the international gateway problem and make a recommendation that will be submitted to all parties on what should be done in order to break the deadlock. International gateway licenses allow mobile-service providers to have their own signaling access code, rather than using government-controlled access codes that monitor and record every call made.

Last month, Zambian President Levy Mwanawasa said Celtel and MTN (mobile telecommunication network) were foreign companies that should first ask their countries of origin whether they had liberalized their international gateways, before requesting other countries to do so.

Celtel is owned by the Mobile Telecommunication Company (MTC) of Kuwait and operates in 15 African countries including Nigeria, Uganda, Kenya and Tanzania, while MTN is a South African-owned company that has a presence in 22 countries in Africa and the Middle East, including Uganda, Kuwait, Nigeria and Yemen.

After pressure from the United Nations Conference of Trade and Development last year, several African countries promised to liberalize their international gateways and reduce the exorbitant costs of acquiring gateway licenses in order to make the mobile market in the region competitive.

In Uganda, the license cost is $214,000, while in Uganda it is pegged at $50,000.