Tanzania - growth of telecom sector

Tanzania sees rapid growth in telecom sector

Dar Es Salaam: Tanzania expects the number of phone users to rise by about 25 per cent to 13 million in the first half of 2009 with most growth coming from mobiles, the telecom regulator said on Friday.

Telecommunications is among the fastest growing sectors in the country. Government statistics showed it grew by 20.1 per cent in 2007, compared with 19.2 per cent a year before.

"Hardly four years ago we were less than two million. Towards the middle of 2009, we should easily reach 13 million," Tanzania Regulatory Authority (TCRA) Director General John Nkoma said.

"We do expect that by the end of this year, we should be hitting maybe 10.5 million or 11 million. It's largely driven by mobile."

At the end of 2007, Tanzania had 8.48 million subscribers, while by the middle of this year, it had 10.43 million. According to the regulator, Tanzania has a penetration rate of about 25 per cent for both mobile and fixed lines, making it still attractive for other players entering the sector.

Licences

Nkoma said TCRA issued licences last week to two local firms - MyCell and Egotel - for fixed line and mobile networks, among other services.

TCRA has also given Zain Tanzania, part of Kuwait's Zain, a licence to install an international gateway. Zain said in October it would invest $180 million (Dh662.04 million) on its network. It joins four other firms, including state-run Tanzania Telecommunications, lic-ensed to own international gateways.

A third application is pending from Smile Communications Tanzania Limited, owned by Mauritius' Smile Telecoms Holdings Limited with 65 per cent and local stakeholders, he added.

Two other companies, including HITS Telecom Tanzania, majority owned by Saudi firm HITS Telecom through its subsidiary HITS Africa, and locally-owned Dovetel, are also in the process of rolling out their networks, Nkoma said.

Other companies in the sector include market leader Vodacom Tanzania, a unit of the South African company jointly owned by Telkom and Britain's Vodafone. Others are Zantel, majority owned by etisalat and Tigo, owned by Millicom Cellular.

The east African nation of 40 million people, regarded as relatively calm in a volatile region, has been attracting investment in telecom and other sectors apart from traditional areas like tourism, mining and agriculture.