Price vs. valueNawras continues to press ahead despite sluggish share price performance

Towering ambiTionIs the independent tower company business in Africa just a fad?

maximum daTaUmax, Zimbabwe’s latest data network provider promises unique offerings

delivering on The vision Q.NBN’s success remains more important than ever in reaching Qatar ICT Strategy 2015 goals

Summer 2012 ISSUe 34

Mohammed Ali Al Mannai, CeO of Qatar National

Broadband Network

DeCISIve COverAge Of teleCOMMUNICAtIONS StrAtegy

Introducing the all-in-one mobile processor. Snapdragon™ processors bring together all the best-in-class components a Smartphone needs on a single chip. Because when everything is made to work together, everything works more efficiently. So you can do more. Do it faster.

©2012 Qualcomm Incorporated. All rights reserved. Qualcomm and Snapdragon are trademarks of Qualcomm Incorporated, registered in the United States and other countries. The Snapdragon logo is a trademark of Qualcomm Incorporated.

Comm.’s Summer 2012 issue is crammed with developments in the Middle east and Africa

telecom landscape that are genuinely market firsts, and which point to a rejuvenation of service providers’ efforts to modify their business models.

Qatar National Broadband Network is an initiative aimed at turbo-charging Qatar’s broadband connectivity, and is a brave move on the part of the state to stump up the cash for the investment in passive infrastructure, which can sometimes be a stumbling block to wider broadband advancement. talking of turbo-charging, we also talk to ross Cormack, CeO of Nawras, about his company’s investment in 4g as well as its progress in the offer of wireline broadband services.

Africa’s independent tower companies have been hitting the headlines in recent years and we look a little closer at whether the model may just

be a business fad or a sustainable way of conducting business that benefits all parties signing up to it.

We also report on the launch of one of Zimbabwe’s newest Internet application providers, Umax, and consider whether what they claim to be a differentiated WiMAX service in the country delivers on what it promises.

there’s also a view from our colleagues at Arab Advisors group on the investment opportunities that exist in sub-Saharan Africa, extracted from a report recently published by them in associated with Pursuit Mode Initiatives, the publisher of Comm., entitled Untapped potential: Africa’s remaining growth markets in focus.

Editorial

Active developments underway

Tawanda Chihota, Principal

2 www.Comm.ae

Contents I S S U e 3 4 S U m m e r 2 0 1 2

Features

Price vs. value 20

Despite a stock market share price that is languishing at more than 30 per cent below the level it listed on the Oman bourse in November 2010, Nawras continues to be an energetic operator that is looking to maximise the opportunities data usage represents. through the leveraging of its various access technologies and the bundling of products and services, Nawras continues to expand its base of operations, believing such a focus will generate the necessary good results

Towering ambition 24

Africa has been at the centre of a growing number of tower sale and lease-back announcements in recent years, with such arrangements typically involving the sale of the passive elements of network operators’ infrastructure. Initially it appeared to be an emerging business model that benefitted all parties, though the recent insolvency issues of some tower operators raises questions whether the model is as compelling in the long-term as it was initially made out to be

Maximum data 30

the demand for broadband data across Africa continues unabated, and in Zimbabwe one of the first of a dozen licensed Internet access providers, Dandemutande Investments’ Umax, launched service in June promising a wholly differentiated offering to what consumers have so far been used to

30

20 24

SUmmer 2012 3

Editor’s note 1

Comm.’s Summer 2012 issue is crammed with developments in the MeA telecom landscape that are genuinely market firsts

News 4

looking back at the most significant telecom developments and updates taking place in emerging markets around the world

Movers & shakers 28

A roundup of some of the most significant position changes that have taken place in the telecom market globally

regulars

Qatar National Broadband Network (Q.NBN) is a private company owned by the government of Qatar and charged with the responsibility to roll out passive fibre infrastructure across the country. given the Qatar’s ambitious digital plans, which are summarised under the Qatar ICt Strategy 2015 and further articulated through the Qatar National vision 2030, Q.NBN is playing a critical and pioneering role with respect to public-private partnership ICt infrastructure investments in the gulf.

“Q.NBN is a catalyst for competition,” said the company’s CeO, Mohammed Al Mannai in an interview with Comm. “I believe what we are trying to achieve is a first in the gulf region in so far as the costly part of the deployment of passive fibre infrastructure is being absorbed by the government,” he added.

established last year, Q.NBN’s mandate is to roll out passive fibre infrastructure across Qatar, and in so doing, place the company in a position to offer wholesale fibre backbone connections and capacity to licensed operators, hastening the uptake of broadband services. It is forecast that such uptake will cascade all the way down to consumers being offered a much improved and powerful fibre optic broadband service to empower their lives.

earlier this year the company received a 25 year licence to provide Qatar with fibre optic broadband throughout the country, having been officially endorsed as the fibre optic broadband infrastructure provider for the country.

cover story:Now or never

Comment 32

Philippe vogeleer offers his opinion on the long-term views service providers need to adopt to drive success

Hot Spots 38

Comm.’s guide to the most relevant telecom industry events to attend during the coming month

Comm. café 40

IHS CeO Issam Darwish answers questions about the role his company is playing in the telecom tower market in sub-Sahara Africa

16

32

our role at Q.NBN is to wholesale connections to the service providers, so to offer capacity or

bandwidth. The wholesale agreement we plan to put in place is under review, as is the costing calculation, though we are clear that we shall charge licensed operators per connection

4 www.Comm.ae

foreign investors will be able to buy stock in the UAe’s etisalat, according to local media reports.

etisalat group CeO Ahmad Abdulkarim Julfar is quoted as saying emirates Investment Council is currently working on amending the law to allow foreign ownership of etisalat shares. It remains unclear how much of the telco could be

owned by overseas investors.etisalat operates in 18 coun-

tries across Asia, the Middle east and Africa. It has a pres-ence in markets including egypt, Saudi Arabia, Afghani-stan, Sri lanka, Niger, Cen-tral African republic, tanza-nia and Sudan.

etisalat is currently 60 per cent owned by the govern-ment, with the remainder

listed on the Abu Dhabi Stock exchange.

Of the listed companies that do permit overseas in-vestors, the majority have limited this to around 25 per cent, although in some cases the stakeholding is permitted to be as high as 49 per cent.

Meanwhile rival UAe tel-ecom operator Du reported Q2 revenues rose by 12.9 per cent to AeD2.5 billion (US$689 million), while net profit surged by 51 per cent to AeD651 million.

the net profit margin (before royalty) stood at 26.6 per cent, up from 19.1 per cent in Q211.

Mobile revenues grew by a further 14 per cent year-on-year, reaching AeD 1.9 billion, with drivers of performance in this segment continuing to in-clude growth in the company’s customer base, strong minutes of use, and data usage.

Bulletin board

Qatar telecom (Qtel) has offered to buy the remaining 47.5 per cent stake it does not already own in Kuwaiti unit Wataniya, a Kuwaiti bourse statement said on June 26.

Based on Wataniya’s cur-rent market capitalisation of US$3.97 billion, the stake is worth about US$1.9 billion, Reuters data estimates.

Qtel is being advised by Barclays Capital and the in-vestment banking arm of National Bank of Kuwait, a source with direct knowledge of the matter told Reuters.

the Qtel offer was sub-mitted to Kuwait’s Capital Markets Authority, which is reviewing the proposal, the source said. Based on the au-thority’s recommendation,

Wataniya can review the of-fer and appoint financial ad-visors to evaluate it.

Qtel bought the Wataniya stake in 2007 for approxi-mately US$3.7 billion. Ku-wait Investment Authority, the gulf state’s sovereign wealth fund, has a 23.5 per cent stake in Wataniya and the remaining shares are publicly held.

etisalat looks to open up equity ownership to foreign investors

Regional news

Zain subs grow 5% Y-o-Y in H112, but revenues and net in-come remain flatZain Group reported its con-solidated financial results for the half-year ended June 30, 2012, which reflected revenues of KD663.5 million (US$2.38 billion), up 0.6 per cent year-on-year. Net income for the half was also flat at KD141.9 million, also up just 0.6 per cent year-on-year.

The operator counted 41.4 million consolidated active sub-scribers at the end of June, an increase of 1.8 million users or five per cent over the 39.6 mil-lion counted at the same time last year. By way of compari-son, Zain added 5.4 million new active subscribers over the 12 months to end-June 2011.

Qtel blames FX fluctuations for 11.8% fall in H112 net profitQtel Group announced results for the six-month period to end-June, reporting its consolidated customer base stood at 83.7 mil-lion, up eight per cent year-on-year. Group revenue for the pe-riod amounted to QAR16.4 billion (US$4.5 billion), up 6.1 per cent year-on-year, with EBITDA for the period amounting to QAR7.8 billion, up 8.2 per cent.

Net profit attributable to Qtel shareholders was down 11.8 per cent to QAR1.35 billion, with the telco attributing this mainly to foreign exchange losses in Indo-sat and Algeria.

For Q2 to end-June, Qtel’s revenue was up 4.6 per cent to QAR8.356 billion year-on-year, while EBITDA was up 8.5 per cent to QAR3.964 billion. Net profit attributable to Qtel share-holders was down 11.3 per cent year-on-year to QAR641 million.

etisalat Group Ceo ahmad abdulkarim Julfar is quoted as saying emirates Investment Council is currently working on amending the law to allow foreign ownership of etisalat shares

Qtel moves to acquire the remaining 47.5 per cent of Wataniya Telecom

SUmmer 2012 5

Qualcomm advertorial

As an enhancement to its traditional partnership approach with telecom players,

Qualcomm is emphasising the key role content will play in driving the telecom industry by sponsoring the Cinemobile Film Festival in Egypt.

“Our association with Arabi-acpd - the largest film produc-tion and distribution company in Egypt - to organise this festival, is a major step towards enhanc-ing user created content and creating high quality videos op-timised for smartphones,” said Moheb Ramsis, senior director of business operations for North Africa, Qualcomm. “It’s a clear way for us to show that content is a key value driver for the smartphone industry.”

This initiative represents a strong march towards expand-ing locally relevant content, complete with a specialised jury, an online platform for film-makers to upload their movies, and viewers to watch and vote for their favourite films using their smartphones or other con-nected devices.

From affordability to attrac-tivenessFor Ramsis and his team, smartphone affordability is just the starting point. “Now the focus is on enhancing the value of premium-priced devices

by giving consumers better applications and content,” he explains.

Qualcomm is creating a part-nership network that will work towards increasing the availabil-ity of content that is optimised, localised and built using a network of local developers to deliver more regionally relevant mobile applications. The com-pany recently announced a col-laboration with one of Egypt’s largest telecom conglomerates, Orascom Telecom Ventures (OT Ventures).

A holding company for several entities such as ARPUPlus, LinkDev, ConnectAds, and others, OT Ventures develops and provides different types of telecom value-added services ranging from applications devel-opment to content creation and aggregation, online advertising and more. Qualcomm’s as-sociation with Orascom will give both companies the opportunity to dip into the mobile content and applications pie across segments.

“Our partnership is overarch-ing and gives us the leg room to engage with Orascom in differ-ent areas, including jointly help-ing developers with trainings to create ground breaking new apps based on Qualcomm’s developer tools, such as our Vuforia SDK (Software Develop-ment Kits).

With smartphones having entered the affordability ranks, the device game is being spruced up with the drive towards enhancing supporting applications and content. Set to up the stakes in the mobile content space, Qualcomm is taking new routes to drive the content ecosystem

Qualcomm charts new directions for content and applications market

Augmented Reality presents opportunitiesAt the high-end, Qualcomm has been leading the develop-ment of augmented reality applications by training software developers to work with Qual-comm’s Vuforia augmented reality platform and to develop localised applications that are optimised – but not restricted - to run on Snapdragon-powered phones.

“Augmented reality is the con-cept of superimposing digital graphics on top of a view of the real world as seen through you mobile device’s camera. It is a very attractive concept in itself and there are many ways to ap-ply it in different areas of life. For example, imagine pointing your smartphone’s camera at a sign printed in Arabic and watching it instantly translate to English. Or imagine pointing it at an in-store advertisement and watching the images spring to life in 3D. There are also many other pos-sibilities, such as in education, entertainment, advertising, and more. The only limit is the imagination of local developers,” Ramsis says.

Looking at new ways for partnershipsBesides working with partners to drive content development, Qualcomm is also investing its time and efforts to grow mobile

content in other directions, including through its R&D in chipset development.

“We collaborate with a lot of companies that use our proces-sors in their devices and we work with them to port applica-tions and pre-load them on to devices sold in the region to give the devices and mobile services a local flavour,” Ramsis says.

Another way to drive collabo-rations is through retail initia-tives and operator partnerships, where content and applications are offered for free download when a device is purchased.

“Content strategy is being approached in many ways, including using it as a market-ing tool and promoting partner solutions. We are already seeing significant traction and expect to see many more locally de-veloped applications,” Ramsis emphasises.

moheb ramsis is senior director of business operations for North africa, Qualcomm

6 www.Comm.ae

Regional news

the tunisian govern-ment plans to put its 25 per cent stake in number-one operator tunisiana up for auction, reports Reuters.

finance ministry official

Slim Besbess said in a press conference that offers can only come from financial companies and investment funds and must be submitted by November 2. Operators

and operator shareholders are forbidden from partici-pating in the auction.

the stake being auctioned was confiscated from the Princesse Holding conglom-erate controlled by the son of ousted tunisian president Zine al-Abidine Ben Ali.

tunisiana won a US$135 million licence to launch 3g and fixed-line networks in the country in May. the re-maining 75 per cent stake in the operator is owned by Ku-waiti group Wataniya, which is majority owned by Qtel.

tunisiana controls 53 per cent of the three-operator market. It has approximately seven million mobile con-nections, ahead of rivals tu-nisie telecom (4.5 million) and Orange (1.7 million).

Bulletin board

South Africa based MtN group announced first-half revenues rose by 17.5 per cent to ZAr66.5 billion (US$8.1 billion), impacted by solid growth in South Af-rica, Iran and ghana, as well as by foreign exchange gains. On a constant currency ba-sis, group revenue grew 12.5 per cent year-on-year. first half operating profit also rose, to ZAr21.641 billion, up 22 per cent year-on-year.

MtN’s subscriber base grew by 6.9 per cent year-on-

year to 176 million.Market conditions con-

tinued to be impacted by increasing levels of compe-tition, regulatory require-ments, political unrest in certain countries and the global economic slowdown. growth in Nigeria was lower than anticipated as a result of intense competition.

group eBItDA increased 18.2 per cent to ZAr29.8 billion. On a constant cur-rency basis, eBItDA grew 12 per cent year-on-year.

the growth in eBItDA was mainly due to strong organic growth in South Africa and Iran, which grew local cur-rency eBItDA by 10.5 per cent and 36.4 per cent re-spectively.

Capex increased 77.7 per cent to ZAr10.14 billion, due mainly to an aggressive roll-out programme implement-ed earlier in the year and the ongoing focus on criti-cal capex investment pro-grammes across the group’s operations.

tunisian government to auction 25% stake in tunisiana

LiberCell suspends ops over unpaid tax billLiberia mobile network, LiberCell was ordered to close its services by the country’s tax courts for reportedly failing to pay licence fees.

The company, which is 30 per cent, owned by Kuwait’s Hits Telecom is said to owe US$1.5 million in licence fees, and will remain closed until the debt is settled.

Citing local reports, Bloomberg News said that court documents have been delivered to the doors of the company’s head office in Monrovia.

The suspension of licences in sub-Sahara Africa is unfortu-nately relatively common, though most operators fall in line.

Ericsson to deploy RBS 6000 technology in Vodafone EgyptEricsson has entered an agree-ment with Vodafone Egypt to continue to provide a quality network to subscribers through the transformation of Vodafone Egypt’s radio network.

Ericsson is set to deploy its latest RBS 6000 technology in the Vodafone Egypt network, which will allow the operator to meet the demands of its growing subscriber base and continue to provide them with quality mobile coverage throughout the coun-try. The RBS 6000 is a site so-lution that supports GSM/EDGE, WCDMA/HSPA and LTE in a sin-gle package.

Ericsson has enjoyed tremen-dous success with its RBS 6000 technology, helping it maintain a strong leadership position in the next generation infrastructure market despite the significant competition that exists across the globe.

Tunisiana controls 53 per cent of the three-operator market. It has approximately seven million mobile connections

MTN solid H1 results, with revenues up 17.5%

SUmmer 2012 7

Regional news

the StC group an-nounced that along with its affiliates, the Maxis and Oger groups, they have se-lected ericsson as one of their preferred global ven-dors for network infrastruc-ture, as part of their global synergy creation activities. the agreement will allow ericsson to offer its portfolio of network infrastructure equipment through a global price structure based on to-tal business in Bahrain, In-dia, Indonesia, Kuwait, Ma-laysia, Saudi Arabia, South Africa and turkey.

In 2010 the telco groups jointly launched a series of global initiatives focused on capturing synergies across their nine operating com-panies and on working with best-in-class global suppliers to become preferred part-ners based on value creating agreements.

One of the initiatives is to focus on technology in-frastructure synergies, with an objective of developing a global price book and for-malising volume discounts based on overall groups scale.

Left – anders Lindblad (ericsson), right - Ghassan Hasbani (STC International). The agreement between the two companies will allow ericsson to offer its portfolio of network infrastructure equipment through a global price structure

virgin Mobile South Africa announced the closing of 30 of its 38 retail stores in the country as it looks to re-focus its marketing efforts. the initiative has already commenced and is expected to conclude during the first half of 2013.

the MvNO in South Africa merged its operations with Dubai-based friendi group, which is led by Mikkel vint-er. together the two MvNOs are known as virgin Mobile Middle east and Africa (vM-MeA), and the company said

the aim of the changes is to deliver an improved and dif-ferentiated customer experi-ence by leveraging vMMeA best practice and investment in improved systems and pro-cesses.

virgin Mobile South Af-rica will convert the eight remaining stores from sales focused franchise stores into full service stores offering its entire range of products and services including sales, renewals, upgrades and cus-tomer service and advice.

the company will also be

offering online sales and ser-vice through a new improved website and is exploring new, alternative sales channels.

vinter had suggested that changes would be made in South Africa in order to bring the company to profitability in that market. Speaking to Comm. in June, vinter said: “yes, there are still losses at virgin Mobile South Africa, but I think what is required are some structural changes and tweaks, which I believe can turn the operator around quite quickly.”

Changes following Friendi group merger start taking effect at Virgin Mobile sa

Africa Cellular Towers served with liquidation notice

STC Group together with Maxis and Oger Groups engage Ericsson as preferred supplier

South Africa based mobile towers infrastructure opera-tor, Africa Cellular towers has been served with a liquidation order by the South gauteng High Court after failing to stave off bankruptcy.

the company has struggled against rising debts and fall-ing revenues for the past year, and a few months ago an un-named creditor started pro-ceedings against the company. the company, listed on the stock exchange, declined to name the creditor in June but simply said that a liquidator would be appointed shortly. two directors also resigned from the company.

Africa Cellular towers oper-ates three divisions, providing power lines, cellular towers and equipment shelters.

the company has been post-ing losses and was seeking an outside investor but had not secured the necessary invest-ment before the winding up order was served.

8 www.Comm.ae

Alcatel-Lucent advertorial

Laura Merling leads strategy and execution for Alcatel-Lucent’s company-wide push to trans-form the network into a powerful

platform for service providers, enterprises and developers to reap benefits from through the delivery of high-quality ap-plications. In July 2012, the GSA (Global mobile Suppliers Association) said 338 telecom operators in 101 countries had committed to commercial LTE network deployments or were engaged in tri-als, technology testing or studies.

The report went on to say 280 op-erators have made firm commitments to deploy commercial LTE networks in 90 countries. A further 58 opera-tors in 11 more countries are in a pre-commitment stage and are engaged in LTE technology trials, tests or studies.

The GSA stated that 89 LTE operators have now launched commercial services in 45 countries, with this number forecast to rise to 150 by the end of 2012. Given this level of investment in high-speed mobile broadband networks, much of it driven by demand for video content, Merling suggests carriers should start regarding themselves as an integral part of the application delivery eco-system rather than merely as sellers of data, or providers of just transport.

The telecom environment today is characterised by SMS and voice rev-enues being on the decline, accelerating

the need for operators to identify new revenue streams. There is also a require-ment for service providers to consider business models beyond access.

Merling describes application providers as having seized the consumer experi-ence; driven by consumer demand, with service providers now needing to redefine and reinvigorate their role in the value chain. In order to participate in the ecosystem, Merling advises carri-ers shorten time-to-market and lower costs for delivering new services.

With mobile data users forecast to consume as much as 100 times more data by 2016 than they do today, pos-ing both an opportunity with respect to the generation of increased revenues, and a challenge with respect to manag-ing the network’s ability to cope with such a significant increase in data traffic, operators need to make savvy choices.

An evolution of web and mobile is underway as Merling describes the new conversation experience as com-prising connectivity, cloud, commu-nications, data and ecosystems.

“Carriers need to think beyond transpor-tation,” Merling says. “They need to view LTE as a services-enabled environment in which they can charge differently. They can do this by partnering with a platform provider such as Microsoft to offer an Evolved Multimedia Broadcast Multicast Service (eMBMS), which is tailored for LTE

As LTE is commercialised in an increasing number of markets across the globe, Laura Merling, Alcatel-Lucent’s senior VP of Application Development Platform and Strategy, details how service providers, enterprises and developers can work intelligently to ensure they remain an integral part of the rapidly evolving wireless data ecosystem

Managing the new conversation experience

Laura merling is alcatel-Lucent’s senior VP of application Development Platform and Strategy

SUmmer 2012 9

Alcatel-Lucent advertorial

and allows multimedia content to be sent once and received by many end users.”

Service providers can also form content partnerships and offer the option for application updates to be pushed during off-peak times for ad-ditional credit to the end-user.

Connectivity in the evolving conversa-tion experience requires service pro-viders to think beyond transport and initiate new technologies and business models such as eMBMS and Smart-push for the efficient delivery of con-tent; or the auctioning of spare network capacity as a new business model.

Merling says service providers also have to consider bringing the power of the ser-vices of the network to the cloud, ensuring three fundamental building blocks – trans-formation, enterprise, and building – are in place. With respect to transformation, service provider infrastructure, operations and business models need to aligned; while enterprises appear to be ready for carrier cloud, which has a far greater rev-enue potential for service providers (10x) and is more attractive (4x) to enterprises than existing public cloud services.

Carriers should also be busy-ing themselves with the building of an agile service delivery platform for a new class of cloud services.

“There are three main ecosystem categories in the evolving data-centric conversation experience and these are the OS platform providers; the infrastruc-ture as a service (IaaS) providers such as cloud providers; and the content players,” Merling says. “Deployment of metrocells can optimise any downloading of data, and what LTE offers is the opportunity for service providers to gain a better un-derstanding of their customers’ contexts and to provide services and applications specifically tailored to those contexts.”

According to Merling, the new conver-sation experience is being reinvented in part by faster, higher capacity networks, smartphone proliferation, and changing consumer habits. Thus the requirement for management tools for converged

applications to bring personal, social media, and business contacts, and conversations together in one place, and the development of high quality video conferencing applications, unified inboxes, and device transfer services.

The management of consumers’ data, with respect to their value and identity is another required progression in the evolutionary path of conversations, with cross-telco Application Programming Interfaces (APIs) being developed for opt-in subscriber data. The benefit of such for subscribers includes the ease of log-in, personal data being stored in a single, trusted place, a reduction of forms to be

filled in from a mobile, and an ultimate enhancement to customer experience.

The benefits of cross-telco APIs to service providers include the improve-ment of identified visitors and per-sonalised services, to be able to feed databases with qualified operator data, and to increase the account creation success rate – more sales; more infor-mation requests; more subscriptions.

Alcatel-Lucent is heavily involved in helping customers around the world to transform their businesses to take advantage of the changing landscape where APIs have emerged as the lan-guage of the information economy.

Alcatel-Lucent developed Open API Platform (OAP) is an end-to-end API

monetisation and optimisation software solution, essential for service providers to turn their data and telecommunica-tion infrastructure into a commercial transaction platform. OAP provides the expertise, tools and services for API management, API design and creation, reporting and analytics for optimisation of API programmes, business model design for maximising revenue and ser-vice integration for time to market.

Using OAP, service providers are able to create and securely expose new services, either directly or via composite APIs, so they can be made available internally and/or to third parties, allowing for the creation and delivery of new offers to market, faster, at lower cost and at scale.

Alcatel-Lucent also recently intro-duced its API Lifecycle Methodology, which looks to help carriers create an effective end-to-end API strategy, while simultaneously establishing a repeatable process that maximises ef-ficiency, cost savings and revenue.

The Alcatel-Lucent API Life-cycle Methodology has three main areas of specialisation:

Definition - Knowing who you would want to use your API and what you would want them to do with it will help you define an initial business goal.

Design - Determine which pieces of your existing functionality, services, and data can be tapped with APIs. The protocols you use, the complexity of the APIs and their inputs and outputs will have tremendous bearing on whether and how third-party developers use them.

Deployment - An API platform does not get built once; it is continuously monitored and improved on the basis of developer response, application us-age, and evolving business strategy. The right analytics tools can not only help you maintain control of API use, they can help you understand how you are meeting your business objectives.

The benefits of cross-telco APIs to service providers include the improvement of identified visitors and personalised services, to be able to feed databases with qualified operator data, and to increase the account creation success rate – more sales; more information requests; more subscriptions

10 www.Comm.ae

International news

research In Motion (rIM) reported that in the three months to June 2, 2012, the company made a loss of US$518 million, compared with a prior-year profit of US$695 million, on revenue of US$2.81 billion, down from US$4.91 billion.

During the period, the company shipped 7.8 million smartphones and 260,000 tablets. this compares with 13.2 million smartphones and 500,000 tablets in the same quarter in fiscal 2012.

Providing something of a positive, the company said that

the overall BlackBerry sub-scriber base continued to grow, with increases in all regions except for North America.

Internationally, revenue fell during the period, reflecting price pressure due to compe-tition, and sales of its aging device line – a refresh is cur-rently underway.

the handset manufacturer also stated that its first Black-Berry 10 (BB10) device will now not be available until the first quarter of 2013, say-ing that the integration of key features into BB10 has been “more time consuming than anticipated,” pushing back the launch from late 2012.

rIM also confirmed its an-ticipated job cuts, although the size of the cull – around 5,000 staff from a workforce of 16,500 – was larger than many expected.

Bulletin board

ericsson reported that net sales in Q212 to end-June increased one per cent year-on-year to SeK55.3 billion (US$8.13 billion), and was up nine per cent quarter-on-quarter. However, net income fell a staggering 63 per cent in the quarter to SeK1.2 bil-lion from SeK3.2 billion a year earlier. the company said net income was impact-ed by lower profitability in Networks and increased loss in St-ericsson.

“In 2010 we made a con-scious decision to gain market share and increase technology and services leadership, well aware of the short-term prof-itability pressure. Our focus is now on translating these gains into sustainable profit-able growth,” commented Hans vestberg, ericsson and president and CeO.

ericsson explained that Net-works sales decreased 17 per cent year-on-year to SeK27.8 billion due to the expected

decline in CDMA equipment sales as well as weaker sales in China and russia.

global Services and Sup-port Solutions showed strong performance, up 26 per cent and 47 per cent year-on-year respectively, with ericsson describing that the underly-ing business mix, with higher share of coverage projects than capacity projects, was unchanged in the quarter and is expected to prevail short-term.

Ericsson impacted by lower profitability in Networks and increased loss at ST-Ericsson

rIM reports us$518 million loss in quarter to June 2

research In motion Ceo Thorsten Heins said the company shipped 7.8 million smartphones and 260,000 tablets during the three months to June 2

Smartphone success pushes 50% rise in Q2 net profit at SamsungSamsung reported a near 50 per cent rise in net profit for the sec-ond quarter on the back of strong smartphone sales.

The South Korean electronics vendor reported Q2 net profit of KRW5.19 trillion (US$4.56 billion), up 48 per cent from KRW3.51 trillion a year ago. To-tal revenue rose 21 per cent to KRW47.6 trillion with the mobile unit accounting for KRW20.52 trillion, a 75 per cent increase year-on-year.

According to figures published by Strategy Analytics, Sam-sung consolidated its lead as the world’s largest smartphone vendor by selling 50.5 million devices in Q2. It is thought that the flagship Galaxy S3 – launched during the quarter – accounted for 6.5 million in sales.

Huawei reports 22 per cent fall in operating profit in H112Chinese telecom technology provider Huawei reported H112 sales revenue of CNY102.7 bil-lion (US$16.16 billion), represent-ing an increase of 5.1 per cent year-on-year. Operating profit amounted to CNY8.79 billion with an operating margin at 8.6 per cent, an increase of 20.3 per cent half-on-half and a decrease of 22 per cent year-on-year.

In the first half of 2012, Hua-wei’s three business groups – Huawei Carrier Network, Huawei Enterprise, and Huawei Device—achieved considerable progress in technological innovation and market expansion, further con-solidating the company’s posi-tion as a leading global ICT solu-tions provider.

12 www.Comm.ae

International news

Bharti Airtel saw its profit fall during its fiscal Q1 to end-June, as the op-erator was faced by regula-tory and tax developments in India, and planned accel-erated investments in India and Africa.

In a statement, Sunil Bharti Mittal, chairman and MD of the company, said: “telecom revenues in India have been depressed due to hyper-com-petition and recent regula-tory and tax developments… On the African side, we are gaining market share, ben-efiting from the significant investments made in the last two years.”

for the quarter to June 30, 2012, the company an-nounced net income of INr7.62 billion (US$138.6 million), down by 37.3 per cent from INr12.2 billion, on revenue of INr193.5 billion, up 14 per cent year-on-year.

Stagnant eBItDA coupled with higher depreciation and amortisation arising from en-

hanced capex and licence fees resulted in the lower profit.

Mobile subscriber revenue in India during the period was impacted by two chang-es: Airtel said that guidelines from watchdog trAI around processing fees restricted the sale of bundled tariffs; and a tax increase led to all telecom services becoming more ex-pensive by two per cent.

In Africa, eBIt was US$62

million, up 23 per cent from US$50 million, on revenue of US$1.1 billion, up nine per cent from US$979 million. the company noted chal-lenges on the horizon, how-ever, including “economic and currency headwinds” in key markets, as a result of the eurozone crisis, lower aid and grants, rising inflation, and “political issues” in some countries.

Bulletin board

India’s Unitech has se-cured a court order blocking the mobile network, Uninor from selling its assets prior to the network’s expected clo-sure in August.

the network is a 67/33 joint venture between telenor and Unitech, and the two com-panies are in dispute over its

future.the Company law Board

has upheld a challenge by Un-itech against the sale of net-work assets. Uninor said that it would appeal the ruling.

Uninor had invited bids for network assets, which it was looking to sell before the net-work closure in anticipation

of securing higher valuations. telenor had said that it would make an offer if no other bid-ders emerged.

If telenor did buy the net-work infrastructure, it was seen as a precursor to re-en-tering the market following the forthcoming re-sale of the cancelled gSM licences.

Unitech blocks Telenor’s attempts to sell Uninor assets in India

airtel profit falls for another consecutive quarter

Facebook squashes rumours regarding smartphone develop-mentAlthough Facebook’s US$1.18 bil-lion in revenue for Q2 was slightly ahead of Wall Street expectations and up 32 per cent year-on-year, the company swung to a US$157 million net loss – and gave little guidance on future prospects.

The number of Facebook’s so-called monthly active users (MAUs) hit 955 million at the end of the period, up 29 per cent year-on-year, while 543 million of these now access the service via mobile devices, a 67 per cent rise.

CEO Mark Zuckerberg said Fa-cebook was “focused on invest-ing in our priorities of mobile, platform and social ads.” On the subject of mobile, Zuckerberg ap-peared to shoot down long-run-ning rumours about a Facebook smartphone. During a conference call he described “building out a whole phone” as something that “wouldn’t make much sense for us to do.”

airtel’s eBIT in the quarter to end-June in africa was US$62 million, up 23 per cent from US$50 million, on revenue of US$1.1 billion, up nine per cent from US$979 million

Alcatel-Lucent reports net loss of €254 million in Q212Alcatel-Lucent reported a net loss for its second quarter and announced that it is planning to reduce its headcount by 5,000 in an effort to further cut costs. The results make it the latest infra-structure vendor to suffer at the hands of the economic downturn, along with Ericsson and Huawei.

The company reported a net loss of €254 million (US$ 313 million) for the second quarter on the back of revenue of €3.55 billion. The loss was particularly severe when the previous quarter’s €398 mil-lion net profit is taken into account.

Revenue was down 7.1 per cent from €3.82 billion reported in Q211 but up 10.6 per cent from the previous quarter’s €3.21 billion.

14 www.Comm.ae

International news

Nokia announced a sharp fall in sales leading in Q112, resulting in a loss of €1.4 billion (US$1.73 billion) for the period.

During the three months (April to June) volumes of its Windows Phone-powered lu-mia range increased to four million units. However, it also noted that on a sequen-tial basis, the average sell-

ing price (ASP) of the lumia range fell to €186 from €220.

With the company having shipped 10.2 million smart-phones during the quarter, this means that Symbian and Meego devices still make up more than 60 per cent of these sales.

Sales for the quarter amounted to €7.5 billion, down 19 per cent from €9.3

billion. On an operating lev-el, the loss amounted to €826 million, compared with a loss of €487 million in Q2 2011.

In its Smart Devices unit, net sales fell by 34 per cent to €1.5 billion, as volumes fell by 39 per cent to 10.2 mil-lion units. More encourag-ingly, average selling prices in-creased both year-on-year (up seven per cent) and quarter-on-quarter (up six per cent) to €151, aided by stabilisation in the Symbian portfolio.

Stephen elop, Nokia CeO noted that Nokia’s mass-market Mobile Phones unit “demonstrated stability,” with a two per cent year-on-year increase in shipment volumes to 73.5 million. However, sales for this busi-ness declined by 11 per cent year-on-year to €2.3 billion, with average selling prices dropping by 14 per cent (six per cent over the prior quar-ter) to €31.

Bulletin board

the Pakistan government and etisalat are reported to have settled a long running dispute over the price paid for a stake in Pakistan telecom-munication Company lim-ited (PtCl) in 2006.

etisalat offered US$2.6 bil-lion for a 26 per cent stake in PtCl back in 2006 in staggered payments, but has withheld US$800 million in

a dispute over the transfer of assets from the government to the telco.

According to the terms of the agreement, etisalat was due to pay US$1.4 billion within one month after the signing of the deal in early 2006 and the remaining amount of US$1.2 billion was due to be paid in equal instalments over 4 and a half years, with one instal-

ment every six months.the settlement reportedly

agrees to a payment of US$700 million by etisalat, which is a reduction of US$100 million based on the valuation of the assets not handed over.

long standing plans by etis-alat to increase its holding to a controlling 51 per cent stake have been on hold until the dispute is settled.

Etisalat reaches deal over PTCL stake payment

Nokia reports Q2 results reflecting difficult market conditions

Nokia Ceo Stephen elop noted that sales in Nokia’s mass-market mobile Phones unit declined by 11 per cent year-on-year to €2.3 billion, with average selling prices dropping by 14 per cent to €31

RIM unveils LTE BlackBerry PlayBook

Research In Motion (RIM) has launched a LTE variant of its Black-Berry PlayBook tablet with built-in support for cellular networks.

The LTE BlackBerry PlayBook tablet is also enterprise ready. It can be managed with BlackBerry Mobile Fusion and includes Black-Berry Balance technology, which allows a user to utilise a BlackBerry PlayBook for both work and per-sonal purposes by keeping busi-ness information secure and sepa-rate from personal information.

The LTE BlackBerry PlayBook tablet comes with 32GB of mem-ory storage and became available from Bell, Rogers and Telus in Canada on August 9, 2012.

Indian government proposes 2G licence fee reductionThe Indian government has agreed to lower the proposed base prices for new 2G licences, with a govern-ment body known as the Empow-ered Group of Ministers (EGoM) having recommended a base price in the upcoming auctions of be-tween INR140 billion to INR160 billion (US$2.5 billion to US$2.9 billion) for a pan-Indian licence. That is below the INR36.22 billion/MHz proposed earlier this year by the Telecom Regulatory Authority of India (TRAI), which would have required local operators to shell out more than INR180 billion for a nationwide 5MHz licence.

According to local press reports, operators will still be required to pay existing spectrum usage charges of 3-8 per cent on top of the licence fee.

However, the EGoM has report-edly agreed to allow operators to pay for licences in instalments with GSM operators only required to pay 35 per cent up front, and CDMA players 25 per cent.

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16 www.Comm.ae

delivering on the vision

mohammed al mannai, Ceo of Q.NBN has more than 13 years of experience in network planning, deployment and optimisation with Qtel, where he most recently served as senior director for Network Design and rollout

SUmmer 2012 17

Qatar National Broadband Network

provider for the country.Q.NBN’s directive is in line

with the Qatari govern-ment’s vision to become one of the most well-connected countries on earth with respect to broadband; ambi-tions that are detailed in the Qatar ICt Strategy 2015 and the Qatar National vision 2030. the aim for 2015 is to see Qatar benefit-ting from information and communications technol-ogy (ICt) solutions in key aspects of its society and economy. Articulated in 2010, Qatar’s five-year plan ending 2015 contains the following measurable goals:

• Double the ICT sec-tor’s contribution to gDP (US$3 billion)

• Double the ICT workforce (40,000)

• Achieve ubiquitous high-speed broadband ac-cess for households and businesses (95 per cent)

• Achieve mass ICT and Internet adoption by all segments of so-ciety (90 per cent)

• Achieve wide accessibil-ity and effectiveness of all key government services (160 online services)

Qatar vision 2030’s four

guiding principles for a sustainable economy and growth path for Qatar focus on human, social, economic and environment develop-ment. Providing the high-speed communications and increased fibre capacity Qatar requires to achieve its ambitions is central to

Q.NBN’s mission, which the company is diligently going about trying to achieve.

the passive fibre network that has so far been com-pleted by Q.NBN consists of 6,000 connections, with Al Mannai forecasting that licensed network operators (Qtel and vodafone Qatar for the meantime) shall commence installing their

equipment imminently with testing commenc-ing and services set to go live in the short-term.

As part of the involve-ment with Qatar’s licensed operators, in April Q.NBN announced it had signed an Infrastructure Access Agreement (IAA) with Qtel, building on the relationship and cooperation estab-lished between the two companies with a heads of agreement signed in July 2011. the agreement last year represented the first step to defining a frame-work through which both parties could work together to support the govern-ment’s goal of accelerating implementation of high-speed broadband services for households, businesses and government agencies.

Under the deal signed in April, Qtel will supply Q.NBN with duct network access and access to other passive telecommunications infrastructure over the next 20 years. Such an arrange-ment is set to help reduce civil infrastructure costs on the part of Q.NBN.

In May 2012 Q.NBN went on to announce it

Qatar National Broadband Network (Q.NBN) is a private company owned by the government of Qatar and charged with the responsibility to roll out passive fibre infrastructure across the country. given the Qatar’s ambitious digital plans, which are summarised under the Qatar ICt Strategy 2015 and further articulated through the Qatar National vision 2030, Q.NBN is playing a critical and pioneering role with respect to public-private partnership ICt infrastructure investments in the gulf

“Q.NBN is a catalyst for competition,”

said the company’s CeO, Mohammed Al Mannai in an interview with Comm. “I believe what we are trying to achieve is a first in the gulf region in so far as the costly part of the deployment of passive fibre infrastructure is being absorbed by the government,” he added.

established last year, Q.NBN’s mandate is to roll out passive fibre infrastruc-ture across Qatar, and in so doing, place the com-pany in a position to offer wholesale fibre backbone connections and capacity to licensed operators, hasten-ing the uptake of broadband services. It is forecast that such uptake will cascade all the way down to consum-ers being offered a much improved and powerful fibre optic broadband service to empower their lives.

earlier this year the company received a 25 year licence to provide Qatar with fibre optic broadband throughout the country, having been officially endorsed as the fibre optic broadband infrastructure

Q.NBN is a catalyst for competition. I believe what we are trying to achieve is a first in the gulf region in so far as the costly part of the deployment of passive fibre infrastructure is being absorbed the government

18 www.Comm.ae

be attracted to invest in because the return on in-vestment is not that high,” Al Mannai acknowledged. “One of the government’s goals is to have affordable broadband services avail-able in the country, and it is willing to bear the initial costs to achieve this. So while the government has and will contribute funds to the entity, existing telcos are likely to also become shareholders in due course.”

Al Mannai did not want to be drawn on the capex estimation for the first phase of the infrastructure investment to end-2015, though published reports in the media have sug-gested it may rise as high as US$500 million.

“the costs may vary quite widely,” Al Mannai said. “Depending on whether we are rolling out infrastructure to brownfield or greenfield areas, costs could vary by as much as 80 per cent. So we have an estimate, but it’s not an exact figure, though from the start we are looking to minimise costs as much as possible by using any existing infrastructure that exists in-country,” he added

the secretary general of Qatar’s Supreme Council of Information and Com-munication technology (ictQatar), Hessa Al Jaber has been one of the driving forces behind the expan-sion and development of Qatar’s digital credentials, and she remains a staunch supporter of Q.NBN as a conduit for the country to catalyse digital development.

Currently Qatar has among the highest broad-band penetrations in the world, however, it lags significantly behind leading nations in terms of speed, with current maximum

had signed an interim wholesale agreement with vodafone, the first such wholesale agreement to enable a licensed telecom operators to use Q.NBN’s network to deliver telecom services to customers.

the signing represented a milestone in the relation-ship begun between Q.NBN and vodafone in 2011 with the signing of a heads of agreement similar to the one Q.NBN inked with Qtel.

Under the interim whole-sale agreement reached with vodafone, the cellco will initially provide broad-band services to residential and business customers in Barwa City and Barwa Commercial Avenue.

“By 2015 we should cover 95 per cent of the house-holds in Qatar and 100 per cent of the business establishments in Doha,” Al Mannai said. “In num-bers, this will account for approximately 260,000 con-

nections by 2015,” he added.the fibre network’s speci-

fications have been tested to meet customers’ expecta-tions as well as to ensure interoperability with legacy systems and Al Mannai is confident the wholesale model being instituted by Q.NBN will prove com-pelling to the licensed service providers it sells connections to currently as well as in the future.

“Our role at Q.NBN is to wholesale connections to the service providers, so to offer capacity or bandwidth,” Al Mannai explained. “the wholesale agreement we plan to put in place is under re-

view, as is the costing calcu-lation, though we are clear that we shall charge licensed operators per connection.”

Q. NBN will thus be of-fering licensed operators open access to a backbone network without discrimina-tion of any one party, and agreement terms will be uniform across the board.

Al Mannai went on to ex-plain that while Q.NBN has begun its life being owned

by the government, over time this is likely to change as private investors become involved in the project.

“Passive infrastructure is not the part of networks that typical investors would

Our role at Q.NBN is to wholesale connections to the service providers, so to offer capacity or bandwidth. the wholesale agreement we plan to put in place is under review, as is the costing calculation, though we are clear that we shall charge licensed operators per connection

a high percentage of copper based broadband coverage exists in Qatar but al mannai believes customers are keen to have this migrated to fibre, and thinks much of the demand coming between now and 2015 shall be from this segment of the market

SUmmer 2012 19

Qatar National Broadband Network

speeds of only 8 Mbps. And while the penetration rate is high with 70 per cent of homes having broadband at the end of 2011, Qatar’s population is expected to double over the next five years, meaning more lines of connection will be needed.

Current data from ic-tQatar estimates there are 186,000 broadband lines in the country, with nearly 400,000 expected to be necessary by 2020. Q.NBN aims to have 439,000 broad-band lines by 2025, covering households, government entities and enterprises.

“As a relatively small market, relying solely on attracting private invest-ment to build an expensive fibre network infrastructure would limit progress, delay advancements in important sectors and likely stall some already planned, forward looking projects,” Al Jaber said. “this government-led national broadband network effort will ensure progress and keep our commitment to bringing

connectivity to every corner of Qatar, including the most remote areas,” she added.

for his part, Al Mannai believes the overriding factor driving broadband demand and uptake in Qatar is the basic desire for connectivity, and Q.NBN is determined to help drive the Small Office Home Office segment of the market in particular.

“to be frank, both the traditional business as well as the traditional home seg-ment is driving broadband demand significantly in Qa-tar,” Al Mannai said. “A high percentage of copper based broadband coverage exists but customers are keen to have this migrated to fibre, and I believe much of the de-mand coming between now

and 2015 shall be from this market segment,” he added.

As further evidence of Qatar’s focus on improv-ing its ICt credentials, in May ericsson and ictQa-tar announced the launch of a strategic partnership that aims to boost the adoption of ICt in Qatar. the partnership, which was formalised through a memorandum of under-standing, seeks to support Qatar’s ICt Strategy 2015.

the MoU was signed by Hassan Al Sayed, ictQa-tar assistant secretary general, It and ICt gov-ernment Sector and ray Hassan, president erics-son gulf Countries.

As part of the partnership, ericsson and ictQatar will

collaborate in a number of areas including “technol-ogy for good” which covers initiatives such as sustain-ability through ICt solutions and also aims to use ICt to unlock the potential of the e-economy such as e-edu-cation and e-government in Qatar and the region. Other areas of collaboration include revamping the ICt infrastructure, and ena-bling platforms to support consumer driven Arabic content development, and improving the quality and efficiency of ICt services.

In addition, ericsson and ictQatar will focus on ICt maturity in order to create a knowledge-exchange based environment to increase the ICt usage in Qatar while leveraging ericsson’s global and local compe-tence in the ICt industry.

All said, Qatar is a bristling ICt and broadband market to witness, and the suc-cess of policies instituted in the coming 20 years are likely to be tied directly to the success of dedicated entities such as Q.NBN.

Depending on whether we are rolling out infrastructure to brownfield or greenfield areas, costs could vary by as much as 80 per cent. So we have an estimate, but it’s not an exact figure, though from the start we are looking to minimise costs as much as possible by using any existing infrastructure that exists in-country

ray Hassan, president ericsson Gulf Countries and Hassan al-Sayed, ictQatar

assistant secretary general, IT and ICT Government Sector signing the ICT moU

Despite a stock market share price that is languishing at more than 30 per cent below the level it listed on the Oman bourse in November 2010, Nawras continues to be an energetic operator that is looking to maximise the opportunities data usage represents. through the leveraging of its various access technologies and the bundling of products and services, Nawras continues to expand its base of operations, believing such a focus will generate the necessary good results

20 www.Comm.ae

Cormack freely admits that the competitive landscape in oman has become more aggressive in the last few years, not least through the presence of value-focussed resellers together with the omnipresence of a well-entrenched incumbent

Price vs. value

Nawras CeO, ross Cormack believes the telco has the neces-

sary positive momentum to continue propelling the company forward in Oman, despite coming through a tough operational period that has impacted its financial performance as well.

In the first quarter of 2012 the telco reported revenues fell by 2.7 per cent to OMr46.8 million (US$121.6 million), while net profit also fell by 19.1 per cent to OMr9.8 million.

the company’s total subscriber base rose by 2.4 per cent year-on-year to reach 1.99 million.

Nawras attributed the fall in revenues to a reduction in SMS revenues that was not fully compensated by growth in data revenue. In addition, revenue in Q1 2012 included a one-off accounting adjust-ment of OMr658,000.

the second quarter of 2012 marked a stabilisation in Nawras’ operational and financial results, though the telco’s first half perfor-mance still highlights the competitive nature of the telecom market in Oman, and the on-going pressure on margins. Nawras closed the six months to end-June with a customer base of 2.03 million, representing

a 4.4 per cent growth rate.the fixed service customer

base grew by nearly 176 per cent during the half to 36,787 customers, though Nawras’ overall revenue for the period was down 1.7 per cent to OMr95.3 mil-lion, delivering a net profit of OMr19.5 million, down 11.8 per cent from OMr22.1 million a year earlier.

“We recently moved into new open plan office space, the Nawras Campus, where our people can see one another and easily interact,” Cormack told Comm. “It is a fantastic location for us to be able to make decisions quickly and there is a palpa-ble energy that drives us.”

Cormack freely admits that the competitive landscape in Oman has become more aggressive in the last few years, not least through the presence of value-focussed resellers together with the omnipresence of a well-entrenched incumbent.

Nawras’ competitive ap-proach appears to be based on focussing primarily on the factors within its own control, more so than look-ing to what other players are doing in the market and reacting to those factors.

“It would be fair to say that in some areas the huge increase in use of data in

SUmmer 2012 21

Nawras

Wadi Kabir, Muttrah, Qurm, Azaiba, Al Khuwair, ghala, Baushar, Mawaleh and the Wave, by the end of the year. All major cities will enjoy lte coverage by June 2013.

In addition to the launch of 4g lte, 3g+ population coverage will rise dramati-cally from 53 per cent to 97 per cent over the next three years including greater cover-age in remote areas across

Oman. At the same time as new 3g+ sites are being introduced, the WiMAX home broadband network will be extended further.

“Over the coming 2-3 years we intend to turbocharge every base station, resulting in 97 per cent of the popu-lation having 3g+ access,” Cormack confirmed. “Hun-dreds of such base stations will be running by year-end,

with an overlay of 4g at 1800MHz also being intro-duced in the major cities.”

Cormack broadly describes the telecom sector as being at an inflection point given the growth and prevalence of over-the-top (Ott) players, with social networking and the consumption of video content via Internet-based companies such as youtube accounting for the major-ity of today’s data demand.

Nawras’ broadband network development approach is a diversified one, incorporating a number of access tech-nologies spanning mobile, wireless and fixed-line. last

Oman outstripped our abil-ity to provide it,” Cormack acknowledged. “We prob-ably did not build as fast as we should have done but that is all changing now and going forward, we are confident that we will man-age and support the growing data demand. We also have new people in our top line up, with a world leading CtO and CMO contribut-ing additional expertise from worldwide markets.”

Part of Nawras’ plan to keep abreast with the surging demand for data is a project it describes as ‘turbocharg-ing’ its network, which in essence means upgrading the network for increased capacity and performance.

to this end, at the end of June Nawras announced it had entered into an agree-ment with Huawei to upgrade its radio Access Network (rAN) by advancing all sites to enhanced 3g+ and in-creasing coverage, in-building penetration, capacity and the speed of the entire network. At the same time Nawras said it would be launch-ing 4g lte technology.

Nawras is deploying a lte fDD 4g network in the 1800MHz spectrum band, and together with the tel-ecommunications regulatory Authority’s release of two more 3g+ frequencies, the telco is looking to at least triple its mobile broad-band capacity. this upgrade programme is due to begin in August in Al Amerat.

Around 30 per cent of sites are set to be upgraded before the end of the year and customers are forecast to im-mediately notice the differ-ence as they start to receive fast 3g+ and 4g services. the 4g lte network will cover all major areas of Muscat governate including ruwi, the central business district,

It would be fair to say that in some areas the huge increase in use of data in Oman outstripped our ability to provide it. We probably did not build as fast as we should have done but that is all changing now

at the end of June Nawras announced it had entered into an agreement with Huawei to upgrade its radio access Network (raN) by advancing all sites to enhanced 3G+ and increasing coverage, in-building penetration, capacity and the speed of the entire network

22 www.Comm.ae

October, for example, the telco began offering a free trial of high-speed broadband to around 200 customers living in Al Mabailah North. for a three month period, customers were invited to experience the benefits of fibre-to-the-Home (fttH) with download speeds of between 10-100 Mbps.

the telco is working with Haya Water Company and the trA to implement the fibre optic technol-ogy needed to provide high-speed broadband.

A selection of four different fttH pricing plans offering a variety of different speeds were trialled to enable Naw-ras to fine tune its offerings ahead of the full commercial launch of the service, though Cormack describes Nawras’ activities in this area as being in “relatively early days”.

Nawras also continues to court the business segment in Oman, particularly the small and medium sized enterpris-es, and the 40 per cent seg-

ment of the business market that is non-government-relat-ed, where incumbent Oman-tel enjoys distinct advantages. Nawras has developed an offering of cloud services for small and medium sized enterprises, for example, and is pushing its global vPN offering as well. the introduction of fixed number portability for corporates is another development Nawras expects to benefit from.

On the consumer front, Nawras offers a plug-and-play home broadband service over WiMAX, while its consumer mobile business is focussed on the offer and delivery of bundles and seg-mentation efforts that differ-

entiate the telco’s services in the market more effectively.

for instance Nawras has devised a discounted inter-national calling number, and earlier this year launched a promotion whereby 800 Bz spent by a subscriber on Nawras services in a day would be rewarded by an additional 800 Bz of credit to be used on that day. Nawras has also devised bundled ser-vices to tie-in with the hugely popular Samsung S3 device, users of which are typi-cally high data consumers.

“With respect to our opera-tions in the business market, we believe it is all about relationship building. We are developing the corporate

Over the coming 2-3 years we intend to turbocharge every base station, resulting in 97 per cent of the population having 3g+ access. Hundreds of such base stations will be running by year-end, with an overlay of 4g at 1800MHz also being introduced in the major cities

market with the offer of global connections, innova-tive services like Business Mousbak, which permits calls within a company includ-ing prepaid at no additional charge, as well as desktop self-care,” Cormack said.

Strategically, Cormack says Nawras’ priorities include the addition of content and greater participation by the operator in the value added services ecosystem. the telco is also placing signifi-cant emphasis on reducing the cost of churn, and as Cormack likes to describe it, “delighting customers”.

the floundering share price, however, does remain a cloud over Nawras’ operations. Having become a publically listed entity with much fan-fare and excitement, the stock has consistently lost value, knocking almost US$400 million off of the value of the company in the less-than-two years since listing.

Despite this disappoint-ment, Cormack remains optimistic for the company’s future, and insists that should Nawras continue to improve upon its operational activities and innovate; this effort will be reflected in an improved stock price.

“I am confident that the ingredients we are putting into the company right now are allowing us to go into this exciting new world of data in an energetic way and I firmly believe we are on the right path to achieving the right results,” Cormack said. “We shall continue to focus on im-proving the range and quality of the services we provide, on improving our operational performances and delighting our customers. I am confident that the share price should duly reflect the good work that is being achieved and the progress that is being made.”

Strategically, Nawras’ priorities include the addition of content and greater participation by the operator in the value added services ecosystem. The telco is also placing significant emphasis on reducing the cost of churn, and “delighting customers”

SUmmer 2012 23

Key performance indicators

Untapped potential: Africa’s remaining growth markets in focus

Cellular adoption and penetration rates in selected countries (2011)

Cellular penetration rates (2011)

The exhibit below presents the mobile cellular penetration rates in each of 10 sub-Sahara Afri-can countries. As shown, the cellular penetration rates range from 16.4% in Ethiopia, to 83.1% in Ghana as of end-2011. The low penetration rate in Ethiopia is anticipated, as the market is a state-owned monopoly. The penetration rates indicate ample room for growth, especially given the sub-Saharan region is well known for the prevalence of multi-SIM cellular users.

Moreover, penetration rates in low income North African markets such as Egypt have reached 116%, which suggests significant growth potential for markets in sub-Saharan Africa.

Country Total cellular subscriptions (000s) Cellular penetration rate

Ghana 20,752 85.4%

Ivory Coast 17,928 79.0%

Senegal 9,696 72.1%

Zimbabwe 8,700 66.5%

Tanzania 25,823 61.2%

Zambia 8,165 60.1%

Madagascar 9,500 43.5%

Mozambique 8,095 36.8%

DRC 15,613 21.5%

Ethiopia 14,198 16.4%

Total selected countries 138,471 41.6%

For further details or enquiries to purchase the comprehensive report, Untapped potential: Africa’s remaining growth markets in focus, published by Arab Advisors Group in association with Pursuit Mode Initiatives FZE, contact Karl Hougaard, commercial consultant, tel. +971 50 400 1220 or karl@comm.ae

Source: Operators, regulators, Arab Advisors Group

Tower companies are planning to deploy multi-operator solar

powered cell sites in a bid to slash their diesel consumption

significantly in the coming years

Africa has been at the centre of a growing number of tower sale and lease-back announcements in recent years, with such arrangements typically involving the sale of the passive elements of network operators’ infrastructure. Initially it appeared to be an emerging business model that benefitted all parties, though the recent insolvency issues of some tower operators raises questions whether the model is as compelling in the long-term as it was initially made out to be

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Towering ambition

SUmmer 2012 25

Independent tower companies

have been looking to sell the towers to a tower company for approximately US$500 million, but sources indi-cated that a block sale of the entire portfolio proved difficult prompting the telco to consider a sale on a per-country basis.

last year, American tower Corporation announced the completion of the acquisition of approximately 960 existing towers from South African mobile network opera-tor, Cell C for an aggregate purchase price of approxi-mately US$140 million. At the time, American tower said it expected to acquire from Cell C approximately 440 additional existing tow-ers during the year for an aggregate purchase price of approximately US$60 million.

the tower company was also looking to acquire up to an additional 1,800 towers that were either under construc-tion or would be constructed over the next three years for an additional aggregate purchase price of up to ap-proximately US$230 million.

“the tower deals that we have been witnessing generate value for all parties, in part because of the different set of expectations held by telco operators and tower compa-nies, particularly in develop-

ing markets,” explains Javier gonzalez Piñal, partner at Oliver Wyman management consultancy in Dubai. “Op-erators tend to value the one-off cash payment resulting from the transaction itself. As margins decline and cash flow is stretched, operators appreciate the opportunity to monetise non-core assets above the long-term reduc-tion of the total cost of own-ership over 10 or 15 years.”

IHS is a Nigeria-based tower company that has been successful in appealing to the expectations of mobile network operators in Africa having last year secured an equity investment from the World Bank group’s IfC, along with co-investors Investec and fMO, to help the company build and

acquire mobile phone tow-ers in sub-Saharan Africa.

IHS is the largest telecom-munications infrastructure provider in West Africa and in August 2011 it went on to announce that Nigerian CDMA network operator visafone Communica-tions had agreed to sell and lease-back 459 towers for an undisclosed amount.

“It is estimated that towers account for almost 50 per cent of the total capex of a mobile operator and the as-

sociated costs of running and maintaining the towers could increase this to 60 per cent, IHS CeO Issam Darwish told Comm. “Selling and leasing-back may offer significant cost savings, as the operator no longer has to incur the cost of running towers.”

Darwish believes the offer-ings from the various tower companies vying for business in Africa are pretty uniform. In summary, he described the roles of a tower infrastructure company as follows: site plan-ning, bearing in mind the network rollout plans of pro-spective customers; obtain-ing of necessary regulatory approvals; erection and com-missioning of tower and the relevant equipment; provision of support services such as back-up power, air-condition-ing and security; and the pro-vision of turnkey solutions to telecom companies such as sourcing of equipment, testing and maintenance.

for its part, IHS has been in the sub-Saharan African tower market with operations in Nigeria, Sudan, Kenya and ghana for a little over a decade and although it began by building towers on behalf of mobile operators, the company has now expanded its offering to building buy-to-let towers as well.

IHS has expanded rapidly in recent years, with revenues surging nearly 50 per cent be-tween 2009 and 2010, from US$70 million to US$107 mil-lion. the company employs over 1,000 people who have built more than 2,000 sites; managed more than 4,000 sites; owns 900 co-location sites and provides best-in-class service with uptime of more than 99.95 per cent.

At the end of July it was announced that South Africa based mobile

towers infrastructure opera-tor, Africa Cellular towers had been served with a liqui-dation order by a high court in South Africa after failing to stave off bankruptcy.

the company had strug-gled against rising debts and falling revenues for the past year, and a few months ago an unnamed creditor started proceedings against it.

the fortunes of Africa Cel-lular towers contrast sharply with the wave of tower deals between mobile network operators and independ-ent tower companies that have made the headlines in Africa in the last few years.

In August, for example, MtN South African was reported to be considering selling off up to half of its towers network following successful sales by its opera-tions in ghana and Uganda. MtN owns around 6,000 towers in South Africa.

MtN South Africa’s managing director, Karel Pienaar commented that the motivation behind any such sale would be a move to improve the efficiency of the operator’s capital structure, arguing that infrastruc-ture on the ground is not a mobile operator’s core focus, and as such could be better leveraged by a third-party.

At the beginning of this year, etisalat group was reported to be mulling bids to sell its towers network in Africa. the telco has subsidiaries in 10 coun-tries on the continent and owned and operated around 4,500 towers at the time.

etisalat was reported to

In every tower deal, the price per tower is the key metric. It must be high enough to provide compensation to the seller but low enough to offer upside for the buyer. this factor is driven by local conditions such as country-specific capex requirements and current opex levels to run the infrastructure. In emerging markets, it has been remarkably stable, at around US$100,000 per tower

26 www.Comm.ae

According to Oliver Wyman’s Piñal, the suc-cess of IHS and other tower companies like it is based on a simple economic model:

• Operators sell part of their passive assets to a profes-sional tower company. that company optimises processes to reduce total cost of owner-ship. Operators receive a part of their expected return in the form of a lump sum (typically cash) payment.

• The tower company com-bines the stable cash flow it receives from the reference tenant (the selling operator) with the upside from ad-ditional clients (competing operators) co-locating in the same towers to increase the value of the assets purchased.

• Typically, the deal also includes a financial partner that, in exchange for an ini-

tial cash injection, leverages the stable cash flow (opera-tors’ rent) and a higher asset valuation at exit (through the co-location of multiple ten-ants) to obtain rates of return of 20 per cent – 30 per cent, and sometimes even higher.

“In every tower deal, the price per tower is the key metric,” Piñal explains. “It must be high enough to provide compensation to the seller but low enough to offer upside for the buyer. this factor is driven by local

conditions such as country-specific capex requirements and current opex levels to run the infrastructure. In emerging markets, it has been remarkably stable, at around US$100,000 per tower.”

In a recent interview Charles green, co-founder and CeO of another of Africa’s burgeoning tower companies, Helios towers Africa, described the appeal of companies such as his in allowing operators to focus on what they do best, servic-ing customers rather than managing infrastructure.

this advantage, green described, enables opera-tors to increase coverage and capacity quickly, without bearing the operational risk or long-term capi-tal requirements. It also has potentially significant positive implications for the industry’s carbon footprint.

the outsourcing of telecom infrastructure management is increasingly commonplace with 50 per cent of towers

in the US and 60 per cent in India now run by independ-ent companies. Operators are facing increasing competi-tion, falling revenues per user and need to reduce opex and capex, and independent tower companies provide a solution to them, green said.

Piñal suggests other traditional value drivers post-tower transaction, such as the tenancy ratios, or the expected opex savings, seem to be “nice to have” for the operators but not essential,

and are often left to be en-joyed by the shareholders of the tower company, and are not necessarily discounted in the initial selling price paid to the network operator.

“there are several possible reasons why operators hold such low expectations on the value maximisation capa-bilities of the tower com-pany post-transaction,” Piñal states. “An opex improvement might be more difficult to achieve for international tower specialists in emerg-ing markets (with limited local presence) than for the telco players that have been operating these networks for many years. Also, high co-location ratios could be more difficult to obtain in less mature markets,” he adds.

Oliver Wyman still con-tends, however, that opera-tors are satisfied when they off load their balance sheets and generate a positive impact on the debt position. the improvement to their financial position is enough of a benefit that they do not really mind leaving the upside to the shareholders of the tower company itself.

looking ahead, Darwish forecasts strong growth prospects for the independent tower companies that contin-ue to exercise and deliver on the right economic models. In his opinion, there are almost 100,000 towers in Africa cur-rently, with independent op-erators owning around 8,000 amongst them, while mobile operators own the rest. “Over the next five years another 30,000 to 50,000 towers will need to be constructed in Africa to keep up with demand and most of this will be done by independent tower companies while simultane-ously mobile operators will continue to sell their tower portfolios to independent tower companies like IHS.”

Over the next five years another 30,000 to 50,000 towers will need to be constructed in Africa to keep up with demand and most of this will be done by independent tower companies while simultaneously mobile operators will continue to sell their tower portfolios to independent tower companies like IHS

IHS’ Darwish suggests selling and leasing back towers offers significant cost savings, as the operator no longer has to incur the cost of running infrastructure

04_Reg News.indd 5 1/8/12 10:40:50 AM

28 www.Comm.ae

Movers & Shakers

eissa Al Suwaidi has been appointed chairman of etisalat group. Al Suwaidi also serves as an executive director at Abu Dhabi Investment Council. He is also a director of Abu Dhabi National Oil Company for Distribution, International Petroleum Investment Company, Abu Dhabi fund for Development and emirates Investment Authority. He also serves as the chairman of Abu Dhabi Commercial Bank.

Six new board members have also been appointed to the etisalat board. the new appointees are

Abdullah Salem Al Dhaheri, Mubarak rashid Al Mansouri, Shoaib Mir Hashim Khoory, Abdullah Mohammad Saeed ghobash, essa Abdulfattah Kazim and Mohammad Hadi Ahmad Abdulla Al Hussaini.

etisalat is 60.03 per cent-owned by the emirates Investment Authority, which is owned by the UAe government, and the chairman and government board representatives are directly appointed by His Highness Sheikh Khalifa bin Zayed Al Nahyan, President of the UAe and the ruler of Abu Dhabi by federal decree.

Khaled bin Abdulaziz Al GhuniemStC group’s incoming CeO, Khaled bin Abdulaziz Al ghuniem, assumed his role officially on June 18.

Al ghuniem is considered one of the most experienced corporate managers in Saudi, where he has held various senior positions. Prior to being appointed to lead StC group, he was CeO of Al-elm Information Security Company.

Al ghuniem has also been engaged as a full time consultant for the Defence and Aviation ministry, as well as an associate professor at the faculty of Computer and Information Sciences at King Saud University. He is a member of the board of directors of various Saudi companies and associations. He holds a bachelor’s degree in computer science from King Saud University, and both a Masters and PhD degree in electric and Computer Science from Carnegie Mellon University in the US.

Mikael GrahneMillicom International announced that its president and CeO, Mikael grahne is to step down from the position at the end of October. He is being replaced by Hans-Holger Albrecht, currently the president and CeO of Modern times group, an entertainment broadcasting group.

Hans-Holger has also been a member of the Millicom board of directors since May 2010 and will step down from this role with immediate effect.

grahne has served as Millicom’s president and CeO since March 2009, having joined Millicom in february 2002 as COO.

Mats NorinSt-ericsson announced changes in its organisation, appointing a new chief technology officer and simplifying its r&D and product organization structures.

Mats Norin has been appointed executive vP and CtO. Norin has been heading up ericsson’s Mobile Broadband Modules business which he started in 2007. An executive committee has been created, chaired by CeO Didier lamouche and composed of COO Carlo ferro, CtO Mats Norin, Marc Cetto and ronen Ben-Hamou.

Steve Baileyvirgin Mobile South Africa’s management has changed with CeO Steve Bailey stepping down. the company has identified a highly experienced candidate, and has also welcomed Anton landman, formerly CfO of DigiCel Panama, in the role of CfO. Anton will take the role of acting CeO until the new CeO is appointed on August 15.

Juha PutkirantaNokia has announced a number of changes to its senior leadership. Juha Putkiranta has been appointed executive vice president of Operations; timo toikkanen as executive vice president of Mobile Phones; Chris Weber as executive vice president of Sales and Marketing; tuula rytila as senior vice president of Marketing and chief marketing officer; and Susan Sheehan as senior vice president of Communications. Jerri Devard steps down as chief marketing officer; Mary McDowell steps down as executive vice president of Mobile Phones; and Niklas Savander steps down as executive vice president of Markets.

Sanjay Jha has stepped down from his role as CeO of Motorola Mobility and has been replaced by long-time google employee,

Dennis Woodside with immediate effect. google did not explain the reasons for the switch-over at the top, although it had been rumoured earlier this year that Woodside would take over the top job. He oversaw the takeover of Motorola Mobility from google’s end.

former Qualcomm executive Sanjay Jha joined Motorola Mobility in 2008.

Sanjay Jha

Carlo alloni

Eissa Al Suwaidi

Carlo Alloni has been appointed executive vP and head of operations for ericsson in the Middle east region. In his new role, Alloni will

oversee ericsson’s operations throughout the Middle east; ensuring customer expectations are met by leveraging the company’s global knowledge network to enable the development of best practice tools and methods throughout the region.

Alloni had previously held the position of president, ericsson North east Africa, to which he was appointed in 2010. An Italian national, Alloni joined ericsson in 2001 where he held multiple positions in sales, managed services/business unit global Services and business unit Networks in a number of ericsson offices across the globe.

SUmmer 2012 29

Qtel group has named Ahmed Al Derbesti as its new group chief operating officer, who will report directly to the group CeO.

Al Derbesti has worked with Qtel Qatar since 1985 and has held a variety of positions, including executive director, group Strategy, taking on this key

responsibility in the early days of the group’s expansion outside of Qatar.

He has also held the positions of executive director, Customer Care; executive director, International Services; and most recently, chief officer Wholesale and International Services, with responsibility for national and international voice, data and roaming services.

etisalat group announced the promotion of Obaid Bokisha from senior vP – Mobile Networks, etisalat group, to his

new position as chief procurement officer for the group with immediate effect.

the appointment will support etisalat

group’s strategic business directions for the UAe and across its 16 other markets. Bokisha will be in charge of all major contracts and agreements for the group across all of its regional and global markets.

Bokisha had been in his previous role for the last three years, and brings with him over 13 years of experience in the field of technology.

Wataniya telecom announced that Bassam Hannoun has been appointed as CeO and will commence in his new role soon.

Abdulaziz fakhroo resumes his role as deputy CeO having been appointed acting CeO following the resignation and departure of Scott gegenheimer in June 2012 to pursue other opportunities.

Hannoun was most recently the CeO

of Wataniya Mobile Palestine, where he was responsible for the successful IPO and growth of operations. Previously he was CeO of Jordan’s leading WiMAX operator, Wi-tribe Jordan, a subsidiary of the Qtel group. In addition to over twenty years industry experience in europe and the Middle east, Hannoun has a PhD in telecommunications engineering and holds a Masters of Business Administration with a focus on strategic marketing.

ahmed al Derbesti

obaid Bokisha

Bassam Hannoun

Kwon Oh-hyunSamsung group has named Kwon Oh-hyun as the new CeO of Samsung electronics, its handsets and consumer electronics subsidiary.

Kwon Oh-hyun is an internal promotion having headed the company’s component business and has been credited with its turn around. Outgoing CeO, Choi gee-sung is moving to become the head of corporate strategy at the parent company Samsung group.

Under his stewardship, Samsung

rose to become the largest handset manufacturer in the world. “As before, vice-chairman Kwon will oversee the company’s component business but, as chief executive, he will also handle corporate-wide affairs,” Samsung said in a statement.

Abdulrahim Al Nooryaniformer etisalat group chief procurement officer, Abdulrahim Al Nooryani, has been appointed chairman and CeO of etisalat International Pakistan.

John Buchanan

vodafone announced the retirement of John Buchanan, its deputy chairman and senior independent director, as of its board meeting on July 24, 2012. following the change, luc vandevelde will become senior independent director.

Khalifa Al Shamsi

etisalat group announced the appointment of Khalifa Al Shamsi as chief digital services officer for the newly established etisalat Digital Services Unit. the new division, which will focus on various industry verticals such as machine-to-machine (M2M), cloud services, commerce, digital advertisement, advanced communications, digital entertainment, and video services aims to boost the group position in the digital ecosystem and drive innovation and advanced services to the group customers.

Al Shamsi joined etisalat as a graduate trainee 19 years ago, and has since held various senior managerial positions within etisalat UAe. Prior to his most recent appointment, Al Shamsi held the position of senior vP technology Strategy for etisalat group, to which he was appointed in 2010, leading the etisalat’s foray into the digital space.

Patrick Spence

research In Motion (rIM) confirmed the resignation of its global head of sales, Patrick Spence, the latest in a series of high-profile executives to leave the BlackBerry manufacturer.

A rIM spokesperson said that Spence was leaving to take on a “leadership position in a different industry” when he steps down on June 15.

“the sales function will report directly into Kristian tear, our newly appointed [COO] when he starts this summer. In the interim, the sales function will report to [CeO] thorsten Heins,” the spokesperson said.

Spence’s resignation may have been due to him being passed over for the chief operating officer role in favour of tear.

london-based Spence is a 14-year rIM veteran.

the demand for broadband data across Africa continues unabated, and in Zimbabwe one of the first of a dozen licensed Internet access providers, Dandemutande Investments’ Umax, launched service in June promising a wholly differentiated offering to what consumers have so far been used to

30 www.Comm.ae

maximum data

In June, Umax launched in Zimbabwe’s capital Ha-rare, operating under the

umbrella of Dandemutande Investments, the holding company for Utande Internet Services, a well-known communications provider in Zimbabwe’s telecom sector.

the operating com-pany Umax runs a WiMAX network at 2.5gHz and promises amongst other things: super-fast 1 Mbps connections for all cus-tomers; 24-hour customer support; an expertly man-aged network for maximum up time and superior and consistent quality; and multiple Max mini-stores within some of Harare’s leading retail locations.

Umax claims to also be the only broadband Inter-net service provider in the country to offer a loyalty programme – Max rewards – for all customers.

Alvarion, a company providing optimised wireless broadband solutions address-ing the connectivity, cover-age and capacity challenges of telecom operators, smart cities, security, and enter-prise customers supplied

Umax’s WiMAX network together with the customer premises equipment.

“We do have plans to extend the network beyond Harare,” Mike Weeden, Dandemutande’s interim CeO said. “We will initially expand the network within Harare with further infra-structure and then the next phase will focus on geo-graphical coverage through-out Zimbabwe,” he added.

Dandemutande Invest-ments is majority owned by Masawara Plc; a Jersey reg-istered investment company that is primarily focused on acquiring interests in companies and projects based in Zimbabwe and the southern African region. Dandemutande Investments claims to have made an initial capital investment of over US$17 million as part of its Umax roll-out.

Weeden said prior to com-mercial launch the company had a six-month pilot phase over which period it added a few hundred friendly cus-tomers. “We are now aiming for several thousand new customers within the next 12 months,” Weeden said.

Umax’s initial network capacity is for 10,000 users and the company offers three bundles for custom-ers, all based on speeds

of 1Mbps, with 60 days validity. these are: Mega-max with 2gB at US$70; Mightymax with 6gB at US$140 and Monstermax with 12gB at US$240.

Umax indoor access de-vices are sold for US$200 including vAt, with the outdoor access device retailing at US$475, includ-ing installation, with the Wi-fi router and vAt.

Dandemutande holds an

Internet access provider (IAP) Class A telecommu-nications licence that it was awarded by the Postal and telecommunications regulatory Authority of Zimbabwe (POtrAZ) in July 2009. the licence allows the company to construct, operate, develop, extend, and maintain a public data and Internet access network, and to offer voice over Internet Protocol (voIP) services. to date, most of the licensed IAPs have not launched commercial services.

Competition in the broad-band space in Zimbabwe is frantic as service providers look to capitalise on the data opportunity, with those enjoying deeper pockets having been investing in backhaul and backbone infrastructure. earlier this year for example, telOne, Zimbabwe’s state-run mo-nopoly fixed-line operator announced the completion of the laying of a fibre cable along the Harare – Bulawayo highway, with the telco stating that it was in the process of connecting all cities and towns in between.

the capacity of the cable

We do have plans to extend the network beyond Harare. We will initially expand the network within Harare with further infrastructure and then the next phase will focus on geographical coverage throughout Zimbabwe

SUmmer 2012 31

Broadband in Zimbabwe

babwe, and offers some of the most competitive broad-band Internet services in the country via its ADSl service, which it has a monopoly on.

for its part, liquid tel-ecom recently confirmed that the construction of its fibre link between South Africa and Zimba-bwe was progressing well.

Starting from the north of South Africa, extend-ing from Johannesburg to Zimbabwe, the 521 kilometre link connects to liquid telecom’s existing fibre network and will carry much-needed capacity from the submarine cables inland.

liquid telecom has built the largest fibre network

in Southern Africa, which provides backhaul be-tween most urban areas and last mile connectivity in the main cities of Zam-bia, Zimbabwe, Botswana, lesotho and South Africa.

Its network is the first to cross country borders and covers some of the most challenging parts of the world where no fixed network has existed before.

liquid telecom operates as a wholesale carrier in all five countries as well as an operator in Zambia and Zimbabwe, providing virtu-ally unlimited broadband capacity to operators, ISPs, banks, mining companies and other corporations.

Zimbabwe’s capital Harare has seen a dramatic rise in broadband

investment and coverage, both wireless and wireline, in recent years

is 10gbps and telOne is reportedly now working on a cable linking Bulawayo to victoria falls and another to Beitbridge. the Beitbridge cable is set to further con-nect to an undersea fibre cable system in South Africa, with telOne already own-ing a fibre cable running from Harare to Mutare for onward connection through Mozambique to the eASSy undersea fibre cable system.

Along with Powertel, an-other state-owned IAP, and liquid telecom, a private player and subsidiary of econet Wireless Interna-tional, telOne has one of the most expansive terrestrial fibre cable networks in Zim-

Source: Postal and Telecommunications regulatory authority of Zimbabwe (PoTraZ)

Africom Aptics Trading Aquiva Wireless Dandemutande Ecoweb (Pvt) LtdPowerTel Communications Telecontract TelOne Transmedia CorporationValley Technologies BlueSat Access Pecus Enterprises

Zimbabwe’s 12 IAP class A licensees

32 www.Comm.ae

Comment

I was quite surprised when I attended the now traditional Arab

Advisors telecommunications conference this year. Not by the topics. Not by the content of the presentations. What was most surprising to me was the “mood” expressed publicly or in private by many of the senior managers present: for the first time in nearly ten years, I could not sense a clear direction about where the industry is going and what the industry needs to do. that was a first.

let’s go back in time. 15 years ago, the Arab world was late in terms of telecom development compared to other regions. the challenge was clearly how to give the population access to voice telephony. this led to the (partial) liberalisation of the telecom markets of the region; then the creation of local champions; then their expansion with public and/or private funds; then full mobile penetration; then value-added services; then better devices; then more services; then the increase of operational costs with the offering of advanced services; and finally the reductions of margins that many operators

are announcing currently. We have witnessed the

proliferation of strategic plans promising that each of the main telecom groups in the region would emerge as amongst the largest in the world. there’s nothing wrong with this aspiration. this fantastic ambition and commitment of resources led to significant successes in mobile, with penetration rates in some Arab countries growing to be on par or higher than the ones seen in some developed markets. We also saw some successes in fibre-optic deployments. However, the future is in data and the region still has data penetration levels that are well below what is seen in other parts of the world, with an average 14 per cent broadband penetration.

looking ahead, while regulators consider ways to lower end-user prices, arguably without enough consideration for the extent of financing required to deploy high speed networks; and operators seem to be wondering how to carry terabytes of data at high speed while still making profit; the world is changing very quickly. Not only politically

in some Arab countries, but more profoundly everywhere in the world, with young people in emerging markets gaining access to all sorts of information for the first time in their lives.

It has been calculated that global data traffic currently amounts to five exabytes of data per year, or 5,000,000 terabytes, or 5,000,000,000 gigabytes. It has also been estimated that this number will increase within five years to 130 exabytes of data per year, a huge increase in just five years, and operators in the Middle east do not appear ready for the data surge.

Beyond this lack of preparation, what is more obvious is the missed opportunity that it represents. On the same basis as the impact of mobile voice penetration has been calculated at an increase of 0.6-1.2 percentage points of gDP growth for every 10 percentage points of mobile penetration; the impact of a 10 per cent rise in broadband data transmission has been calculated as having a 1.2-1.4 percentage point increase on gDP growth.

Such a rise in gDP would represent opportunities for

Time to set new long-term goals…

SUmmer 2012 33

Comment

innovative entrepreneurs and millions of new jobs, which would be welcome in a region where over 50 per cent of the population is below the age of 25 years and where the overall unemployment rate is estimated at 26 per cent.

I believe this region needs to go back to having more ICt ambition if it does not want to fall behind and stay behind. It is time for the industry/ region to take objective stock of its achievements and, like it did 15 years ago, set long term policy objectives, and identify what is required to make sure that broadband objectives and customer needs are met. the region needs a new long-term development vision. Not in theory. Not in terms of telecom services, but in terms of activities enabled by telecom. No need to decide that we want to have the “best” possible services at the “most” reasonable cost, or that we want to offer “better” services. Without metrics, that would just be telecom jargon, which would not trigger the type of long-term investments that are required in our industry. the region needs to consider how it can create the million jobs that are needed for its youth, and to enable economic activity through telecom. It then needs to engage with all constituents of society about concrete targets, for instance in terms of data speed per person per area. the industry then needs to create scenarios, and assess how much would each of these scenarios cost; and through a process of further engagement with society select the most

suitable scenarios, and define how they should be funded and duly executed.

Difficult choices will have to be made such as between services offered in different parts of each country; or between services offered to clients paying more and clients paying less; or allowing telecom operators to keep extra profits, for instance in exchange of them committing to invest and/or support long term goals.

Challenges are present with respect to growing economies and driving up employment rates in emerging markets, though positive examples do exist. the South African authorities have, for instance, initiated a dialogue with the public over the achievements and pitfalls of liberation in the past 15 years since it was introduced. they have been interested in discussing what South Africa would look like in 2030, and how

ICt can be used to support this transformation. Such long-term dialogue with all stakeholders is commendable.

I thank you if you have read this opinion piece this far. If you have, and it has contained matters you can relate to, please talk about it whenever and wherever you can, so that we start focusing on what we need to do tomorrow to create the future that this region strives towards. If you are still not convinced that this needs to happen, please read the following conclusions of an independent study published at the end of 2011 about sub-Saharan Africa:

“releasing digital dividend spectrum to stakeholders willing and capable of achieving broadband development is likely to represent the creation of up to 27 million additional jobs over a five- to 10-year period. that would bring up to 40 million additional people

out of poverty in that region, and allow the middle-class to grow dramatically.”

the above summary is just as pertinent for the Middle east as it is for Africa. It is up to us to decide whether we want to continue defining telecom in terms of the expansion of the things we are currently doing; or whether we want to redefine what we need to achieve, and then give ourselves the best chances to achieve it.

Philippe Vogeleer is an executive with Vodafone Group. He works on long-term development in the Middle East and Africa region. He is based in London. Prior to his current role Philippe spent seven years in the Middle East. The comments expressed in this article are Philippe Vogeleer’s alone. For further exchange of views, Philippe can be contacted at philippe.vogeleer@vodafone.com

Main investment opportunities in African cellular markets

Investment opportunity Relevant investors

Greenfield cellular licences Mobile operators, network vendors

Handset market, especially 3G enabled handsets and smartphones, as well as entry-level voice devices

Handset vendors

Mergers and acquisitions Mobile operators

Value added servicesContent providers, IT solution companies,

start-ups

Cost saving solutionsIT vendors, network vendors, tower leasing

companies, systems integrators

Network expansionOperators, network vendors, virtual

operators

According to a research report recently published by Arab Advisors group in cooperation with Pursuit Mode Initiatives, the publisher of Comm., the room for cellular growth in sub-Sahara Africa remains significant. the demand for cellular services coupled with the ample room for growth on the sub-continent makes for attractive factors for regional and global investors

34 www.Comm.ae

investment opportunities

Source: arab advisors Group

It is anticipated that the economy of sub-Sahara Africa is set to grow at rates high-er than global averages with the World Bank projecting Africa’s gDP to grow by 5.3 per cent and 5.6 per cent respectively in 2012 and 2013 against the aver-

age global growth rates forecast at around 2.5 per cent over the same period. the exhibit below lists some of the main investment opportunities in sub-Saharan Africa.

SUmmer 2012 35

Africa research

Country Type of licence Operators Date of launch

TanzaniaMobile network operating

licenses

My Cell Has not launched commercially

Egotel Has not launched commercially

Rural Neto Has not launched commercially

Smile Has not launched commercially

Excellent com Has not launched commercially

GhanaMobile network operating

licenseGlo Mobile April 2012

MozambiqueMobile network operating

licenseMovitel May 2012

Recent cellular licences granted to operators (starting January 2009)

Cellular licencesNational regulators continue to grant cellular licences even in markets across sub-Saharan Africa with comparatively large numbers of cellular players. the most pronounced examples of such in-clude tanzania, where an additional five cellular licenses have been granted by the tCrA since 2007, in a country that already counts seven licensed operators. We advise caution in the investment in new licenses granted in countries where further growth potential is limited.

We also believe it is worth keeping a keen eye on changes in policy in a country such as ethiopia, which may be monopolistic market today, but could move to liberalise at short notice.

Mergers and acquisitionsSub-Saharan Africa has enjoyed a vi-brant mergers and acquisitions history in the past decade. Bharti Airtel’s acqui-sition of Zain’s assets in Africa in 2010 for US$ 10.7 billion was one of the larger deals concluded. MtN group at-tempted to acquire Orascom telecom in 2011, and pan-regional players remain alert to opportunities that may arise.

Mobile device opportunities the Arab Advisors group projects cel-lular subscriptions to grow at a 2012-2016 CAgr ranging between 5.4 per

cent and 30.4 per cent in the selected countries included in this report. Moreover, we believe smartphones will grow at a faster pace than fea-ture phones, which is consistent with insights provided by regional operators, such as MtN group. the forecasted growth in smartphones will be driven by the demand for mobile data, 3g cov-erage investments by operators, and the reduced cost of smartphones in light of handset manufacturers pushing ultra-low cost smartphones on the continent.

According to france telecom Orange, by 2011, smartphones accounted for 11 per cent of the operator’s subscription base in Africa. these subscriptions ac-count for 82 per cent of the operator’s cellular network traffic. On a similar note, MtN group stated that by the end of 2011 it had 5.5 million 3g devices on the network which included 3.6 million smartphones and 1.4 mil-lion dongles and other data devices.

Innovative value added services the rollout of 3g networks and dis-semination of smartphones in the Arab region has helped in the emer-gence of local content and mobile application start-ups. We believe that similarly an opportunity arises for local content production in Africa.

the most pronounced regional value

added service that has been a successful revenue generator beyond basic SMS is mobile money. the current uptake of basic mobile money transfers suggests that there is demand for fully fledged mobile money services in sub-Saharan Africa. the Arab Advisors group be-lieves that regional operators should evolve mobile money from mere cash transfers into fully fledged banking services by utilising mobile SIMs for money deposits, credit, withdrawals, and purchases, among other activities. We believe that the duplication of mo-bile money models and best practices into other vibrant industries, such as government services, health, and edu-cation, could also create viable revenue streams for regional operators, and will drive technology adoption in a crucial period where operators are heavily investing in broadband networks.

This is an extract from Untapped potential: Africa’s remaining growth markets in focus, a report published by Arab Advisors Group in associa-tion with Pursuit Mode Initiatives FZE. Contact Karl Hougaard, commercial consultant, tel. +971 50 400 1220 or on karl@comm.ae for more details about the report or to order your copy.

Source: arab advisors Group, telecom regulators

In 2011 ericsson counted 12 managed services contracts in the region and 70 million subscribers under management at the end of the year. the demand for such services underlies an increasing awareness by service providers to be first-to-market with products and services as well as the cost savings inherent in well-planned and implemented efficiency drives

36 www.Comm.ae

akesson says service providers are focussed on business innovation through the development of new vertical markets to address

support where it is needed

ericsson has more than 15 years’ experience managing multi-

vendor, multi-technology networks for operators glob-ally and during 2011 entered into 70 managed services contracts worldwide that covered a subscriber base numbering 900 million.

ericsson’s managed services offering is built on global scale and proven processes, methods and tools. It con-sists of activities within net-work design, build, planning and operations. Its offering consists of five segments:

• Network man-aged services

• IT managed services• Broadcast man-

aged services• Network sharing• Managed services

for enterprises

the telecom technology provider manages multi-vendor and multi-technology environments, enabling service providers and enterprises to concentrate on their core business. All service segments are flex-ible in terms of scope and setup, and can be adapted

SUmmer 2012 37

Ericsson Managed Services

by the growth in machine-to-machine applications, and the opening up of new services given the invest-ment in mobile broadband.

“We have solutions to help service providers deliver on these x-factors, for instance our OSS/BSS offering, which facilitates modernisation, simplification, and consoli-dation of network elements,” Akesson said. “In managed services we are working in areas that include the net-work, It, network sharing, and even broadcast, where there are real efficiencies to be gained by the ser-vice provider,” he added.

On-going endorsements of ericsson’s managed services vision in the region come from engagements such as that given when MtN Af-ghanistan a deal in May for ericsson to operate and op-timise its mobile network as well as its charging systems and value added services such as mobile applications. the deal was part of an agreement that covers end-to-end managed services.

Under the managed ser-vices agreement, ericsson agreed to deploy its end-to-end solutions and systems to help MtN in Afghanistan achieve better network ef-ficiency, simplify operations and ensure better quality network through 24/7 net-work monitoring. the agree-ment was in line with MtN’s growth strategy and its continuous focus to enhance customer experience through improved network capacity.

More than 20,000 employ-ees have been transferred to ericsson from operators around the world, through large arrangements such

as the signing of a deal with Zain Iraq last year for US$650 million in a five-year network outsourcing agree-ment. Under the agreement, ericsson agreed to optimise, modernise and manage It operations and Zain’s mobile network in Iraq that included more than 3,700 sites across the country.

In Q411, ericsson’s sales in services were almost equal to the sales in networks in the Middle east, highlighting the twin dynamics of slowed infrastructure investment during the period and con-tinued interest from service operators in the benefits that can be driven by managed services engagements.

the vitality of managed services to ericsson itself is also clear to see, with the technology company report-ing that its global Ser-vices and Support Solutions showed strong performance in the Q212 to end-June, with revenues for the period up 26 per cent and 47 per cent year-on-year respective-ly. ericsson described that the underlying business mix, with higher share of cover-age projects than capacity projects, was unchanged in the quarter and is expected

to prevail short-term.ericsson’s managed services

portfolio may imminently be boosted further with persistent rumours that the company is interested in ac-quiring rival Nokia Siemens Networks’ (NSN) business support systems (BSS) divi-sion, according to reports.

ericsson has been busy expanding its OSS/BSS unit, including the acqui-sition, completed at the beginning of this year, of US OSS company telcor-dia for US$1.15 billion.

At ericsson, the belief is that good support systems and business processes provide for opportunities to be seized and turned into value. they do not just help a company operate a business, but also to develop it, scale it, optimise it and transform it in a cost-efficient way.

ericsson also believes that good support systems and business processes bring or-ganisations closer to custom-ers and places such organi-sations in a pole position, ready to respond to customer needs and grab new op-portunities as they arise.

As the scale and scope of business increase, so does the challenge to provide operators with the sim-plicity needed to remain efficient, innovative and always focused on the customer experience.

Bringing together cutting-edge technology, world-leading consulting, systems integration, and managed services, with an unmatched holistic insight into the operator’s challenges makes ericsson a partner to count on in a fast changing world packed with opportunity.

to fit individual needs.ericsson also has exten-

sive experience in advising and supporting operators to secure network quality, revenue enhancement and improved cost efficiency. the company manages networks in which more than 50 per cent of the equipment comes from other vendors.

By utilising ericsson’s managed services expertise and experience, service providers and enterprises:

• Gain the right com-petence in the right place at the right time

• Can be confident that network and business com-plexity is well managed

• Achieve a fast and cost-effective launch of new services

• Reduce costs• Secure predict-

able performance.

ericsson’s Staffan Akesson, vice president and head of Managed Services for region Middle east believes that operators are chasing a num-ber of ‘x-factors’ in order to achieve success, and ericsson has been instrumental in helping them realise such. Increasingly service providers are looking to improve the customer experience through the offer of personalisation, wider choice of services, and bundling; while at the same time looking to drive business efficiency through modernisation of networks, outsourcing models and de-velopment of cloud services.

Akesson says service pro-viders are also focussed on business innovation through the development of new vertical markets to address the opportunities offered

In managed services we are working in areas that include the network, It, network sharing, and even broadcast, where there are real efficiencies to be gained by the service provider

38 www.Comm.ae

FTTx MENA SEPTEMBER 24-25, 2012

DUBAI, UAE

hTTP://FTTxEvENTS.coM/

Building on last year’s extremely successful event, Informa presents the 5th annual fttx MeNA summit, bringing together operators, vendors, content providers, utility companies and regulators. this event provides an ideal opportunity to meet key decision makers from the entire ecosystem to discuss experiences, challenges and solutions and hear the latest emerging trends and technologies in the fttx marketplace.

the Middle east market remains a hotbed of activity in terms of fibre deployment. With coverage of UAe homes nearing 100 per cent and further deployments by key operators in Saudi Arabia, Qatar and Bahrain among others, the region is ripe with opportunity and alive with activity.

featuring a fully-interactive programme, pre- and post- conference workshops, an etisalat masterclass, and presentations from the leading operators in the region, this is an event not to be missed.

Telecoms World Middle East 2012ocToBER 2-3, 2012

ATlANTIS, DUBAI

hTTP://WWW.TERRAPINN.coM/

coNFERENcESINMIDDlEEAST.ASPx

After seven successful years, telecoms World Middle east is back to tackle the biggest issues bursting out of telco boardrooms.

Meet industry leadersJoin over 600 attendees to discuss the tools and strategy to help you navigate through the changing landscape of the increasingly competitive telecoms industry.

What’s new for 2012the event will be framed with morning and afternoon keynote plenary sessions, making sure the hard hitting issues are debated by game changers and decision makers in the telecom industry.

Small cells MENAocToBER 9-10, 2012

DUBAI

hTTP://WWW.SMAllcEllSMENA.coM/

from complex, multi-tiered concrete jungles to sparse deserts, providing the MeNA landscape with good network coverage is both complex and demanding.

Small cell solutions present an exciting option to both improve mobile coverage in hard to reach areas and also to increase capacity in network hotspots.

With a mobile penetration rate of over 90 per cent, it is an exciting time for the small cells industry across MeNA, but networks are being pushed to their capacity limits. All major mobile network operators across the region are trialling and deploying programmes in an effort to cater to their subscribers’ coverage needs.

As the latest addition to our Small Cells global Series, run in exclusive partnership with the Small Cells forum, Small Cells MeNA will bring together senior representatives from the leading mobile operators across the region.

Make sure you join your peers in Dubai to share your learnings from the region’s small cell and femtocell trials and deployments, discuss the practicality of available backhaul solutions to support your service and debate the technical and commercial future for small cell solutions.

GUlFcoMMS (GITEx)ocToBER 14–18, 2012

DUBAI, UAE

hTTP://WWW.GITEx.coM

gIteX is one of the largest trade events on Dubai’s calendar. the event is a gateway for global brands to access the Middle east, the fastest emerging and investment ready ICt market. It is also one of the longest running annual conferences in Dubai – 2012 will be its 32nd year.

In 2010 the exhibition comprised over 3,500 domestic and international It vendors offering their latest products to 136,000 ICt professionals. It also acts as

a hub and access point to wider markets from North Africa and South Asia, all of which are a huge draw to global brands.

each year gIteX technology week holds a themed global leaders Summit. In 2011, this focused on ‘innovation in leadership’ thanks to a new era of transformation leadership, most recently seen in runaway successes like facebook and groupon. World class presenters shared strategies, ideas and technical insider information on how to become an innovative leader.Conferences co-located at gIteX

2012 include industry briefings, Consumerisation of It, Cloud Confex, and Digital Strategies.

ITU Telecom World ‘12ocToBER 14-18, 2012

DUBAI, UAE

hTTP://WoRlD2012.ITU.INT

ItU telecom World 2012 is the leading platform for the global ICt community to connect, debate, network and share knowledge on the critical issues shaping the future of the industry, and of the world. Drawing on its unique reach as the leading UN agency for ICt issues, ItU will bring together key stakeholders, decision-makers and thought-leaders from across the entire industry ecosystem, service providers, manufacturers, government, regulatory bodies, academia and global media in five days of debate in Dubai, UAe, from 14 – 18 October.

A dynamic agenda comprising an exclusive leadership Summit, forum panel sessions, workshops, roundtables, keynotes and networking events will explore the radical transformation of the ICt industry, the implications for policy, regulation and competitive strategy - and the crucial importance of ensuring that connectivity in a transformed world is universal, fair, open and secure.

New technologies, trends and innovations - game changers - are revolutionising the industry sector and the way in which we live, work, communicate and do business. the major categories of game changers

SUmmer 2012 39

Po Box 53402,Dubai, UAETel: + 971 4 369 5604

Publisher: Tawanda Chihota

Lic. No 1468/2011CC, Fujeirah Free Zone

EDIToRIAl

Principal: Tawanda Chihota

tawanda@comm.ae

News editor: Michelle Kasper

michelle@comm.ae

SAlES & ADvERTISING

commercial consultant: Karl Hougaard

karl@comm.ae

+971 (0)50 400 1220

sales@comm.ae

PR oDUcTI oN

Art director: Tamara Eger

tamara@comm.ae

cIRcUlATI oN

Distribution manager: Roy Varghese

roy@comm.ae

Pursuit Mode Initiatives FZE Contributors’ opinions do not necessarily reflect those of the publisher or editor and while every pre-caution has been taken to ensure that the information contained in this journal is accurate and timely, no liability is accepted by them for errors or omissions, however caused. Articles and information contained in this publication are the copyright of DVV Media Middle East (unless otherwise stated) and cannot be reproduced in any form without the written permis-sion of the publisher.

Printed by UPP, UAE

shaping the debate at World 2012 include megatrends, such as the ageing global demographic or the shift in economic power from West to east; industry dynamics, such as the emergence of new players or consumer-driven growth; and technologies such as cloud computing or M2M. Understanding the challenges and unparalleled opportunities arising from this transformation is critical to success in public and private sectors, developed and developing markets alike and across all industry sectors, not just ICt.

Tv connect MENA 2012ocToBER 30-31, 2012

DUBAI, UAE

hTTP://WWW.IPTv-MEA.coM/

tv everywhere is here. We launch a brand new event title for our much acclaimed IP&tv forum MeNA that hosted 750+ visitors in 2011 with one third of those from board, CXO and director level. the

rebranded event is tv Connect MeNA 2012. We’re maximising our brand potential through a future forward name that addresses all the exciting aspects of tv delivery including IPtv, Otttv, multiplatform services and interactive content creation.

Operator partner for the show remains etisalat, which is preparing an Ott focus day on October 29 in cooperation with Informa. they will also organise an App Developers competition at Khalifa University for apps that work seamlessly on all platforms: set top boxes, tablets and tvs.

tv Connect MeNA is the only major tv event in the region that will include all tv providers in the connected tv delivery ecosystem. It has created a level playing field for creatives and technology developers alike to bring the next generation tv experience and introduce services like pause, rewind, catch up and fast forward in the linear tv package.

40 www.Comm.ae

www.comm.ae

their network in rural areas to accom-modate these communities.

furthermore, the data market also remains hugely untapped in Africa. In a report by the gSM Association, 96 per cent of mobile subscriptions in Africa were prepaid voice services. Over time, we anticipate data to become a more popular choice and this would mean more investment in base stations/tow-ers.

comm.: What trends can be seen in Africa in tower sharing amongst network opera-tors?

ID: A number of tower sales to third-party operators have recently been announced. Operators are seeking to: firstly, monetise their assets to fund future roll outs; secondly, reduce their operating costs by securing a lower rental rates; and lastly, to roll out fu-ture towers without significant capital allocations

tower sharing in Africa is becom-ing increasingly widespread and this trend will continue into the foreseeable future as operators realise the contri-bution of sharing infrastructure in relation to maintaining profitability. As new technologies (4g and broadband) are rolled out and investments made in licence acquisition, many operators will come under increasing pressure to share deployment costs and share infrastructure. Sharing will also enable operators to spread the risk of the early

comm. café

an african story

Comm. included comments from Issam Darwish, CeO of Nigeria-based independent towers company, IHS in its general feature regarding the dynamics of the industry on the continent. Here, we undertake a more detailed Q&A session with him to discuss what the industry looks like from his company’s perspective

comm.: Why does the independent tower company business appear to have picked up quickest in Africa as opposed to other emerging markets?

ID: there have been some incredible changes to the African telecommuni-cations sector over the last five to ten years. In the past, sub-Saharan Africa was characterised by low telephone penetration, slow network growth due to variations in local network infra-structures, political instability, poor strategic planning from governments, lack of skilled labour, underfund-ing and poor strategic planning from stakeholders. this has changed over the last few years, with governments implementing telecommunications policy reforms, paving the way for pri-vatisation and allowing operators to be independently managed. this has also led to an increase in greater investment as investor confidence returned to the continent.

Other reasons could be attributed to the fact that Africa is home to over one billion people, of which 70 per cent live in rural areas. these people have created a high demand for telecommu-nications services. Previously, installed network capacity was low in Africa, especially in rural areas. As time went by, the urban areas were developed but the rural communities continued to lack the infrastructure even though the demand remained high. Operators are now playing catch up and rolling out

stages of network-building, where there is low penetration.

Also, regulatory bodies are increas-ingly becoming aware of the benefits of infrastructure sharing and are expected to place a greater emphasis on operators sharing infrastructure pos-sibly by offering incentives to promote sharing.

comm.: What is the scope of IhS’ activi-ties on the continent, and what are the company’s growth plans?

ID: IHS has been in the sub-Saharan African tower market with operations in Nigeria, Sudan, Kenya and ghana for a little over a decade now and although it began by building towers on behalf of mobile companies, it has now expanded its offering to building buy-to-let towers as well.

the company employs over 1,000 people and has a strong operational track record, to date having: built more than 2,000 sites; managed more than 4,000 sites; and owning 900 co-loca-tion sites.

comm.: Would IhS look to expand its base of operations outside of the continent?

ID: We are continuously on the look-out for opportunities across Africa and the Middle east. Both regions offer the right combination of wireless demo-graphics, population size, stable politi-cal climate and ease of operating.

Stay tuned for Arab Advisors’ insightful cellular landscape report covering ten sub-Saharan African countries. The report - Untapped Potential: Africa’s Remaining Growth Markets in Focus - provides in depth analysis of cellular market and consumer trends in each of the countries under review. Prepared in cooperation with Dubai-based telecom information platform Pursuit Mode Initiatives FZE, the report is ready for delivery in June 2012. The comparatively low penetration rates in Africa have been attracting global and regional investors to roll out and acquire cellular networks. The Arab Advisors’ sub-Saharan Africa report focuses on the countries of Democratic Republic of Congo (DRC), Ethiopia, Ghana, Ivory Coast, Madagascar, Mozambique, Senegal, Tanzania, Zambia, and Zimbabwe.

Highlights include:

• Overviews of political, economic and cellular regulatory landscapes.

• Market dynamics on a country level, including five-year market projections including subscriptions and revenues.

• Profiles and analysis of pan-African mobile operators.

• Analysis of emerging trends in sub-Saharan Africa’s cellular market.

• Investment opportunities in the region.

Arab Advisors Group AfricA-focused reportUntapped Potential: Africa’s Remaining Growth Markets in Focus

COMInG SOOn

FOR FURTHER DETAIlS OR EnqUIRIES TO PURCHASE THE REPORT, COnTACT Karl Hougaard, Commercial consultant, Tel. 971 50 400 1220, karl@comm.ae