6 November 2012

Namibia: Titanic Battle Looming in Telecom Sector

Article Views (non — Competition in Namibia's telecommunication market is about to intensify with Mobile Telecommunications Company (MTC) publicly admitting that it will soon roll out fibre-optic telecommunication connections to businesses, and eventually to households.

Even though the rollout is expected to take place toward the second quarter of 2013, it is a business step that will amplify the competition with Telecom Namibia. Telecom Namibia has already ventured into mobile telecommunications with the acquisition of the heavily indebted Leo, the second mobile telecommunication network operator.

MTC received a Natural Licence six months ago, which is different from the previous mobile licence, which does not restrict its services to mobile telecommunications.

"Now we are not only mobile [company] but we can lay cables to offices, and that is our first target," MTC's managing director Miguel Geraldes revealed during the Portugal Telecom (PT)'s Technology and Innovation Exhibition in Lisbon, Portugal, that took place on October 29 and 30.

MTC is so ecstatic about the future that its board of directors - and by extension PT Portugal that has a 34 percent shareholding in MTC - has approved N$1.3 billion in the next three years on the new business direction. The company currently has an annual turnover of N$1.6 billion.

Geraldes says there are still a number of issues to sort out before these new services become a reality. "For instance, we still have to sort out the billing," he says.

For MTC however the rollout of fibre-optic connections to businesses and households heralds the dawn of new innovative services for Namibian consumers, although Geraldes was very reluctant to jump the gun on the types of services the company intends to offer.

Nevertheless, judging by the directions PT is taking, it is safe to say the rollout of fibre-optic connections to businesses would open up the space for MTC to offer innovative digital services that bundle digitalisation, mobility, and virtualisation of content and communications.

One of the specific offerings that MTC is keen on, revealed Geraldes, is to offer virtual content storage space for companies - sort of on a small-scale, 'cloud' services for now. The rollout also signals the end in the marathon negotiations between MTC and the City of Windhoek on the rolling out of fibre-optics in the City of Windhoek.

Windhoek, which is increasingly under pressure to find alternative sources of revenue had wanted a share of proceeds in the revenues generated from MTC's new fibre-optic cable. Geraldes confirmed that they have reached an agreement that is favourable to both parties.

"We have agreed on a model sharing with the City of Windhoek, where we install four ducts [of fibre-optic] but we will only use one leaving the other three open for rent," he said.

MTC has invested over N$150 million in the 14.500km-long submarine cable WACS (West African Cable System), which landed successfully in Swakopmund during February 2010.

To roll out the fibre-optic cable in the country another investment of over N$100 million was made, which also allowed the introduction of the fourth generation (4G LTE) technology in Windhoek and soon in other parts of the country.

The 4-fibre pair system is designed to support present and future Internet, e-commerce, and data, video and voice services in Africa, everything at a very high speed.

With the arrival of the cable, MTC secured fibre backbone connectivity with the same DWDM technology and with a bandwidth of 40 Gigabits per second. This backbone will transport MTC capacity from the landing station at Swakopmund throughout the country.

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