Africa: GSM Operators Set to Capture Africa’s Largest Market

8 August 2001
allAfrica.com
By By A Special Correspondent

Lagos — With the launch Wednesday by MTN Nigeria Limited of its GSM operations, the scene appears set for the race to capture Africa’s largest telecommunications market. Two days ago, Econet Wireless, another winner of GSM licence in Nigeria, commenced operations. "It’s a milestone, but just the beginning of hard work," Tunji Adeyinka, Sponsorship Promotions and Events Manager at MTN, said in an interview with allAfrica Wednesday. Starved of telecommunications services for years, Nigerians are eager to take advantage of the opportunity created by the introduction of the digital mobile telephony. For a country with more than 120 million people, the total installed fixed telephone lines are currently put at about 700,000, with about half of that said to be unconnected. Econet Wireless said it plas to connect 100,000 from its launch to the end of this year. After that, said an official Monday, there would be an "explosion" which would see the company connecting as many as 750,000 lines. MTN has an even more ambitious plan. According to Adeyinka, MTN will connect 100,000 lines within its first month of operation. Thereafter, it would add more lines every month. "We are going to exceed the licensed stipulation," says Adeyinka. The GSM operators know the challenges ahead. "There is a lot to be done," acknowledges Adeyinka. "For everyone you put on the network, there will be a lot of work on capacity and hardware," he said. He said MTN, the South African company, would strive "to improve on what we’ve started, make sure that our customers get quality service." There were doubts last week over the commencement of the GSM operations by the August 9 deadline. State-owned Nigerian Telecommunications, currently the sole national carrier and also a winner of a GSM licence, said it would be able to interconnect only 5,000 lines for each of Econet and MTN. Earlier projections had put the initial roll-out lines at 100,000 for each of them. NITEL gave the congestion of its network as the reason for the reduction. It took the intervention of President Olusegun Obasanjo to get NITEL raise the number of lines to interconnect. At a meeting with officials of NITEL, as well as officials of Econet and MTN, Obasanjo stressed the need to keep to the roll-out deadline of August 9. Both companies launched ahead of that deadline. Tariffs announced by the two operators received criticism from Nigerians. But at launch Monday, Econet reduced its tariffs for its corporate clients. For the peak period (7am- 7pm), it reduced the rate to 32 naira (111 naira = US$1) per minute for calls outside the Econet network, down from 35 naira per minute previously announced. For calls within Econet’s network, it reduced the corresponding rate for the corporate clients is 29 naira per minute For the off-peak period 7pm-7am, the rate for the corporate clients is 19 naira per minute, both within and outside Econet’s network. Econet had previously announced a rate of 21 naira per minute for this period. These changes, an official of the company explained, apply only to the corporate clients, known at Econet as Business Partners. However, MTN went ahead with it rates as previously announced. It retained its peak period rate of 30 naira per minute; 20 naira for the off-peak period, and 15 naira per minute as the low cost rate. Changes to the rates, says Adeyinka, would be market-determined. "We are a customer-led organisation. Let the market decides." Despite the expected high demand for GSM phones, MTN’s Adeyinka says Nigerians would not have to wait for long before getting their phones. He said MTN would from August 23 launch the pre-paid service, otherwise known as "call as you go." "When we launch pre-paid, ordinary Nigerians will be able to pick up their phones without difficulty," he said. MTN will at the same time extend its service to Abuja, the Nigerian inland capital, and thereafter to Port Harcourt, in the oil city in Niger Delta. The improvement will be even be more when NITEL commences its operations later in the year. This will come after completion of some on-going projects aimed at expanding NITEL’s network.

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