Security claims blocking Africa telecom deregulation

LUSAKA, ZAMBIA – Citing unspecified security concerns, Southern African governments are shying away from deregulating international telecommunications gateways.

Levy Mwanawasa, president of Zambia who is also the chairman of the Southern Africa Development Community (SADC), said countries that have opened up international gateway services to competition have encountered security problems, and that the new services were performing far worse than expected in the mobile communications market.

During the swearing-in ceremony of the new Zambian minister of Communications and Transport last week, Mwanawasa said that liberalizing the international gateways would put countries at risk.

Mwanawasa did not give specific examples, but political unrest in several African countries that have deregulated the telecom sector, such as Uganda and Nigeria, have resulted in rebel attacks. Nigeria’s mobile services are also widely criticized as unreliable.

Two pan-African private mobile phone service providers, Celtel and MTN (Mobile Telecommunications Network), have been pushing governments liberalize their international gateways by providing licenses to private operators to own and operate their own gateways. The mobile phone service providers blame international gateways, owned and operated by governments, for the high cost of telecom and the lack of investment in the mobile market — especially in rural areas — because the sector is uncompetitive.

“Celtel and MTN were foreign companies that should first ask their countries of origin whether or not they had liberalized their international gateways, before requesting other countries to do so. We do not want to temper with our security,” Mwanawasa said.

Celtel is owned by Zain of Kuwait and operates in 15 African countries including Nigeria, Chad, Burkina Faso and Sierra Leon. MTN is a South African company and operates in more than 21 countries in Africa and the Middle East including Zambia, Yemen, Uganda, Nigeria and Kuwait.

Acting SADC Chief Director Remmy Makumbe said that countries in Southern African region have deregulated mobile communications services within national borders, but not the international gateways. “In order to make radio communications competitive, the SADC region has … liberalized airwaves for radio communication,” Makumbe said.

International gateway licenses allow mobile service providers to have their own signaling access codes, rather than using government controlled access codes that monitor and record every call made.

In Zambia for example, private mobile service providers have to route their international calls through the Zamtel (Zambia Telecommunications Company). Zamtel is a government-run communication utility company providing fixed and mobile phone services. It has exclusive rights to the Mwembeshi Earth Station and collects revenue from private service providers using the satellite’s facilities, including international gateways.

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

The Zambian government pegged gateway licenses at US$12 million, which Celtel and MTN said they could not afford. In Kenya, the license cost is $214,000 while in Uganda it is pegged $50,000.

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