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Cablegate on African broadband: Sept-Nov 2009 (South Africa, Nigeria, Tanzania)

September 9, 2011  »  Broadband & BusinessNo Comment

Quite a few WikiLeaks cables deal with the behind-the-scenes of African broadband affairs. The various dialogues regarding the telecoms situation in Africa are surprisingly detailed and often proceed for well over a dozen paragraphs. Essentially, the United States routinely monitored the economic prospects in each country and provided updates to Washington.

wikileaks

{WikiLeaks}

Using CablegateSearch.net we have listed the “juiciest” cables (if African broadband can be described as such), below. Many of the cables are extremely telling of what goes on behind closed doors and how the U.S. viewed African telecoms prospects from at least 2006-2009. The sentiments within the U.S. government probably still ring true today.

Summaries and notes will be listed in approximate reverse chronological order. Next up are three cables from September-November 2009. The main themes are privatization, Seacom, and end-user cost-reduction:

South Africa

  • Summary: More operators are allowed under the Zuma administration (compared with the Mbeki administration) and liberalization is improving ICT capacity. However, parastatals like Telkom will be around for years to come.
  • U.S. viewpoint: The pace of liberalization is encouraging for the entry of new foreign operators who will increase the level of service. Medium and small businesses will soon be able to have e-commerce services. There is great potential to connect rural areas and create large-scale ICT training systems. However, service quality will suffer until privatization is complete.

Notes:

  • Many policies of Telecommunications Act of 1996 didn’t get implemented for nearly 10 years.
  • Neotel began operations in 2005 as the second fixed-line operator. The company supported SEACOM and last-mile projects.
  • Although very real, piracy concerns may have been used politically to conceal the delay of the SEACOM project. (The language used in the cable is “politcally expedient.”)
  • Financial incentives will be needed to encourage rural infrastructure and would be unprofitably at the start.
  • Link: Foreign Operators And Privatization Increase Competition In Ict Sector, Sag Still Favors Parastatals, November 9, 2009

Nigeria

  • Summary: ICT growth is expected to take off by 2011. As bandwidth is expected to triple, companies will need efficiently deliver the data via 3rd parties (and wireless).
  • U.S. viewpoint: ICT regulations are needed. Nigerian telecoms wish for multiple companies to share cell towers and for a new ISP to afford new fiber services like Main One and Glo. Internet access will benefit from WiMAX until fiber can reach rural areas.

Notes:

  • Main One cable expected in Lagos around March 2010 and Glo is expected around that time. (These were on time)
  • Only 20% of fibre network is actively used as of late 2009.
  • Telecoms operator IHS is eying “dark fiber” (fiber with no light).
  • Each cell tower uses 60 liters of diesel per week which, in turn, costs 6,000 naira.
  • Solar and wind power are hindered by high tariffs on batteries. Solar lacks a national grid to support it.
  • Potentially 3-5 years of profit-making until the telecoms market matures.
  • 5% Internet penetration and 45% cell phone market penetration.
  • 30 million youth who will want a new handset every 6 months.
  • Link: Nigeria’s Ict Network: Build It And They Will Come, October 15, 2009

Tanzania

  • Summary: The Seacom undersea cable made its landing in mid-2009 amid great fanfare. However, distribution and regulatory challenges remain. The government’s anti-competitive approach only keeps costs inflated and prevents broadband from reaching inland areas.
  • U.S. viewpoint: Seacom and EASSy can transform the ICT landscape in Tanzania but must be properly managed. In all likelihood, parastatal TTCL will prevent the nation from enjoying these benefits.  In essence, Tanzania needs better economic planning. rogress has been slow because of bureaucratic, regulatory and policy hurdles.  Tanzania appears unlikely to take advantage of the correlation between broadband penetration and GDP growth. Additionally, areas outside of Dar es Salaam are extremely under-served. Kenya, Uganda, and Rwanda are leaving Tanzania far behind by building numerous publicly and privately funded terrestrial fiber networks at national and municipal levels.

Notes:

  • Prior to the Seacom cable, the east coast of Africa was the “longest populated coastline on Earth without access to a fiber-optic cable.”
  • 1Mbps satellite connection cost $3000-6000/month (should be $50).
  • Seacom promised 80% lower broadband prices thanks to open access pricing.
  • Unconfirmed publicly and without NDA, but Seacom reportedly needs US $4-5 million minimum for a 20-year lease to the cable, with an extra $56,000 annually.
  • Bandwidth costs may not decrease until ISP satellite contracts expire, but ISPs agree that quality of service will at least increase.
  • TTCL charges US $130,000 per year for access to their infrastructure (vs. $4,800 in Kenya for the equivalent).
  • Rumor that the government declined a private offer of those with EASSy to build a national backbone with free access to the Tanzanian government.
  • China International Telecommunications Company was contracted in 2007 to build a fiber backbone, but the offer was inflated by 20%. Either way, the 10,000km project will connect all districts by 2012…
  • TTCL considered slow rather than greedy.
  • 3G and WiMAX will likely be alternatives to TTCL’s high prices, but bandwidth here is lacking too.
  • Rwanda, for one, would like Tanzania to quick its broadband adoption pace so that it can reap the benefits of a high-capacity international gateway.
  • Link: Stifled Potential: Fiber-optic Cable Lands In Tanzania, September 4, 2009

Tentative Post Schedule:
9/8/11: (2009) Kenya, Zambia, Ethiopia
9/9/11: South Africa, Nigeria, Tanzania
9/10/11: Tunisia, Kenya, South Africa
9/12/11: (2008) Senegal, South Africa, Uganda
9/14/11: (2007) Ethiopia, Rwanda, Kenya
9/19/11: Ghana, Kenya, Ethiopia, Kenya

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