World Telecommunication Day 1998

May 4, 1998

A Chance for Change in Africa?

For Africa's new generation of private telecommunications companies and information technology specialists, the continent's all-too-familiar setbacks to effective communications are both a challenge and an opportunity.

Even amid the chaos in former President Mobutu Sese Seko's Zaire (now the Democratic Republic of Congo), a local businessman, Miko Rwayitare, established one of Africa's most successful enterprises. From small beginnings in Kinshasa in the late 1980s, his mobile telephone company, Telecel, soon reached the country's major cities and even expanded its services into other parts of Africa, including Côte d'Ivoire (where it is the leading mobile telephone operator), Madagascar and Zambia.

Throughout Africa, markets for mobile phones, computers and Internet services are booming. There is hardly a capital city that cannot offer at least one mobile telephone service. And Internet service providers have sprung up nearly everywhere - at the latest count there were 36 countries fully connected to the Internet.

President Bill Clinton's parting words at the end of his recent six-country African tour - ''Despite the daunting challenges, there is an African renaissance'' - seem particularly appropriate for developments in the continent's telecommunications sector. All of the countries Mr. Clinton visited have created a competitive environment for substantial new investment. They are a testament to Africa's growing desire, in the president's words, ''to harness the winds of change.''

Senegal, for example, has just installed a digital fiber optic network to reach 100,000 new subscribers and has granted licenses to private operators to set up 5,000 telecenters, which offer fax or Internet services in all major towns. By these means, the Senegalese government hopes to ensure that no citizen is more than one hour's walk from a telephone.

South Africa has even more ambitious plans to increase telephone coverage by 10 percent a year up to the year 2002.

Africa, with an average telephone density of less than 2 lines per 100 people, may lag behind other world regions for some time to come, but the new winds of change are already blowing. Markets that have long stagnated are showing a potential for rapid growth, and technologies are evolving that can be made appropriate and adaptable to the conditions and challenges prevailing in Africa.

Albeit belatedly, most countries are now moving toward fully commercial operations. Governments have begun to sell substantial stakes in their networks to international operators. And nearly all are licensing private operators.

On the national level, Uganda has just awarded a license to a consortium led by South Africa's Mobile Telephone Networks (MTN) as a ''second network operator,'' with a pledge to invest about $100 million over two years.

Building networks quickly and cheaply

Even the smallest countries can benefit as technology costs fall. ''Very small groups can become telecommunications operators with very limited capital,'' says Jean Marchal, an independent French telecoms consultant.

New technologies are coming to the rescue of Africans who have never had or hoped to have a telephone. Wireless local loop (WLL) technology is particularly suitable, being cheaper than mobile cellular and quick to install, without the need for fixed wires. ''WLL provides a number of important advantages, including fast development, low installation and maintenance costs, low cost of initial per-subscriber infrastructure and shorter payback times,'' says Dirk Bout, a telecommunications analyst with research company Dataquest.

Innovations such as pay-phone services using cellular communications technology are of special interest to Africa's new and existing telecommunications operators. Over the past year, South Africa's MTN has installed several thousand pay phones, using a wireless pay-phone system developed by Finland's Nokia, in townships and villages that never had public telephones before.

The system, which uses phone cards rather than cash, is also adaptable for use in vehicles and at temporary locations, for events such as sports, entertainment and exhibitions.

WorldTel, an independent company set up by the International Telecommunication Union (ITU), is seeking to raise $500 million to bring the benefits of WLL technology to groups of countries in order to reduce installation costs to a minimum. ''The time has come to set a trend and to lead the way,'' says WorldTel Chairman Sam Pitroda. ''Even if our first investments are in only six, eight or 10 countries, that is good enough to make an impact. Africa cannot be developed without a telecommunications sector.''

If telecommunications is vital to development, Africa is more than ever ready to harness the latest technological advances. Assessing the evidence of recent privatizations and the spread of cellular and Internet services, ITU analyst Michael Minges says they reflect ''a growing continent-wide belief that a more liberal telecommunication sector will attract private investment and accelerate the construction of badly needed infrastructure and services.''

Richard Synge