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Digicel May Enter African Market - ANAC to Offer Three 3G Licences Later This Year
[July 26, 2010]

Digicel May Enter African Market - ANAC to Offer Three 3G Licences Later This Year


(AllAfrica.com Via Acquire Media NewsEdge) When the Cape Verdean regulator ANAC offered BWA licences, Digicel was one of the successful bidders. So when ANAC tenders for three 3G authorisations later this year, it looks reasonable to conclude that Digicel may well be one of the bidders: it has no data only operations anywhere else in the world. ANAC is seeking to keep the costs of the 3G authorisations low in order to develop the country's potential as an information society.



Three months ago the Cape Verdean regulator ANAC tendered five BWA licences: in the 2.5 GHz (mobile) and 3.5 GHz (fixed and nomadic) spectrum. There were six applications and among the lucky winners were Digicel and T+ (the country's second mobile operator). Since Digicel does not operate stand-alone data operations anywhere, it is reasonable to conclude that this bid was part of a wider interest in a voice operation. Those authorised have 6 months to start rolling out their networks.

Three 3G licences will be offered to successful bidders later in the year and these will come with a 2G authorisation for those who do not already have one. Authorisation costs will be kept low. According to David Gomes, President of ANAC:"We don't want money. We want them to make a financial contribution to developing the information society. They will have to propose a real plan to develop this." There are currently two mobile operators in this ten-island nation, CV Telecom (owned by Portugal Telecom) and T+, majortity owned by Teylium Telecom, the investment vehicle of Senegalese entrepreneur Yerim Sow. The most recent data from 2008 shows a total market of 277, 667 subscribers, a penetration of 55.56%. However, a more current estimate puts the figure at between 300,000 to 400,000.


In terms of Internet subscribers in the same year, there were the following: 7,380 ADSL subscribers, 1,825 dial-up subscribers and 4,865 GPRS subscribers. There are 627 Wi-Fi hotspots on two of the main islands. CV Telecom is now providing ADSL2 and IPTV services. CV Telecoms is a signatory to the WACS cable that will land later this year: currently survey work is being carried out. There is also a group looking at re-laying a cable on the former SAT1 route connecting Cape Verde via the Canaries to the USA.

Digicel's claim to fame is that it first launched in Jamaica and took a large portion of market share away from incumbent, Cable and Wireless, in a bitter struggle that has included law suits. Digicel was created by Irish entrepreneur Denis O'Brien who started in 1995 by launching Esat Digifone in Ireland (with Telenor) and who netted 317 million euros from a disputed sale. His other business interests include Sterling Energy (in which he has a minority personal shareholding) which has oil blocks in Mauritania, Cameroon and Madagascar.

Since then, he has built up Digicel as an operator with 10 million subscribers across 32 markets in Central America, the Caribbean and the Pacific: 7.2 million of these subscribers are in Central America and the Caribbean. In 2007 he rolled out WiMAX in Grand Cayman and in 2008 announced he would be working with Alvarion to roll-out in other locations in the group. In the main, Digicel has chosen to play in relatively small markets and as in Jamaica, has been the challenger in most of them.

So who would a new entrant like Digicel impact hardest on? CV Telecoms is about to be examined by the regulator as part of a study on dominant market power and this may lead to a number of new obligations being placed on it. So it might find the pressure of Digicel particularly hard although it has all the advantages of a long-established incumbent in a very small market. This means that it will probably be T+ that stands most to lose from whichever third entrant comes into the market.

(c) 2009 AllAfrica Global Media. Provided by Syndigate.info an Albawaba.com company

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