African countries invite foreign investors into their telecommunications markets at the Telecom Africa 2004 forum. Niveen Wahish studies the implications An assortment of information and communications technology (ICT) was on display at Telecom Africa 2004, an event seeking to discuss technological development in the continent and to promote a whole range of products. But while a lot of commercial marketing was going on at the exhibit area of the event, another sort of marketing was proceeding at the same time. African countries were inviting investors to jump into their ICT sectors. Throughout the forum event, the issue of the important gap between the products and the markets was addressed. Walda Roseman, CEO of CompassRose International Inc, a consulting firm in the area of ICT and electronic communications, attributed that gap to the fact that African countries still need to create an environment attractive for investment in ICT, infrastructure and services -- not just in the cities, but in the rural areas as well. Roseman pointed out that although much of the available technology is wireless and has a lot of the functional flexibility that would enable African countries to introduce voice and broadband services, these services are prohibitively expensive in many African countries. That, she said, is because regulatory regimes fail to create the competitive atmosphere that drives down prices. However, she added that there has been an enormous shift in the African regulatory culture and there are some leaders who have begun to work within their countries to promote the idea that opening the market will actually bring more capital in instead of draining capital out. "I see this next decade as a dynamic one for Africa, so long as these changes are backed by commitment at the very highest level of government and a commitment by the private sector," Roseman said. Michail Minges, head of the Telecommunications Data and Statistics Unit at the International Telecommunication Union's Telecommunication Development Bureau, holds a similar point of view. He said that one way for African countries to attract the technologies and services they need is by privatising and creating a suitable regulatory policy environment. "In order for investors to come in, the market needs to be open," he said, explaining that one of the reasons why mobile telephony has been successful in Africa is that it has been the one area which most African countries opened up to private investors who come in with the financing and know-how to build networks. According to The African Telecommunication Indicators 2004 Report, the total number of mobile subscribers in Africa stood at around 52 million at the end of 2003 -- in other words, double the penetration of fixed lines. The mobile penetration rate is expected to reach a possible 20 per cent in 2010. Such deregulation is also needed to enhance fixed-line networks, Minges believes. In fact, the report of which Minges was the lead author, said that the reason for the "sorry state of African fixed-line networks is that traditional incumbent operators are often majority owned by the state". While governments need to open up and deregulate, the digital solidarity fund will also come in handy in extending ICT services throughout the African continent. The fund is intended to provide financial support for ICT growth in developing countries. It was proposed by Senegal during the first phase of the World Summit on the Information Society held in Geneva in December 2003. It came up during the discussions in the final session of the Telecom Africa forum where speakers called on African states to use the New Partnership for Africa's Development (NEPAD) as a foundation for the fund. "Some 30 of 53 African countries have already formulated e-strategies, and their implementation will depend on what financial mechanisms are available for them," said Nadia Hegazi, Egyptian International Relations expert. She added that NEPAD's E-Africa Commission, which is designed to serve as an ICT development advisory body for African countries, is a starting point from which the fund could be developed. The Commission's offices were opened in Pretoria, South Africa last month. But the forum was not only about funding. A variety of technologies were discussed and the demise of the fixed line was questioned. "Fixed lines are cheaper, for consumers, but they are not cheaper to install or to maintain," said Minges. "Mobile networks are more attractive.'' Minges went on to say that what is becoming increasingly attractive is not the traditional copper line, but what is called the fixed wireless, based on Code Division Multiple Access (CDMA) technology. In Nigeria, this has captured 25 per cent of the fixed line market. It is cheaper than the conventional fixed line, it has higher speed and it enables governments to avoid the theft problems of the copper wires. Egypt itself is adapting CDMA in expanding its fixed-line network to areas where it is difficult to install regular fixed lines, either because of their remoteness or because of their high population density. It signed an agreement during Telecom Africa with ZTE, the Chinese telecommunication equipment manufacturer and solution supplier for the construction of a CDMA WLL network, with a capacity of 60,000 lines. Whether fixed or mobile, Africa needs every form of technology available to expand ICT services and Internet usage, particularly since fewer than six per cent of Africans have access to telecommunications at all.
