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Mobile cellular communications i

VIEWS: 7 PAGES: 22

									  Mobile cellular communications
  in the Southern African region:
  Universal access considerations
                Michael Minges, ITU
                    minges@itu.int
The views expressed are those of the author and may
 not necessarily reflect the opinions of the ITU or its
                       Members.


        Workshop on Telecommunication Reform
          Gaborone, Botswana 3-5 May 1999
      Workshop on Telecom Sector Reform, Botswana, May ‗99




Topics

 Mobile cellular trends
  in Southern Africa
  region
 Regulatory issues
  related to mobile
  cellular




                                                             2
      Workshop on Telecom Sector Reform, Botswana, May ‗99



Mobile cellular
in the SADC region
                                      Southern African
 Status                              Development Community
 Growth
 Substitution
 Strategic investment
 Pre-paid
 Roaming




                                       Source: RTR (http://rtr.worldweb.net).


                                                                                3
      Workshop on Telecom Sector Reform, Botswana, May ‗99



SADC Mobile
Cellular Status
                                       Mobile cellular start-up
 Mobile cellular fairly               SADC countries
  recent to region                                             Tanzania
                                                               Sep. 94
 All SADC countries
  now have mobile
                                          Angola                   Mozam-
  cellular                                Feb. 94     Zambia        bique
                                                      Aug.95       Nov.97
 All except one have                                                   Zim-
  GSM               Namibia                                            babwe
                                                                       Sep.96
                            April 95
                                                                    Swazi-
            Penetration                                              land
                > 5%         Botswana                               Nov.98
                ~ 1%         June 98           South             Mauritius
               0.2 - .05%                      Africa            May 89
                < 0.1%                         June 94
                                                           Lesotho
                                                           May 96            4
                                            Source: ITU.
     Workshop on Telecom Sector Reform, Botswana, May ‗99




Mobile growth

 Over 100% growth                  New telephone subscribers in
                                       SADC countries (000s) *
  (excluding South                 250
  Africa)                                    Mobile                    0.21
                                   200
 Almost as many new                         density
                                                            Fixed
  mobile as fixed                  150
  subscribers in 1998
                                   100                      0.10
 Penetration doubling
                                    50            0.05
  every year                                                  Mobile
                                      0.02
                                      0
                                      1995        1996      1997    1998
                                     * Excluding South Africa

                                   Source: ITU.
                                                                          5
      Workshop on Telecom Sector Reform, Botswana, May ‗99




Substitution

 Mobile cellular quick                Mobile cellular as % of total
                                       telephone subscribers, 1998
  to implement; less                      South                           26
  prone to vandalism                      Africa

 Low connection fee                 Mauritius                       20
  (compared to fixed);
  generally little wait               Tanzania                       20
  for service
 Mobile functionality                 Namibia                  16

  advantages
                                        SADC*                   15


                                    * Excluding South Africa.
                                    Source:ITU.
                                                                           6
          Workshop on Telecom Sector Reform, Botswana, May ‗99



Strategic foreign
investors
             Mobile         Foreign
Country      Operator       Investor                   Stake
Botswana     Vista          France Télécom             51%
Botswana     Mascom         Portugal Telecom           49%
Lesotho      VCL            Vodacom (South Africa)     51%
Malawi       TNM            Telekom Malaysia           60%
Mauritius    Emtel          Millicom (Luxembourg)      50%
Mozambique TMM              Deutsche Telekom           26%
Namibia      MTC            Telia (Sweden)             26%
South Africa Vodacom        Vodafone                   32%
Swaziland    Swazi MTN      MTN (South Africa)         31%
Tanzania     MIC            Millicom (Luxembourg)      57%
Tanzania     TriTel         TRI (Malaysia)             60%
Zambia       Zamcell        Telecel (USA)              70%
Zimbabwe     Telecel        Telecel (USA)              40%
Source: ITU.

                                                                 7
      Workshop on Telecom Sector Reform, Botswana, May ‗99




Prepaid

 Provides access to                        Vodacom South Africa
                                         Prepaid subscribers, 000s
  those who might not
  normally qualify                         As % of total           53%
                                              cellular
 Accounts for                              subscribers
                                                                   953
  majority of new                                            37%

  subscriptions in                                27%
                                                             480
  many networks
  around the world                                262
                                       11%

                                        58
                                     'Mar-97 Mar-98 Sep-98 Dec-98

                                   Source: Vodafone.
                                                                         8
      Workshop on Telecom Sector Reform, Botswana, May ‗99




Roaming

 Extra revenue source              GSM Roaming in SADC
                                               L M M N T Z Z    TOTAL
 Can help spur                                S Z U M Z A W SADC World
                                    Lesotho                    1
  regional                          Mozambique                 2    6
  integration                       Mauritius
                                    Namibia
                                                               2
                                                               2
                                                                    33
                                                                    20
 Not yet widely                    Tanzania
                                    S. Africa
                                                               1
                                                               6
                                                                    4
                                                                    69
  implemented                       Zimbabwe                   1    9
                                   Source : ITU adapted from GSM MoU.


         ―For countries
          like Lesotho,
        roaming makes
        up much of the
         total revenue‖
           —Vodacom
                                                                        9
     Workshop on Telecom Sector Reform, Botswana, May ‗99



Regulatory issues for
mobile cellular
 Market structure
 Licensing
 Universal access obligations
 Pricing
 Consumer issues




                                                            10
       Workshop on Telecom Sector Reform, Botswana, May ‗99



Market participants &
competition
                                          Cellular market structure
 Private sector                          SADC countries
  participation                                                              Tanzania
  – All SADC countries
    except one                                                                  
 Competition                                    Angola
                                                              Zambia          Mozam-
  – 6 SADC countries                                           
                                                                                bique
                                                                      Zim-
                                                                     babwe
                                                                       
                                                Namibia
      100% state-owned                                      
                                                          Botswana
      Fixed PTO+private investors                                               Swazi-
                                                                                  land
     Competitive with fixed PTO participation                         
     Competitive no fixed PTO participation           South                  Mauritius
                                                      Africa
    Number of mobile operators                                      Lesotho
                                                                                
                                                                                        11
                                                   Source: ITU.
      Workshop on Telecom Sector Reform, Botswana, May ‗99



Strive Masiyiwa:
Cellular folk hero
 Fought 4 years for                         “We aim to provide
                                         telecommunications to all
  cellular license in                    the peoples of Zimbabwe”
  Zimbabwe
 Finally launched
  ECONET in June
  1998
 Part-owner of new
  Botswana cellular
  network


                                                                     12
      Workshop on Telecom Sector Reform, Botswana, May ‗99



Mobile cellular
licenses
 How many
  – How many operators
    can market bear?
 How long
  – Time period of license
 How much
  – License fees will be
    passed on to
    consumers
 How about
  – Coverage obligations
  – Technology                  “[License fee] is small because we
  – Scope                       wish to lower the cost of entry, so
                                 as to facilitate affordable tariffs”   13
                                               —SATRA
      Workshop on Telecom Sector Reform, Botswana, May ‗99



Universal access
obligations: coverage
 Outside of South
  Africa, coverage
  typically limited to
  major towns
 Licenses should be
  linked to population
  and territorial
  coverage targets
 Global mobile
  satellites may help

                                                             14
      Workshop on Telecom Sector Reform, Botswana, May ‗99



Universal access
obligations: payphones
 SADC mobile                        Community cellular pay phones
                                           in South Africa
  operators have had                35'000
  few if any universal              30'000
                                                 MTN
                                                 Vodacom
  access obligations
                                    25'000
 Exception is South
                                    20'000
  Africa where they
                                    15'000
  had to install 30‘000
  cellular payphones in             10'000

  5 years                            5'000

                                         0
                                             1994 1995 1996 1997 1998

                                    Source: ITU adapted from Vodacom, MTN.
                                                                             15
      Workshop on Telecom Sector Reform, Botswana, May ‗99




Tariffs

 Still high relative to                  Mobile cellular tariff,
                                         100 minutes, US$, 3/99
  fixed and compared                       Malawi        $14
  to other regions
                                        Mauritius          $20
 Significant regional
                                     Mozambique                              $71
  variation
                                          Namibia               $35
 Biggest barrier to
                                     South Africa              $33
  mobile access
                                          Zambia                       $55
 Reasons why
                                       Zimbabwe           $19
   – ―High retention‖
   – Interconnect charges                   SADC                 $39

   – Handset & service
                                    Source: ITU adapted from published
     provider subsidies             operator tariffs.
                                                                                   16
      Workshop on Telecom Sector Reform, Botswana, May ‗99




Tariffs & competition

 Competition can help
  to lower tariffs




                                    Source: Net*ONE (Zimbabwe).
                                                                  17
       Workshop on Telecom Sector Reform, Botswana, May ‗99




Handsets

 Factors affecting
  handset prices:
   – Custom duties
   – Distribution policy
   – Subsidies
 Minimum prices
  range from zero
  (bundled with
  subscription
  package) to US$ 400

                                                              18
      Workshop on Telecom Sector Reform, Botswana, May ‗99




Affordability

 With current tariffs,                Mobile cellular subscriber
                                       2005 forecast, SADC*, (m)
  mobile subscriber
                                                     2005        2005
  penetration in SADC                   1998       current      cost+
  (excluding South                                  tariffs     tariffs
  Africa) will rise over               Mobile
                                                                 4.4%
                                       density
  next 5 years to
  around 1%                              Subs-
                                        cribers                   4.5
                                                     1.1%
 With best practice
                                         0.2%
  tariffs, mobile                                     1.1
  density can rise to                     0.2

  4.4%                               * Excluding South Africa

                                    Source: ITU.
                                                                          19
      Workshop on Telecom Sector Reform, Botswana, May ‗99




Other consumer issues

 Calling Party Pays
 Mobile Number
  Portability
 Quality of Service




                                                  © MACH
                                                             20
            Workshop on Telecom Sector Reform, Botswana, May ‗99




Conclusions

                                           Mobile cellular
                                            enhances access to
                                            communications
                                           Must not be viewed
                                            as service for
                                            privileged
                                           Requires regulatory
                                            encouragement to
                                            extend access to all


                                                                   21
©ITU / A. de Ferron

								
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