How will the telecom players measure up in 2010 ?

The year 2010 is synonymous with a number of major events. One is the FIFA world cup of which its success can’t be tagged away from some of the continents technological developments.

The docking of yet another, optic fiber undersea cable called EASSy (of which the owners are targeting the FIFA event in South Africa), will definitely dictate the way we might use our mobile handsets and how we might be able to utilize the Internet.

In 2010 it is largely believed that with the landing of EASSy there will definitely be a rebirth of a bandwidth ‘price war’ amongst regional telecoms.

In Rwanda, while reflecting on 2009, the telecom industry has already been shaken by the entrance of the Tigo Rwanda, which is largely owned by the Millicom International in Luxemburg.

While Rwanda’s mobile penetration rates are still staggering, as compared to those in the region, the UN’s International Telecommunication Union (ITU), estimates that there is only one mobile handset per eight Rwandans.

Prior to Tigo’s entry there were almost 1.8 million subscribers. Tigo’s presence should therefore not be underestimated as it definitely would contribute to the increase of subscribers and contribute to government’s projection of having some 6 million mobile users by the 2012.

Expectations from Tigo

With the company’s triple ‘A’ strategy, Tigo had earlier beaten the might of Zain and Telecel Globe to win the third national operator licence in Rwanda and later launched with an immediate coverage in 13 districts. The company intends to cover the whole country by 2012.

As we sail through 2010, we should also expect that Tigo will put more energy in consolidating its presence both in the country and across the region.

Tigo announced that it would rollout a low-cost regional roaming facility with its networks in neighboring DR Congo and Tanzania.

Forecasting telecoms in 2010
 
The year 2009 was quite resourceful in many ways. Tigo’s going on-line preceded the docking of another, 1.28Tbps capacity, submarine cable called SEACOM, of which Rwandatel and Altech Stream are already connected, through mico-wave technology.

For the year 2010, Rwanda’s telecom industry might therefore be dictated by these events, the presence of a third national operator and the launch of another undersea ca   ble.

In the same year we might also look out for technological innovations from all the three telecom players. The telecoms for sure will juggle their tariff structure to consolidate their subscriber base and to attract more users, something that will definitely raise the country’s tele-density.

There are a lot of activities in the telecom sector that are lined up for the year 2010. In 2009 these telecoms were quite optimistic that the national fiber optic backbone, meant to connect all the 30 districts would be up and running.

The questions are: Will the bandwidth be fast and affordable? Shall we be able to ‘Skype’ using our phones and what will be the cost of GPRS?

We shall also ask ourselves whether MTN Rwanda’s mobile banking facility will be able to bully the already established banking and financial institutions.

And finally, we shall ask ourselves whether we shall be able to watch the world cup ‘live streaming’ using our smart mobile phones?

Innovations in 2010
 
Rwandatel official have already said they are soon launching the BlackBerry service. With a BlackBerry, two users from two different telecom companies, can utilize the ‘Google Talk’ applet and chat way, faster and freely without having to spend money.

This could lead to a decline in some revenues for the telecom operator.

The telecom industry is quite multifaceted. The industry involves quite a number of dynamics which makes it hard to predict. Prospects for the future are therefore quite uncertain.

In 2010 all eyes will be on the major players MTN Rwanda and the LAP Green owned Rwandatel and a lot of expectations from Tigo Rwanda.

The other major player to watch will be the regulator, the Rwanda Utilities and Regulatory Agency (RURA) and how the institution will tackle the issue of inter-connectivity of which MTN Rwanda and Rwandatel locked horns early this year.

Regionally, according to the African Economic Outlook Report 2009, the share price of major players on the continent fell heavily during the year. MTN fell by 20 percent and Millicom by 66 percent.

Going by these figures locally, we shall definitely expect stiff competition in 2010, something that is likely to scale down on the high profits that have always sustained capital and infrastructural investment of telecoms.

And while the world economy is still fizzing with the spills of the global financial crisis, telecom companies will turn to banks for ‘bail out’ facilities for network up-grades.

In 2010, MTN Rwanda will commercially launch her already existing 3G. Though Tigo launched operations with the installation of 3.5 in some parts of Rwanda, experts believe that the telecoms are, likely to delay fourth generation networks.

However with the, per-second billing facility offered by almost all the telecom players, a call for every second is likely to drop within the course of the year to way below Rwf1.

What else do we expect in the year 2010? Telecom operator are likely to face continued challenges that most African telecoms face, the lack of reliable, affordable energy solution to run base stations.

The Numbers

99.5 

The percentage of Rwandatel’s market share of fix telephony

30 

The number of districts the national optic fiber loop will connect by 2010

88.6

The percentage of MTN Rwanda’s market share of mobile telephony in 2009

1.28

Tetra bytes per second the bandwidth capacity of SEACOM cable which Rwandatel is connect to

keziodk@yahoo.com