MCI INTERVIEW
MCI INTERVIEW
mike.hibberd@informa.com
Vital information
As the African wireless communications industry descends on Cape Town for AfricaCom—the
largest event in the sector’s calendar—Mike Hibberd talks to Vitalis Olunga, chairman of GSM Africa.
F
verseeing the mobile commu-
nications sector of a continent
as diverse as Africa is a ma-
jor challenge. The variation between
extremes is enormous. At one end
of the scale is South Africa, with a
GDP of $255bn according to world
bank figures for 2006. South Africa’s
mobile subscriber base sits at more
than 41 million (according to Informa
Telecoms & Media’s World Cellular
Information Service), penetration is
above 90 per cent and the market
leader, Vodacom, has an operational
HSDPA network.
At the opposing end of the spec-
trum are markets like Sierra Leone.
Politically unstable, with a GDP of
just $634m, penetration is under seven
per cent. There are less than 800,000
cellular subscribers in the country
and there is no 3G at all. Vitalis Olunga, speaking at last year's AfricaCom event
Vitalis Olunga, chairman of GSM
Africa, the regional interest group of
the GSM Association— and head of the made by the [region’s] regulators. The regulatory framework is such that if
International and Wholesale Services regulatory environment is changing, you are a foreign investor you have to
Department at Safaricom Kenya—re- whereby now they are allowing more team up with a local company.”
lies on a network of representatives operators into the market. Most of the Olunga is satisfied that the strategy
in the region to feed into the central markets are opening up at the moment. is reaping rewards. “I would say that
office. Employees of Celtel Nigeria, That is something that I would say is is working well because, as well as
and Vodacom DRC are among those happening in most of the countries. A the growth that it is stimulating, it
keeping Olunga abreast of regional few haven’t opened up fully. But they is also driving down the prices to a
developments. are now following what is going on in level which is more affordable. The
Overall, Africa is characterised by other parts of Africa,” he adds. penetration is increasing, and that’s
the tremendous potential that it offers African regulators are driven by good because that is the way that we
for growth. Olunga reports that pen- the scenes witnessed in other parts can measure that it is working well.”
etration across the continent stood at of the world, Olunga says, in their Price, of course, is a major challenge
26.15 per cent at the end of Q3 2007— bid to stimulate competition. But they in developing markets, and nowhere
with mobile in a strong position. The are also keen to keep African carri- more so than in Africa. It is by no means
mobile to fixed line phone ratio in ers—many of which are tied to their possible to put a phone into the hands of
some markets is as high as 30:1. state governments—involved in the every African, meaning that the region’s
“The trend is that the growth is still growth and investment. operators have had to rely on inventive
taking place in most parts of the conti- “Most of the operators involved strategies to connect the unconnected.
nent because the rural population has are from within Africa,” says Olunga. “The more that people are connected, the
not yet been covered in most cases,” “Many operators are run by the gov- more they can get going,” says Olunga.
says Olunga. In most African nations, ernment and they are partnering with “The needs of the people is what makes
he adds, 80 per cent of the population the foreign investors. So some of this the operators be innovative. The needs
reside in rural areas. investment is coming from outside of the people are what matters.”
The push into these parts of Af- Africa. As the market opens further, He goes on: “I would say this is a
rica has been helped by regulatory you’ll find that those that apply for the challenge because not all Africans can
initiatives, Olunga reports. “We find licences will come particularly from afford phones in the rural areas. But
this is helped by some of the policies the Middle East. In most cases the there are community phone services.
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