Liberalising the telecoms sector

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Desie Heita

Windhoek-Namibia is taking final steps towards the total liberalisation of its telecommunication sector – great news for local entrepreneurs hoping to enter into the industry.

The news will likely be met with jubilation in Europe, where the European Union (EU) had specifically been pushing for such a move during the protracted, and once stalled, Economic Partnership Agreements (EPAs) with Namibia. The liberalisation of the telecommunication market would allow local entrepreneurs to expand into a sector that for many has, without doubt, been nigh impossible to access, because of the technical requirements and, for certain industries, closed off through legal restrictions.

However, the provisions come with a caveat for new ICT players to respond to government’s quest for increased access to ICT services by communities currently sidelined by the high cost of services or the absence of infrastructure near them.

All eyes are now on the finalisation of process to dismantle the Namibia Post and Telecommunication Holdings (NPTH), an entity the EU has always seen as antithetical to the core developmental principles that the Namibian government seeks through EPA trade negotiations with Europe.

Information Minister Tjekero Tweya says the finalisation of NPTH Dismantling Bill is under way.
The Bill itself has already “been discussed by Cabinet and the Cabinet Committee on Legislation,” he said.
“Government’s direct involvement and shareholding in telecommunication corporations is something that the European Union was specifically not pleased with during the negotiations for the EPA with Namibia and SADC,” he said.
“The EU deemed this as monopoly and has wanted market liberalisation to include telecommunications,” Tweya noted in response to a range of questions regarding progress in the ICT sector.

He pointed out that in addition to the dismantling the NPTH, the country recently witnessed Cabinet embarking on steps to have local institutional investors, such as GIPF, step in as shareholders in telecommunication companies, especially MTC.

The minister’s comments come weeks after the Communication Regulatory Authority of Namibia (CRAN) threw open the competition doors, effectively granting permission to new entrants to set up shop and compete with MTC and TN Mobile.

Competition in the mobile market could also come from South Africa’s much-touted MTN, that together with two other entities have licences to compete with MTC and TN Mobile in mobile voice and data services.
CRAN has granted new licences recently, which expands the number of those being regulated to 57 licensees. These include 34 broadcasting service licensees and 23 telecommunication services licensees.

Although MTN has held its licence – through its Namibian subsidiary MTN Business Solutions – for the past 20 years, the new licence is issued to MTN Business Solutions, that is 30 percent owned by Namibian shareholders, as per CRAN regulations. The shareholding is held by Profile Technologies, a company owned by businessman Vaino Nghipondoka.

Tweya was emphatic that the new players in the telecommunication sector would have to recognise that “ICT development is a shared responsibility, the role of government in it is to ensure an enabling and conducive environment”.

Government is working on a new broadband policy that “not only focuses on supplying access to ICT services, but is also aimed at increasing the demand for utilisation of ICT through educating end-users in using such services responsibly and fostering confidence in using ICT as an integrated part of their daily lives,” he says.

In the meantime, government is tracking the progress with keen interest. Tweya points out that, “access to broadband services has increased from 42 percent to 53 percent in the past year and is still being expanded, as is evident from the various upgrades and extensions being undertaken by telecommunications licensees.”

CRAN has also imposed conditions linked to spectrum licences to ensure rollout of broadband services in more than 100 geographical locations, as well as services in 23 areas that have no coverage at present.

“These conditions were imposed with the aim to meet broadband targets as set out in the Harambee Prosperity Plan,” he said.

CRAN also completed its GAP analysis and recorded all ICT infrastructure and power grids onto a GIS system that indicates the presence or non-presence of ICT in villages, schools and clinics.

“This data will be used to enforce roll-out obligations onto licensees to provide ICT access in areas that have no access to ICT services. Presence of financial services is also captured in this database to also assist with financial inclusion strategies by the financial sector.”

Tweya further said by implementing the infrastructure sharing regulations and setting up number portability CRAN created a more level playing field by lowering the barrier for new ICT players in the market.

“The infrastructure sharing regulations provide for active and passive infrastructure sharing and opened the door for national roaming agreements between licensees.

“Licensees are now obliged to share ICT infrastructure, like towers, feeders, antennas, ducts and fibre cables. This will avoid duplication of investment in new infrastructure and licensees can now focus on investing in access and services,” he said.

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