Zambia Awards International Gateway Licenses to Private Operators
After years of disagreement, the Zambian government has finally awarded private mobile-phone operators licenses to operate international gateways in a bid to bring down the high cost of communications.
Two service providers have been given licenses to access the international gateway facility that was previously exclusive to the government-run Zambia Telecommunication Co. (Zamtel), which is now being sold in order to bring it back to life financially.
A gateway fee had been paid to Zamtel -- in addition to fees for using Zamtel's satellite system -- by private service providers through the Zambian government. This resulted in unfair competition, with private service providers charging their customers exorbitantly in a bid to make profit and to sustain their operations.
Zambia Information and Communication Technology Authority (ZICTA) acting director General Richard Mwanza said in Lusaka last week that the move to award licenses to Zain and MTN would enable the two mobile service providers to lower their high international tariffs. Mwanza made the remarks at a meeting of CEOs at the Zambia Association of Chambers of Commerce and Industry.
The two service providers and various stakeholders, including the World Bank, had for years been expressing concern at the high cost of doing business in the telecom sector in Zambia, emanating from high license fees of about US$12 million that were required to access the international gateway.
But despite approving the licenses, the Zambian government will not say how much the new gateway licenses will cost until a new regulatory framework that will provide guidelines on the use of the gateway is put into place. Zambia's international gateway fee was the highest in the Eastern and Southern African region and was cited as a barrier to entry in the telecom sector. International gateway fees are pegged at US$214,000 in Kenya and $50,000 in Uganda.
The granting of international gateway licenses to the service providers is, among other things, the culmination of comprehensive consultations that have been carried out by the Zambian government in order to address concerns that service providers were raising.
"The granting of international gateway licenses to the two service providers will result in the competition in international services, which was in the past a monopoly for Zamtel," Mwanza said.
The international gateway for Zambia had remained closed since liberalization policies were introduced for other areas of the telecom sector 20 years ago. Private operators had wanted to buy their own international gateways but the Zambian government refused, citing security reasons.
MTN CEO Farhad Khan said in an interview after the announcement that once guidelines are approved, MTN will immediately start offering services for international calls and roaming.
"The biggest problem now is the high interconnectivity charges between networks of mobile operators. In other countries in the region, interconnectivity charges are lower," Khan said.
Other Southern Africa Development Community (SADC) countries are pushing Zambia and other countries where the price of international calls is high to reduce costs by cutting or scrapping termination and roaming charges in a bid to increase traffic flow.
Speaking at a SADC telecommunication operators' bilateral meeting last month, Botswana Permanent Secretary in the Ministry of Transport and Communication, Mabua Mabua, said scrapping the charges will benefit not only operators but also consumers.
Mabua said a large component of transborder call costs is mainly in the form of roaming or termination charges, which have no bearing on the actual true costs of the calls.
[The Industry Standard]
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