South Asia: cellcos contend with tough trading conditions but continue to record subscriber growth

According to a short note published by Telecompaper this week, the mobile market in Pakistan returned to growth mode in January, with overall subscription numbers rising to 90.703 million vs. the 89.907 recorded in December. I am not sure where these numbers come from. The WCIS databsase maintained by Informa Telecoms & Media logged a slightly different figure for December, 90.162 million, so it seems reasonable to think that estimates for January may vary as well.

WCIS did record a fall in subscriptions from November to December, although the exact numbers did not match those mentioned in a brief Global Mobile Daily report of 20th January, which noted that Pakistan's total mobile subscription base declined 0.6% at end-December to 89.9 million from 90.4 million in November, according to the telecoms regulator the PTA.

I looked around for an explanation for the contraction in market size late last year. The neatest seems to be the one outlined briefly at the Pro Pakistani telecom & IT news blog earlier this week. The reason given there for that fall in numbers is the loss of subscribers who had failed to register and verify their SIMs. SIM verification is currently quite a contentious issue, the MNOs apparently contending that a new system could compromise privileged information and "hurt the credibility of the cellphone industry."

Mobile operators in Pakistan may not sell active ready-to-go SIMs. Instead, new users purchase an inactive SIM and must then register their details. What is newer is the requirement for operators to furnish the National Database and Registration Authority (NADRA) with their subscribers' mobile phone numbers before the activation of SIMs. The operators reportedly had no objection to providing other data about their customers, e.g. parents' names, address, place of birth etc. This newer requirement, however, has not gone down well with the MNOs, whose leaders are reported to have said that the new clause clashes with their contracts with the PTA, which had allowed them to keep their clients' information secret.

When the Dawn newspaper contacted senior executives of Mobilink, Telenor, Warid Telecom, Zong and Ufone, the responses were strongly worded. "Why does NADRA need our customers' numbers? It's ridiculous. This information is privileged and is only to be provided to the government...if there is a (credible) national security concern as mentioned in the terms and conditions of our licences," said a Mobilink executive. "How will this information be used? It is equally detrimental for companies and subscribers," said another top executive, adding that the new clause might jeopardise the entire mobile industry.

"This was not part of the agreement when we paid Rs291 million licence fees," said a Zong executive. "Licence terms cannot be changed just like that. We are providing [a] public service. We hired more than 300 people, trained them, set up new call centres and brought in expensive new equipment just to make the SIM verification system a success," he said.

From Telenor Pakistan, Dawn's reporter learned that both the PTA and NADRA came down hard on the cellcos, leaving them with no choice but to sign the new agreement. "We were told that this agreement was not negotiable. Without signing it, we will not be allowed to sell SIMs. It's a question of compromising an industry that generates Rs2 billion annually," said a source within the Norwegian-owned MNO

"Unjustifiably, NADRA had earlier raised the verification fee by almost 200 per cent," said a representative for Warid Telecom.

After all this fuss in January, the operators appear to have been working quite hard to win back lost custom. Reduced rates have been a quick remedy.

Naeem Pani Wala, a Pro Pakistani contributor, wrote last month about the resulting 'Paisa war', taking note of Zong's especially aggressive undercutting of market-leading Mobilink. "Despite the fact that current economic situation doesn’t allow low pricing," writes Naeem, "we know that this doesn’t matter much for [the] Chinese and they beat the competition with low rates."

Naeem analyses the various TV advertisements run by Pakistan's MNOs. His view seems to be that, being unable to compete with Zong purely on price, Mobilink has decided to focus on coverage and quality of service, as in this ad:



Naeem feels this is a good approach, enabling Mobilink to remain highly visible to consumers "without investing much on packages." According to Naaem's article, Telenor Pakistan seems to be staying out of the hottest price war action and focussing its efforts on dominating the high value post paid space, as explified by this advertisement:

Over time, I assume we will see figures indicating that while Pakistan's cellcos have managed to get back onto the subscriber growth path, the price war reported by Naeem is affecting earnings.

A South Asian market where there already seems to be confirmation of this is Sri Lanka. Cellular News reported earlier this week that market-leading Dialog Telekom has suffered a sharp drop in prepaid ARPU, which fell by 22.6% from Q4 2007 to Q4 2008. "Sri Lankan consumers may have been unpeturbed by local or global economic circumstances in 2008", says the Cellular News artcle, "but Dialog was not. Despite the strong customer growth, annual revenues grew by just 1.0% to SLR 33,108m. A 48.4% rise in costs saw gross profit down 26.0% to SLR 15,478m, while EBITDA fell 41.6% to SLR 8,370m. Fourth-quarter EBITDA was even worse hit, a massive 75.6% decline taking the figure to SLR 740m from SLR 3,027m in Q4 07. This was partly due to exceptional items, but even on a normalised basis there was a fall of 51.6% to SLR 1,466m."

While subscriber growth looks good in principle, it does seem that South Asian markets are at the stage where operators have realised that extending the availability of services to ever less affluent population segments will mean higher costs and steadily declinding ARPU. Let's see how many of the region's operator suffer significant hits to EBITDA as a result.

South Asia: cellcos contend with tough trading conditions but continue to record subscriber growth

India: Aircel invests in expanded coverage; TRAI/DoT wrangles to hamper new MVNOS?

My most recent post here was a discussion about the prospects for MVNOs gaining traction in emerging markets. Specifically, I rounded up views about which of India or Africa (taken as a whole) would be first to see truly mass-market MVNOs.

Anyone betting on India may be disappointed to hear about potentially quite unhelpful disagreements between the country's telecoms regulator and Department of Telecommunications. One of these is a difference of views about the question of whether prospective MVNOs should be allowed to be hosted by more than one MNO in a given area. According to an Economic Times (India) article today, the TRAI position is that each MVNO should stick to a single network. The DoT has decided otherwise.

This, and other bones of contention, may delay the market entry of MVNOs. As the Economic Times article notes, while the Indian Government has already cleared the entry of MVNOs, it has not issued policy guidelines because of the DoT and the TRAI failing to arrive at a consensus on several important points.

The TRAI justification for wanting to restrict MVNOs to single operator tie-ups is built on a stated concern about further complicating mobile number portability. A DoT communication to the TRAI also stated that calculation of spectrum charges would also become difficult if virtual operators tied up with multiple MNOs "as each service provider has a different slab for calculating these levies (based on the number of customers they have)." The regulatory body, states the Economic Times article, has also expressed concerns about monitoring and and maintaining service records if MVNOs are allowed to tie up with multiple operators.

The TRAI has also taken issue with the DoT suggestion that each mobile operator should be allowed to share their networks with no more than two MNVOs. The article indicates that the feeling at the TRAI is that this would not work to attract a good number of MVNOs onto the Indian market.

When (and whether) MVNOs make a significant impact in India remains to be seen, then. One Indian cellco, however, is working hard to ensure that its own impact on the market is greatly increased.

­A Cellular News story today reports that Aircel, in which Maxis Communications of Malaysia holds a 74% stake, has announced plans to double its subscriber base and invest USD 5 billion in its network over the next three to five years.

Aircel is not currently among the giants of the Indian cellular area. According to the World Cellular Information Service, the company had just under a 5% share of the country's mobile subscriptions by the end of 2008. Thus far, Aircel has not extended its reach to all 23 of India's circles (regional markets). The Cellular News piece quotes the company's COO Gurdeep Singh as saying that following recent expansion of Aircel's coverage "by April-end, we will launch our services in rest of Maharashtra, taking the total number of circles to 18." Singh added that "Hyderabad is the 13th circle where we have launched our services and with this we have completed our southern footprint."

India: Aircel invests in expanded coverage; TRAI/DoT wrangles to hamper new MVNOS?

Africa or India: Which will be first to see mass-market MVNOs?

I was pleased to see confirmation that those to whom I handed over the task of organising this year's annual Eurasia Com conference in Istanbul have found a speaking slot for Cristobal Alonso, Chief Commercial Officer at mmChannel, a technology company dedicated to the development and management of digital entertainment services and platforms on a B2B format.

Cristobal and I have been in contact since mid-2007 without ever having the opportunity to meet face-to-face. This is a shame for me given how much he has to share about boosting the take-up of mobile value-added services. You can get some sense of Cristobal's ideas by having a look at his blog, where I noticed that he and I have something in common - we have both recently had the pleasure of attending a Mobile Monday Istanbul meeting. In January, I gained from the wonderful networking opportunity which Mobile Monday events provide and made a short presentation on the theme of mobile social networking. Cristobal was at the February get-together, and on his blog he reports on that meeting's MVNO-themed discussions. I imagine that was a lively session, given that the mooted market entry of MVNOs in Turkey has been something of a hot topic for a while now. Cristobal is quite right to compliment the MoMo Istanbul organiser Natali Yeşilbahar for the great job she has done to boost attendance and further improve the usefulness of the discussion sessions.

I guess Cristobal maintains a keen interest in whether MVNOs will succeed in emerging markets, given that his blog also mentions the insightful materials on this theme recently prepared by his colleague Carlos Valdecantos. Carlos asks whether there is any realistic prospect for successful MVNOs in Africa, where "most markets are experiencing pent-up demand, customer segmentation has only started to be a buzz word, and capacity is scarce." As Carlos notes, this is a markedly different scenario from that seen in the mature markets where MVNOs have sought to exploit the challenges faced by their host network operators, namely "slowing subscriber growth, lack of consumer segmentation, and excess network capacity."

As well as discussing which MVNO business models might work in an African context, Carlos segments the continent's many markets according to the likelihood of their being able to bear the entry of MVNOs. Carlos believes the high potential markets (good market size/GDP, strong economic liberlisation and a "dynamic" telecoms sector) are Morocco, Algeria, Tunisia, Egypt, Ghana and South Africa:

Assuming the onset of the global economic crisis has not caused him to revise his view, I assume that Peter Boyd, the former CEO of Virgin Mobile South Africa, would agree with this assertion. Back in July 2008, Boyd was quoted in a Middle East and Africa Wireless Analyst article as saying that "if there is one place where consumers need choice, it's Africa." Boyd argued that "you don't need multiple network licenses – that's an inefficient allocation of resources. Having an environment that lets people plug in an MVNO is a much more efficient way to serve consumers."

My former Informa Telecoms & Media colleague Matthew Reed wrote the article, noting that "even in South Africa, MVNOs are technically illegal. The only way for Virgin to introduce one was by forming a joint venture with Cell C, which holds a license to operate." If this and other barriers to MVNO market entry could be overcome, Boyd felt that the MVNO model enables the host network to sell its spare capacity, giving it new income to recoup expenses or invest in extending its coverage. This sounds quite compelling when applied to markets in which MNOs and governments jointly have the aim of extending the availability of services to less affluent prospective subscribers in the under-connected hinterland.

Matt's article noted that Virgin Mobile, then lobbying the Independent Communications Authority of South Africa for reduced interconnection fees, had acquired very few subscribers compared to the more than 40 million subscriptions shared by South Africa's three MNOs. Matt noted that while Virgin Moblile was lagging far behind the MNOs in this regard, "one figure where [it] is ahead of its rivals is ARPU, as a result of targeting higher-spending users rather than the mass market."

Has this situation improved for Virgin Mobile South Africa? It seem the answer is a pretty clear 'no'. Now led by new CEO Steve Bailey, the company has yet to have had a significant impact on the market, according to a more recent MEAWA article. Writing last month, Dario Talmesio notes that although the MVNO still has the highest ARPU in the market, "it had signed up just 600,000 subs by end-2008, and only 200,000 of them were active – giving it a market share of just 0.4%."

Talmesio reminds us that before launch, Virgin Mobile South Africa had hoped to acquire 10% of South Africa's mobile market within five years and asserts that target is now unrealistic. Talmesio feels that the company is unable to differentiate its services other than by using its distinctive branding. 3G services are not an option, notes Talmesio, because host operator Cell C, has not deployed a W-CDMA network. Of the three cellular network operators competing in South Africa, Cell C is alone in not having a 3G offering. Rivals Vodacom (50.98% market share according to WCIS) and MTN (35.55% share) began to sign up 3G subscribers in December 2004 and June 2005 respectively.

Virgin Mobile is also prevented from lowering its prices, Talmesio writes, because of the high interconnection rates it continues to pay. Talmesio also states that the MVNO has a more limited handset portfolio than its rivals.

In contrast to Virgin Mobile's highest ranking ARPU, host network Cell C had the lowest ARPU in the country in 2008, according to Informa Telecoms & Media. Talmesio writes that "from Cell C's perspective, hosting MVNOs makes sense when they can complement Cell C's market position and reach a different segment of the country's customers."

Talmesio seems to feel that Virgin Mobile South Africa has just one unique selling point: "the simplicity of its semiflat tariff" with "VMSA customers pay[ing] a premium rate in return for getting a simplified tariff".

Talmesio also argues that lateness to market may have worked against Virgin Mobile in South Africa, noting that "mobile penetration was already 72% when VMSA launched" and that "by contrast, the UK's penetration was just 40% when Virgin launched [there]". Therefore, he writes, "VMSA had to try to lure users away from incumbents rather than focus on greenfield users, as Virgin Mobile UK did in the late 90s."

If this last point is one of the most important inhibitors to strong growth for Virgin Mobile South Africa, this might suggest that, favourable regulatory regimes permitting, less highly penetrated markets in Africa might prove more fruitful for future MVNOs. Of the countries coloured green on the map above, perhaps Ghana looks the best bet, then. I also wonder whether Nigeria might be a viable environment for new MVNOs.

Whether MVNOs do succeed in Africa, or in other emerging markets, remains to be seen. Writing for Billing World in September, Patrick McGrory of customer care and billing giant Amdocs felt that "new services — Internet access, VoIP, WiMAX — and evolving business models like MVNOs enable cheaper and faster deployment in areas that previously were not viable prospects".

Two companies seemingly not about to launch MVNOs in an emerging market are Ericsson and Nokia. A Total Telecom report last Friday rubbishes recent rumours that the Scandinavian firms were planning to offer MVNO services in India.

"The speculation is completely incorrect – it's pure nonsense," an Ericsson spokeswoman told Total Telecom.

"Nokia is not planning on offering MVNO services in India," commented a Nokia Siemens Networks spokesman, who added "we provided input and advice to the Telecoms Regulatory Authority of India to help educate them with our experience of providing services to MVNOs, and that was it."

The denials of these two companies notwithstanding, some analysts feel that the Indian market is ripe for exploitation by MVNOs. The Total Telecom article quotes a research note from Ovum which states that "being able to enter a huge market with a population of 1.2 billion people when the mobile penetration rate is extremely low at around 26% is certainly a dream prospect for MVNOs, and many will find it hard to resist." My former Informa Telecoms & Media colleague James Moore is quoted as saying "the MVNO model will be an opportunity for GSM operators without a 3G license to offer WCDMA services."

If Africa continues to be a hostile environment for prospective MVNOs, perhaps it will be India which proves to be the first emerging or middle income market in which virtual wireless operators gain traction and become a large scale phenomenon.

Africa or India: Which will be first to see mass-market MVNOs?

Adventures in telecoms socialism

In January, writing an article for the Com World Series blog, I discussed the links apparently being formed across Latin America by state-owned telecoms operators from countries with left-of-centre governments. The starting point was the news that Venezuelan incumbent telco CANTV was considering a strategic partnership with Ecuador's beleagured CDMA MNO Alegro PCS. I mentioned my own enjoyable trip to Caracas in April 2008, during which I had the opportunity to visit CANTV HQ. The operator had been renationalised by President Hugo Chávez in 2007. The external affairs representative whom I met was keen to tell me about how the organisation was looking to develop partnerships with telcos in politically sympathetic states such as Cuba and Nicaragua.

At that point, I was only aware of Latin America as an arena in which state-owned telecoms service providers from countries with left-leaning governments might look specifically to markets run by political fellow travellers for new opportunities.

Last month, however, I learned from a brief Global Mobile Daily report that Vietnamese operator Viettel, owned by the nation's military, has selected Huawei and Ericsson to provide equipment for expanding its networks overseas into North Korea, Cuba, and Venezuela. The report notes that the operator has yet to enter any of these markets, and states that, according to Viettel Deputy Director Tran Phuoc Minh, discussions are planned with telecoms authorities in each country.

This is just the latest move in an international expansion strategy with which Viettel has already made progress. Last month, Viettel's subsidiary in Cambodia, using the Metfone brand, officially launched mobile services. The unit is said to have over 1000 base stations supported by a 5000km fibre-optic network linking all provinces in Cambodia. The new operation reportedly attracted 500,000 subscribers in its first three months of trial services. A Saigon Times article on the operator's foray into neighbouring Cambodia indicates that the new cellco will target low-income subscribers with a wide range of low-priced services and packages. Viettel Deputy General Director Nguyen Manh Hung is quoted as saying that this approach is not only about customer acquisition but is also intended to "contribute to society".

Viettel, the article states, also announced the provision of free Internet services for nearly 1000 Cambodian schools within the next five years. Rural rollout seems to be high on the Metfone agenda, with the operating planning to "extend its coverage to Cambodia’s remote villages and islands."

Meanwhile in Venezuela, CANTV's mobile arm Movilnet is set to launch a low-cost mobile phone on the local market. A Telecompaper report this Thursday states that the device, dubbed 'El Vergatario' is the first mobile handset produced in the country. According to Movilnet President Jacqueline Faria the device will be the cheapest available in Venezuela. To be launched for Mother's Day in May, the CDMA phone will be available for VEF 30 (USD 13.95). El Vergatario will be produced at the Venezuelan Telecommunications Factory (Vetelca), a joint stock company, in which the Venezuelan state holds an 85% stake, with the remaining 15% owned by ZTE. The article suggests that Vetelca hopes to sell around 600,000 Vergatarios this year.

Movilnet's subscribers seem to be a remarkably loyal bunch and the country's mobile market overall is one in which the three competitors' share of the subscriber base has remained largely unchanged for some time. Movilnet's competitors have not remained complacent. Movistar Venezuela has been steadily migrating customers from a legacy CDMA to a newer GSM network since March 2007 and has more recently launched W-CDMA services. Digitel, owned by Venezuelan businessman Oswaldo Cisneros, is also working to roll out 3G services in two stages, starting this month, according to local news portal Ciberespacio. The operator currently offers Huawei USB modems and by mid-2009 will integrate voice and data services.

OK, comrades. That's all I have on telecom-socialism for now.

Adventures in telecoms socialism

The mobile phone: the tool of freedom fighter and terrorist alike

These are turbulent times for some mobile operators in South Asia. Earlier this week, India's oldest communications service provider, state-owned BSNL, had to shut down all of its mobile network base stations along a 500 km stretch of the border with Nepal. According to an Economic Times article, this was due to security concerns. "All the BTS towers of BSNL mobile established in all Nepal bordering districts including Basti, Balrampur, Bahraich, Gorakhpur, Shrawasti, Siddharthnagar and Maharajganj have been jammed," a Government source said on condition of anonymity." By taking this step we have tried to chop off a helping hand of those involved in anti-India activities on Indo-Nepal border," the official added.

This comes very soon after the mobile operators of Bangladesh lost revenues during the recent mutiny by members of the Bangladesh Rifles regiment. In a Daily Telegraph report, I read about the Bangladesh Telecommunication Regulatory Commission asking the country's cellcos to cut off services.

Further east, the tiny minority of Burmese citizens with access to mobile services had services suspended in during the 2007 protests led by Buddhist monks.

Even for those of us lucky enough to live in quite stable countries, it is easy to imagine how mobile devices could be used to accelerate the spread of dissent during times of unrest. The Burmese Government certainly takes no chances. Services are provided by a lone operator - the state-owned Myanmar P&T - to just 0.59% of the population (by December 2008), according to the World Cellular Information Service. It will not surprise many readers to see the close correlation between very low mobile penetration and a country ranking right at the bottom of the world press freedom index compiled by Reporters Without Borders. Burma is ranked 170 out of 173. Other countries in the bottom five are Cuba (2.93% mobile penetration), North Korea (0.02%) and Eritrea (2.13%).

More encouraging is the 19.51% mobile penetration rate of Turkmenistan. The Central Asian, former Soviet Republic was until recently notable for a long list of peculiar restrictions placed on its citizens. Former President Saparmurat Niyazov enforced a ban on satellite dishes, beards, long hair, ballet, opera and recorded music. These restrictions are now being gradually relaxed by the new President Gurbanguly Berdimuhamedow, who came to power after the death of his predecessor in December 2006. Although Turkmenistan continues to attract criticism as a repressive one-party state, the relatively more open society since the passing of the country's first President seems to correlate with the steady increase in the take up of mobile services. Penetration was just 4.40% around the time the Türkmenbaşy died in office. A year later this figure had doubled, growing faster still during 2008.

I am sure many applaud the mobile phone and Internet access as being useful tools for anyone seeking to weaken the grip of a repressive regime. These sames technologies, however, are equally useful to those keen to change the world in ways which do not meet with approval of the western media - hence the network suspensions in Bangladesh and on the India-Nepal border.

The mobile phone: the tool of freedom fighter and terrorist alike

A mixed week for telcos in the UK press

Non-British readers will probably only associate the city of Liverpool with the Beatles and the city's red-shirted, iconic football (translation for US readers: soccer) team. Apologies to the blue half of Liverpool for reminding you that your local rivals are much more famous. You knew that anyway. It wasn't a jibe - I can't very well make sarcastic remarks about the profile of football clubs given that I am a dyed-in-wool QPR supporter.

Liverpool sometime attracts attention for more controversial reasons. British readers may recall the colourful then-Member of Parliament (now London mayor) Boris Johnson raising the ire of Liverpudlians for making some pretty strong allegations about the character of the city's residents. In October 2004, Johnson wrote that people in Liverpool "cannot accept that they might have made any contribution to their misfortunes, but seek rather to blame someone else for it, thereby deepening their sense of shared tribal grievance about the rest of society". He said Liverpudlians "wallow" in their "victim status", adding that this is part of the "deeply unattractive psyche" of many in the city. I am sure this is untrue, and Boris did get quite a telling off from his boss. With these thoughts in mind, however, I did smile on seeing seeing the following:

"Phone giant BT charged a Huyton pensioner £100 for call out to replace two AA batteries", moaned a Liverpool Echo headline on Saturday. The accompanying article alleges that an elderly, cash-strapped and bed-bound BT customer was, without fair warning, charged £100 to have an engineer visit his home and pop a couple of new batteries into his phone. The article quotes a BT spokeswoman as saying that the customer had been advised the fault was in the phone, adding "we are satisfied from our customer service records the customer was properly advised about the possible charges ahead of the engineer's visit." If you can be bothered to watch the video clip below, you will notice the 'victim's' daughter admitting that she'd been advised to check the phone and expect a call out charge:

The Liverpool Echo doesn't let this get in the way of a good opportunity to stir local opinion about our national incumbent operator. This does make me wonder how much this paper might have contributed to the the city attracting the kind of criticism levelled by Boris Johnson.

I appreciate that a modern, competitive telco needs to be customer-centric, but I also feel that operators cannot very well cater to the whims of everyone with an unreasonable demand and a misplaced sense of injustice.

With this in mind, I was pleased to see our industry getting some praise in a UK newspaper this week. The Guardian ran a very upbeat article about how the mobile phone is helping to lift people in developing countries out of extreme poverty. It's a good read and filled with heart-warming anecdotes. This is my favourite:

"For much of his life, Mukeba didn't have an address. His corrugated iron house had no number and his volcanic ash street in the heart of Goma had no name. There was no postal service and the phone system had long since disintegrated. So when his mother died in 1995 on the other side of the Democratic Republic of Congo, her church sent a note marked only "Deograsias Mukeba, Goma". Remarkably it got to him - but three weeks after the funeral.

That was before. Now Mukeba's address goes with him everywhere. It has transformed the 33-year-old's life. It is an old Nokia mobile phone. "It was very hard discovering my mother had died and been buried and I didn't know anything about it for weeks," said Mukeba. "But that's how life was. If you lived in Goma, Kinshasa was another planet.

"I didn't really have any work. When the cell phones came I found the money and bought one because it was cool to have. It cost me $25 (£18). It's a lot.

"My brother lives in Kinshasa where he is a trader. He called me and asked me to start finding some things for him that you couldn't get in Kinshasa but you could find in Rwanda and Uganda, like some electrics and car parts. Now I speak to him every day. I send a lot of stuff. Now we are making money."

One customer in Western Europe whines about the telephone company. Another in the Democratic Republic of Congo cannot speak warmly enough about his mobile service. Our industry can frustrate and delight in equal measure. I guess it depends on your sense of perspective.

A mixed week for telcos in the UK press

CDMA alive and well in Nigeria?

ZTE last week announced that its CDMA EV-DO Rev. B solution will be available for commercial deployment in Q3 this year. Kevin Fitchard of Telephony magazine reports that the Chinese vendor claims to have demonstrated the viability of dedicating an entire CDMA network to 3G while still supporting both voice and data. ZTE talks up the advantages of having circuit-switched voice capacity replaced with VoIP, claiming that Rev. B will have both the capacity and low latency to support high volumes of VoIP traffic.

However, as Fitchard notes, CDMA operators are not rushing forward in great numbers to deploy Rev. B, with many of the major players having already committed to deploying LTE networks. Notable, of course, is US giant Verizon Wireless, whose LTE plans are at an advanced stage. Fitchard argues that LTE will not only give CDMA operators the same wide channels as Rev. B, but it is also a more spectrum efficient technology, going on to predict that CDMA operators are likely to bypass Rev. B entirely and focus their broadband strategies on LTE.

None of this is to suggest that the CDMA networks themselves are set to become a thing of the past any time soon. OK, in a recent post here I noted that India's Tata Teleservices (as has been the case with its rival Reliance Communications) is looking to migrate customers from a legacy CDMA to a newer GSM network. I also mentioned the case of major Brazilian cellco Vivo being further down that same migration path. However, I have also written here about new entrant Sistema Shyam Teleservices wanting to acquire other CDMA operators in order to gain better access to the Indian market. In the same article, I noted that the COAI, the Indian GSM operators' trade association, has been protesting about the possibility of being outpaced by CDMA operators in the race to deploy 3G services.

In India at least, there appears to be life in the CDMA camp. Another market where the same can be said would appear to be Nigeria. Some CDMA operators there certainly claim to be in rude health, not least Visafone, a unified service licence holder which had launched commercial services in over forty cities across twelve states, including in the capital Abuja, by early 2008. According to a year-old Global Mobile Daily report, the operator gained its license following its acquisition of CDMA operator Cellcom in June 2007, going on to grow by purchasing further CDMA players Independent Telephone Network and Bourdex Communications in November 2007 and January 2008 respectively. These acquisitions gave Visafone a subscription base of around 100,000. According to an article that I stumbled upon today, the unified service licence held by the company, which was founded by Zenith Bank International CEO Jim Ovia, allows the provision of both mobile fixed telecoms services. This followed the 2006 expiry of a five-year mobile market exlusivity arrangement enjoyed collectively by the country's GSM MNOs.

By July 2008, my former Informa Telecoms & Media colleague Matthew Reed, editor of Middle East and Africa Wireless Analyst, was writing about Nigeria's CDMA operators experiencing "strong growth". Matt noted that the unified licensing system had liberated the CDMA players by enabling them to offer nationwide services, and pointed out that Starcomms, then (and still) the country's biggest CDMA, operator had seen its subscription count grow 125.5% in the twelve month period up to March 2008. Matt also observed that Multilinks, which is controlled by Telkom, South Africa's incumbent wireline operator, had, over the same period, enjoyed at 49.2% rise in its subscription count. Other numbers reported by Matt last summer: Reliance Telecom had recorded growth of 54.84% in the 12 months to end-March, to 430,000 subscriptions, and Intercellular and Visafone had both seen their subs counts more than double over the same period.

Despite these strong growth rates then, as now, the big three GSM MNOs remained much larger players. That notwithstanding, Visafone CEO Thomas Ninan was keen to direct some highly critical comments towards his GSM rivals when profiled by Nigeria's Technology Times in November. Ninan alleged that Nigerian GSM subscribers suffer QoS issues because the operators "commit an inadequate portion of the revenue they yield from the nation’s mobile telephony market on network expansion." According to Ninan, states the article, "in a bid to gain maximum return on their investments, GSM operators only spend a relatively marginal part of their revenue to network expansion, a development that has seen subscribers... suffer... network congestion."

Ninan was quoted as saying that Visafone was "exploiting opportunities created by GSM operators that are short-changing their customers". This particular comment was made in Mauritius, where Ninan was attending the 3rd Global CDMA Operation and Development Forum, hosted by Huawei, Qualcomm and the CDMA Development Group. In that setting, I imagine that Ninan may well have got a fairly sympathetic reception for his strong words.

Ninan feels that the leading GSM players, MTN Nigeria, Zain Nigeria and Globacom have set their tariffs "very high", which opens "more space for price competition."

To some degree, it now seems that the Nigerian Communications Commission concurs with Mr Ninan's view that mobile subscribers in the country could be served better. Last month, Technology Times reported that the NCC has found it necessary to inaugurate a 12-man Industry Consumer Advisory Forum to protect the rights of consumers of telecoms services. Organisations represented on this advisory boady include the Nigerian Society of Engineers, the National Disabled Empowerment Forum, and the Consumer Awareness Organzation. The Association of Telecommunications Companies of Nigeria (ATCON) is also represented, presumably in the interests of balance.

In terms of securing better deals for customers, one area of concern, according to Muhammed Rudman, Managing Director of Nigerian Internet Exchange Point (NIXP), is the high price paid by end users of Internet services. NIXP is a neutral, not-for-profit Internet exchange committed to enhancing the exchange of traffic between networks through co-operative peering agreements. According to another Technology Times report last month, Rudman has urged the Government to mandate all service providers to connect to the nation’s exchange points, adding that a Government-mandated connection rule "is a last-ditch recommendation following the apathy shown by service providers". Rudman feels that all service providers connecting to the nation’s exchange points is a vital component of achieving "technical and economic gains for the Internet community in Nigeria."

In the mobile space, Visafone's Ninan has not been the only highly vocal booster for CDMA technology. Ninan's counterpart at Starcomms is the Lebanese-American Maher Quabain, who, in a March 2008 interview with ITNewsAfrica.com, insisted that CDMA "consistently provides better capacity for voice and data communications than other commercial mobile technologies, allowing more subscribers to connect at any given time."

Perhaps the most bullish words on the subject of the Nigerian CDMA operators' prospects come from Reliance Telecom, whose Executive Vice Chairman Ken Aigbinode, speaking last summer, set his company the target of having acquired 10 million subscribers by 2011. This does, perhaps, look ambitious. The company's subscription numbers surged from 415,000 to 752,000 in the period Dec 2007-Dec 2008, according to Informa's World Cellular Information Service. For me, 10 million still looks like a quite distant milestone. That said, there is room for growth in the Nigerian market. Mobile penetration stands around 40%, and the country currently has a population of around 148 million. However, with no fewer than eleven mobile operators currently competing, and with the GSM players still a long way ahead, I do wonder how far the CDMA MNOs can grow. Of the GSM group, the newest, Etisalat Nigeria, is presumably well-funded, given the deep pockets of its majority shareholder from the UAE.

There are not many markets worldwide still hosting a GSM-CDMA struggle. Nigeria's looks by some measure the most interesting.

CDMA alive and well in Nigeria?