New Dawn, the first of its kind joint venture between Convergence Partners and Intelsat, is on track to launch its $250m geostationary communications satellite, which is targeted at the African market, by the end of the year, Flavien Bachabi, vice-president for Intelsat Africa said yesterday, 13 April 2010.

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Conclusion: The African communications growth story can no longer be viewed as a frontier opportunity as more and more players from developed markets enter the African market.

Rather, the market is showing signs of greater maturity reflected by, amongst other: (i) increased competition; (ii) reducing gross margins; (iii) declining ARPUs; (iv) greater complexity of product offering and mobile payment services; (v) active attempts by incumbent mobile and fixed-line operators to expand into other parts of the value chain; and (vi) the emergence of infrastructure sharing models. While subscriber growth remains superior to other regions, with significant pent-up demand remaining, these changes in the communications landscape is forcing operators to rethink their strategies and focus on the next wave of growth.

Significantly, there have been a number of major developments that will catapult the African communications market into another league from both a cost and bandwidth perspective. These include the arrival of new international submarine fibre optic cables such as Seacom connecting the East African seaboard to international submarine fibre networks and the accelerated liberalisation of African communications markets.

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SEACOM today announced that its 1,28 Terabytes per second (Tb/s), 17,000 kilometres, submarine fibre optic cable system linking south and east Africa to global networks via India and Europe has been completed and commissioned. Backhauls linking Johannesburg, Nairobi and Kampala with the coastal landing stations have been established and SEACOM is also working with its national partners to commission the final links to Kigali and Addis Ababa shortly.

The launch of SEACOM opens up unprecedented opportunities, at a fraction of the current cost, as government, business leaders and citizens can now use the network as the platform to compete globally, drive economic growth and enhance the quality of life across the continent.

Website: http://www.seacom.mu/
Blog: www.seacomblog.com
SMR: http://www.seacom.socialmediarelease.co.za/
Facebook: www.facebook.com/pages/Seacom/100372437436
YouTube: www.youtube.com/seacomlive
Twitter: SeacomLive

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Communication Solutions (Comsol) in partnership with one of its shareholders Convergence Partners is seeking to build a portfolio of wireless broadband data operations across multiple countries in Africa. A new investment company called Convergence Wireless Networks (CWN) has been formed for this purpose.

CWN will investigate opportunities to secure spectrum/licences in high economic growth areas in Africa with a view to participating in the roll-out of networks (as a strategic, minority financial investor) in those markets. “The potential for growth in wireless broadband usage across the continent is massive given the low existing base of penetration,” says Iain Stevenson, CEO of Comsol. Currently the total number of broadband connections in Africa numbers approximately less than 3 million, the majority of which are 3G connections.

Stevenson says that CWN will take up strategic equity interests in and supply value-added services across the entire wireless broadband market in Africa from equipment supply, to network installation, ongoing network maintenance, licensed spectrum acquisition, wholesale network operation and even ultimately to retail network operations. “CWN will work in conjunction with local country partners and existing players either in the technology arena or existing network operators,” says Brandon Doyle MD of Convergence Partners.

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Convergence Partners Investments, a Black Economic Empowerment investment company focusing on the Technology, Media and Telecommunications sector, announced today that it had taken a stake in Integrat, a major South African Wireless Applications Service Provider (WASP) Aggregator with related interests in digital content, online platforms and other ancillary activities.

WASPs are companies that connect to the cellular operators to provide services to the networks’ clients, usually in the form of premium-rated Short Message Services (SMS). As an Aggregator, Integrat supports its WASP customers with best-of-breed, locally developed, solutions offerings to seamlessly connect into SA’s highly regulated mobile networks in a matter of days, rather than months. Integrat’s offerings are globally competitive and have evolved over the years to include various Value Added Services, such as content manager, campaigns manager, mobile payment systems and other mobile handset-focused services. These products allow customers to deliver services within a very short time and without having to take responsibility for any development.

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SEACOM Closes Financing, Starts Full Construction of Undersea Fiber Optic Cable

Transcontinental Investment Boosts South and East African Economic and Social Development with High Capacity Link to India and Europe

African investors have taken a significant majority stake in SEACOM’s undersea broadband cable, joining hands with an international partner to link southern and east Africa with India and Europe in a massive technological boost to economic and social development on the continent.

The equity and debt facilities for the entire project costs have been unconditionally committed for the construction of the state-of-the-art cable from Mtunzini in South Africa to Mumbai in India and Marseille in France via Mozambique, Madagascar, Kenya, and Tanzania.
“This is a major milestone”, stated SEACOM President, Brian Herlihy “The construction of a new submarine fiber optic network will pave the way for a data revolution that intends to follow the explosive growth of the mobile industry in Africa. A shift from a primary voice market to a primary data market will be a catalyst to increasing worker productivity, creating better access to e-eduction and the growth of service industries such as call-centres, BPOs and research centres in Africa.
SEACOM has already invested more than $10 million in the marine survey and engineering of the cable. The advance start has enabled SEACOM to maintain its ready for service date of June 2009. Actual production of the high-tech cable and undersea repeaters start next week.”

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The funders, Nedbank Capital and Makalani Holdings Limited, have committed to contribute R125m and R75m respectively. This brings Convergence Partners’ total capitalisation value to around R600m.

The funding has been structured by way of a drawdown facility in the form of redeemable preference shares repayable in seven years. This allows Convergence Partners to invest equity into new projects and transactions but also into the refinancing of existing transaction structures. Convergence Partners will continue to leverage further on its equity injections into future transactions on a deal by deal basis.

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WiMAX is this technology (the so-called “elephant in the room”): standards have been passed, mobility will soon be enabled, and the cost of its rollout can be achieved at a fraction of the cost of the capital requirements of a 3G network. The equipment is robust and manufacturers are pressing on with chip developments for the new generation mobile devices.

So why then does LTE continue to exist? In our view the answer to this question lies in the following:

• Resistance from some existing network operators;
• Limited availability of spectrum; and
• WiMAX mobility is only starting to look possible.

Nonetheless, in this report we demonstrate that WiMAX serves as a cheap and viable solution to Africa’s wireless broadband needs, and is a serious contender that can be implemented by existing GSM operators and is in fact already being rolled out.

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The introduction of innovative pricing models has opened previously untapped markets.  This expansion is accompanied and supported by convergence, liberalisation of policy environments and rapid technology changes. The maturing of some markets has seen reduced revenue per user, but these are being offset by increased volumes, revenues and higher-end broadband offerings.

A few major international and regional players dominate the market, with significant corporate activity a strong feature.

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