Libyans spark cellphone revolution

ARTHUR SIMUCHOBA
Correspondent | Friday December 3, 2010 00:00

What seems certain however is that soon customers will be laughing all the way to the talk-time kiosks as has started happening. The stage for this happy state of affairs was set early this year when the government sold 75 percent of its stake in the Zambia Telecommunications Company (Zamtel), the country's largest but up to that point virtually insolvent telecommunications company.

The buyers were the little-known Lap Green Networks of Libya. Up to that point, Zamtel's mobile telephone operation-Cell-Z- was the smallest and arguably the tamest and shakiest of the three.

But the tables have been turned! Today, it is Cell-Z that is pretty much driving the agenda. It has the initiative and is wielding the axe over everybody else. That has touched off feverish activity among the networks. It is forcing a realignment of forces at a breathtaking pace in the hitherto largely sedate sector!

Though little known at the time of acquiring Zamtel,  Lap Green Networks are no green-horns. They are a sizeable and experienced operator with knowledge of African conditions gleaned from their  large stake in the Ugandan market and stakes in other parts of North and West Africa.

Thus, shortly after the acquisition formalities were complete, they turned their focus on increasing their share of  the mobile phones market and they hit the ground running! In short order, they announced new lower tariffs for both peak and off-peak periods and followed that up with an attractive promotion featuring free talk time credits. Dubbed the “real deal,” the promotion  credited free units with all talk-time purchases and free talk time on new Cell-Z SIM cards -  the larger the refill, the more the free units!

That immediately touched off a feverish scramble as all networks sought to keep their customers satisfied.  The other two networks - the largest Zain and MTN  soon responded.

Zain announced new reduced tariffs and their Zain to Zain tariff from 23 hours on, was the lowest 50n-in Zambia a coin-per second and that was something! Inflation made coins obsolete long ago, they went into disuse years ago! There is a whole generation that is unaware of them or what they looked like!   But now the stiff competition in the telecommunications sector is creating conditions for their second coming!   

Not to be outdone MTN who moved into Zambia shortly before they entered the Nigerian market and seemed for a while distracted by that, came up with their own largesse. They have the lowest calling rates. Now,  they  introduced free weekend calling on their network for subscribers who use so much talk time during the week.  They had already introduced lowered tariffs for subscribers calling from or to designated 'zones'.Going by the reaction, free weekend calling was something of a coup and it hit home because now competitors begun to preamble their latest offerings with: 'Why wait until the weekend?'

More and more incentives are coming on offer from all the three who have taken to big eye-catching adverts on the front page of newspapers, television and radio advertisements to draw attention to their latest offers. The front page of newspapers has in fact recently changed from what it used to be as the networks scramble for it for maximum effect. 

The pace has been frenetic and it is a measure of it that in the heat of it all, some networks even forgot the ground rules! Some of the tariff reductions were announced without being notified as stipulated to the regulatory board. It is apparently a requirement that they have to be notified to the regulator before they can be notified to the public and effected.

That was not done in this increasingly cut-throat rush to gain and defend market share and the regulator was left fuming and had to put out a public advertisement spelling out the procedure for tariff changes and warning of the consequences of not observing the provisions of the Telecommunications Act! There were some embarrassed apologies for the oversight but the tariffs were then a fait accompli and were not reversed! 

Zambia's largest network that went under the brand name Zain and Celtel before that,  was recently acquired by Bharti Airtel of India and is now known as  'Airtel' and that brand was officially launched in Zambia and around the world on November 22.

Company chairman Sunil Bharti Mittal said on the occasion that the new brand came with a promise to meet the emerging needs of customers with innovative, affordable and relevant solutions. Airtel he said had seen massive telecommunication strength in Zambia and he promised to provide low tariffs and roll out deep into un-served areas. On the same occasion, Airtel  also launched a new ultra-low cost handset package that effectively provides a mobile phone free of charge to all new subscribers.

Over the next few months Airtel promised to launch a number of world leading product innovations. They would focus on delivering relevant information to customers to enhance their quality of life and provide tools that will help them overcome daily challenges.

The competitors were obviously listening very attentively and going by the situation on the ground today, they are racking their heads for an appropriate response and may soon do so by unveiling new 'products' of their own ahead of Airtel. That is becoming the order of the day as competition stiffens. The good thing is that it is the consumer who will laugh last. The service will undoubtedly get more and more affordable as the protagonists seek to outdo each other and win more customers. It is already the case nowadays for consumers to have three handsets and use the network that offers the lowest rates at different times.           

But not just the consumer,  the country too will benefit. The Minister of Finance, Dr Situmbeko Musokotwane had something to say about  that during his 2011 budget speech.  Said he: 'the communications sector is expected to be a strong driver of (economic) growth in 2011 following the launch of third generation mobile services in the country.' Recently announced reductions in call tariffs are expected to further boost growth.”

It would appear then that a win-win situation is rapidly becoming the reality in telecommunications in Zambia.(Sila Press Agency)