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Optimism for Sierra Leone Mobile Market Blooms but Difficulties Remain

Posted by: admin on Thu, 2010-04-22 10:44

By Bai-Bai Sesay

22 April 2010

(Freetown, Sierra Leone)--Sierra Leone’s first mobile network was established in 1994 by U.K.-based Mobitel Sierra Leone Limited, which offered a radio-based telephony network and a mobile paging system throughout the country. But only recently did mobile phone use truly take off-and to such an extent that the days of landlines in Sierra Leone now appear to be waning.

One impetus for recent growth in mobile phone use was the return of thousands of refugees to the country following the long civil war. While abroad, many had been exposed to more advanced mobile handsets and networks; back in Sierra Leone, they were eager to have similar technologies at their disposal.

Emmanuel Kajue, a telephone center operator in the southern city of Bo, said mobile phones are supporting development and business activities. “Mobile phones have created job opportunities for us. Today numerous people have established businesses engaged in selling phones and accessories, and a thriving business now operates based on these modern appliances,” Kajue said.

While cell phones are clearly useful, they have been regarded by some as expensive tools that are inaccessible to the poor and marginalized (the average Sierra Leonean earns less than a dollar a day). But technology and development experts argue that market competition, among other factors, will help bring down costs. Indeed, service providers have begun to offer cheaper handsets tailored to financially constrained customers.

Five mobile phone companies currently operate in the country: Zain, Tigo, Sierratel, Africell and Comium (note that Africell recently acquired Tigo). All save Sierratel offer GSM services such as fixed wireless telephone service, internet, landlines and mobile phone networks. Prepaid cards can be purchased throughout Freetown and in some provincial towns, while the companies offer post-paid contract services to some reliable customers across the country. Two additional mobile licenses were issued in 2008 to Cellcom and Libya’s GreenN, both of which are expected to launch services shortly. According to officials at the National Telecommunications Commission (NATCOM), two other unidentified companies have acquired mobile service provider licenses since 2004, though neither has started operations.

Minister of Information and Communications Alhaji Ibrahim Ben Kargbo said the government is encouraging foreign investors in communications technologies in order to improve services and lower costs. He added that services are likely to improve dramatically once an international fiber-optic submarine cable reaches the country by 2012, reducing the cost of internet services and increasing services speed throughout the country.

Meanwhile, increasing competition in the mobile market is making calls cheaper for Sierra Leoneans. Notably, the cost of one Sim Pack has fallen steeply. When mobile communications were first introduced in Sierra Leone, a Sim Pack fetched about Le56, 000, compared to only about Le5, 000 (just over US$1) today.

However, not all is rosy in this scenario. Hon. Nuru Deen Sankoh, a member of the Parliamentary Committee on Information and Communications, said there is official concern about the rapid rise in the cost of some tariffs. He called on the national telecommunications regulator (NATCOM) to monitor the activities of the GSM operators more closely.

This has already begun to some extent. In January 2010, NATCOM Communications Director Abdul Kuyateh said that Africell and Zain were fined US$50,000 each as a penalty for simultaneously increasing their call tariffs just as the Goods and Services Tax (GST came into effect in the country. The GST is a 15 percent tax levied on companies which have turnover above two hundred million Leones (equivalent to US$50,000) annually. All companies in the country add this tax on goods and services. But commercial managers of the two mobile networks said they have taken a joint civil action in the High Court of Sierra Leone against NATCOM to challenge the fines.

The NATCOM communications director also mentioned the problem of illegal communications networks, citing the recent arrest of individuals involved in illegal operation of GSM communications using VSAT technology. They are presently making court appearances and the matter has not been concluded yet as of press time “This is why we intervene--to ensure everyone is protected from undue exploitation,” Kuyateh noted.

Mobile Money A Hit

Mobile operators have launched mobile money services in the country and they are catching on quickly. Madam Yeabu Kamara, who has a telecenter in the northern town of Makeni, said: “I am now transacting my business so easily with the introduction of the mobile money service in the country.”

Meanwhile, the GSM operators are planning to extend their networks in remote areas of the country so that rural dwellers can be part of the information age. But to do so, operators are demanding more cooperation from Sierratel; they want the company to make its satellite available for networks.

“This is why we want Sierratel to allow us to make use of satellite for our network coverage. We know that as a government communication entity, Sierratel controls and issues out gateways to all GSM companies operating in the country. This is why we are appealing to Sierratel to allow us to use our own satellite facilities in order to provide affordable and reliable network services for our numerous customers. Currently, the government gateway is not effective to all GSM operators,” said a spokesman for one of the leading mobile phone companies.

Related: Overview of Mobile Phone Use in Sierra Leone
Also read our complete Communication Profile for Sierra Leone


Photo Courtesy of Ken Banks, kiwanja.net


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