<p>In a statement issued in September, the Independent Communications Authority of South Africa (Icasa) said: “The ICT sector has been and continues to undergo rapid technology changes with far reaching implications for the local and international industries.”</p>
<p>The regulator is right and some hard decisions need to be made. In May 2014, Vodacom and Neotel announced a $557-million deal for the transfer of license control from Neotel to Vodacom; public hearings were held by Icasa at the beginning of this year, revealing that not everyone is pleased.</p>
<p>The deal will be great for Vodacom, giving it the spectrum it needs, fiber infrastructure and a decent wedge of the enterprise market, where Neotel has placed its focus.</p>
<p>“The regulator has to do the right thing and take back the spectrum and allocate it to everyone. If they allow the deal to go through, then they are sending the message that they don’t want competition,” Cell C’s Chief Executive Officer, Jose Dos Santos, said.</p>
<p>The fact that Cell C uses Neotel’s infrastructure for its backhaul and the data center for billing probably provides plenty of motivation for the company to prevent the merger.</p>
<p>“One needs to be very careful because spectrum in itself doesn’t create success. Spectrum with investment is what assists you,” says Shameel Joosub, Vodacom’s Chief Executive Officer.</p>
<p>Joosub says Vodacom has the least amount of spectrum despite being the largest network.</p>
<p>The Competition Commission is the field marshal in this battlefield. It was therefore fitting that I sat down with the commissioner, Tembinkosi Bonakele, and Hardin Ratshisusu, the acting deputy commissioner and head of mergers and acquisitions, at the commission’s offices in Pretoria.</p>
<p>In making a decision on mergers, the Competition Commission investigates and analyses the impact the merger will have on competition and public interest issues.</p>
<p>“We are not here to clip wings. Mergers that will bring about innovation and efficiencies, but without reducing competition, are quite welcome,” says Ratshisusu.</p>
<p>In large mergers, such as the one proposed by Vodacom and Neotel, the commission makes a recommendation to the tribunal. The commission says it works on the current market structure and is unable to take into account the mere possibility of other mergers that may occur. It says it essentially tries to predict the future, post-merger, and what the consolidation of market share will do to price and product availability.</p>
<p>There has been a lot said about how long this process is taking. Joosub told CNBC Africa how extremely frustrating it is. He sees Neotel as an opportunity for his company to grow and the mix of mobile and fixed-line as very important for the company’s future.</p>
<p>“The question really is how long can Neotel cope without the requisite level of investment that is needed,” he adds.</p>
<p>The merger approval timeline varies based on the complexity of the issues and stakeholder engagement. There are plenty of stakeholders in the telecoms space. At the time of the interview, Ratshisusu said they were 80% of the way to a decision.</p>
<p>“If they [Competition Commission] do give the go ahead for the deal it’s going to have a list of conditions attached to it, particularly along the spectrum and wholesale,” says Richard Hurst, Senior Analyst at Ovum.</p>
<p>The commission says the market is evolving and it’s hard to say where it is going since it does not know future policies or technological advancements. It also says that it is not for them to deal with the issue of spectrum.</p>
<p>The reality is that it’s cheaper to buy spectrum than increase the number of base stations.</p>
<p>Will the Vodacom/Neotel deal benefit the man in the street? Hurst says there won’t be immediate tangible benefits to customers, but that they can expect greater quality of service. Vodacom customers were shocked to learn that the company was increasing contract prices.</p>
<p>“It’s been a tough two years for the industry in totality and obviously the whole mobile termination rate debacle didn’t help the situation,” says Joosub.</p>
<p>One of the issues the telecoms business is facing is the increase in data consumption – which requires investment in extra capacity. There are also exchange rate and inflationary pressures to deal with. Input costs are high, times are hard and everyone is working to come out on top. Vodacom is not the only one worrying about the future.</p>
<p>MTN has been under pressure at home for a while now, despite doing well in Nigeria. Last September, MTN sold its stake in the Nigeria towers business for $1.8 billion. The operator, along with Vodacom, also bought out their Nashua Mobile subscribers for $176.6 million.</p>
<p>In a cautionary announcement, Telkom said: “Shareholders are further advised that Telkom and MTN South Africa remain in discussions regarding the potential extension of their existing roaming agreement to include bilateral roaming and outsourcing of the operation of Telkom’s radio access network, which if successfully concluded may have a material effect on the price of Telkom’s securities.”</p>
<p>“A deal won’t happen unless something changes significantly,” says MTN Chief Executive Officer, Sifiso Dabengwa.</p>
<p>MTN already has a network sharing agreement with Telkom so it could be waiting to see how the Vodacom/Neotel deal shapes up. There are those that feel that the government’s decision about its Telkom stake is causing the holdup.</p>
<p>“The government will be very reluctant to let go of their shareholding in Telkom. They have plans for Telkom in terms of the national broadband plan,” says Hurst. He says it’s more likely for government to get rid of its 13.9% stake in Vodacom, although it won’t open up enough money to help failing power utility, Eskom.</p>
<p>“Telkom has embarked on a strategy to improve performance and one of the key considerations in respect of this strategy is to grow beyond its core business of connectivity by expanding into ICT services,” said Business Connexion (BCX) and Telkom in a joint announcement.</p>
<p>BCX and Telkom withdrew the application to transfer control of BCX licenses to Telkom for $211 million. The two companies say they did not need Icasa approval for the deal based on their review of the Electronic Communication Act. The Competition Commission recommended that the deal for a change in control of shareholding of BCX to Telkom be approved with conditions.</p>
<p>“Telkom, being the largest provider of wholesale leased lines to downstream customers, has the ability to foreclose its downstream rivals from access to these wholesale leased lines which are essential inputs for the provision of downstream services including managed network services (MNS), value-added network services (VANS), hosting and information technology services (ITS). The commission also found that the merger will result in the merged entity having the ability and incentives to engage in bundling strategies that may result in anticompetitive effects,” says the Competition Commission.</p>
<p>The Competition Tribunal determined Telkom&#8217;s $187.5 million offer for BCX, nine years ago, would adversely affect downstream competition.</p>
<p>“The mergers on the face of it look like they are going to reshape the entire sector, but we don’t know what that world will be like,” says Bonakele.</p>
<p>Hurst believes the ICT sector will focus on efficiency for a while to bring down costs, meaning the industry-wide restructuring we have seen will continue.</p>
<p>Vodacom’s strategy has been to invest heavily in its network, including the Nashua Mobile acquisition. Joosub says the company has spent close to $781.3 million in South Africa this year, with a further $1.3 billion earmarked for next year.</p>
<p>The South African power crisis has, according to Joosub, resulted in the company spending $6.2 million on diesel generators. He would like the industry to work together in powering through some of the issues and share input costs. He also calls for a better relationship between government and the industry.</p>
<p>Vodafone, the majority stakeholder in Vodacom, finds itself fighting a merger in Britain, with merits similar to those Cell C is bringing to the forefront in South Africa. It is not uncommon for global telecoms companies to find themselves on both sides of the fence, depending on what suits them.</p>
<p>Vodafone wants Britain’s Competition and Markets Authority to set tough conditions on the $17.2-billion BT/EE merger. EE is Britain’s biggest mobile operator, the company is owned jointly by Deutsche Telekom and Orange.</p>
<p>It’s still unclear what South Africa’s ICT picture will look like in a year’s time.</p>
<p>With a harsh operating environment impacting company performance, tight regulation and an ever growing demand for data, the Competition Commission, will have its work cut out for it. Whatever happens, there are likely to be casualties.</p>


Telecoms Battlefield

<p>Consumer services and industries are overtaking resource extraction as the most attractive investment area in Africa, a trend that is being overlooked by many global investors.</p>
<p>According to the African Development Bank (AfDB), consumer spending amounted to $680 billion in 2008 – up from $150 million in 2000 – and comprising nearly a quarter of the continent’s gross domestic product. It is set to nearly quadruple to $2.2 trillion by 2030, with sub-Saharan Africa making up the lion’s share of spending.</p>
<p>This puts the region on course to become the world’s fastest-growing consumer market over the next two decades, says UK-based research company Capital Economics. Spending will be driven by the continent’s rapid population growth, rising real incomes, increased urbanization and better access to financial services.</p>
<p>Africa’s population is currently estimated at one billion and is expected to more than double to 2.4 billion by 2050, making it bigger than India and China combined. The key question is whether the continent’s strong pace of economic growth and development can create the employment and living standards necessary to support the anticipated surge in consumer demand. So far, the omens are good.</p>
<p>The AfDB believes that Africa’s middle class – those earning between $2 and $20 a day – will climb to 1.1 billion, or 42% of the population, by 2060. That compares to 350 million, or 34%, at present.</p>
<p>“Consumerism in Africa is a really big opportunity over the medium – to long-term – there are lots of people looking to buy lots of things. Huge parts of Africa are under-represented in terms of daily items – this is underplayed to some extent,” says Simon Venables, deals leader for Africa at PricewaterhouseCoopers.</p>
<p>Nonetheless, rapid growth of investment into consumer products and industries on the continent has already begun, according to Ernst &amp; Young (EY). In 2007, extractive industries represented 8% of foreign direct investment (FDI) projects and 26% of capital invested in Africa; in 2012, it was only 2% of projects and 12% of capital – despite the booming oil and gas sectors.</p>
<p>In comparison, services accounted for 70% of projects in 2012, up from 45% in 2007, while manufacturing activities accounted for 43% of capital invested in 2012, up from 22% in 2007. In an EY survey of 500 business leaders last year, mining and metals was still perceived as the sector with the highest growth potential in Africa, but the number who believe this, dropped to 26% from 38%. In contrast, interest in African infrastructure projects is increasing rapidly, with 21% of respondents identifying this as a growth sector versus 14% in 2012 and only 4% in 2011.</p>
<p>“These changing perceptions of relative sector attractiveness in Africa reflect the changing fundamentals of many African economies,” says Mark Otty, EY’s area managing partner for Europe, the Middle East, India and Africa. This included “the diversification of sources of growth – the increasing contribution of services and the growing consumer class – and of the actual FDI flowing into these economies.”</p>
<p>Overall, Africa’s appeal as an investment destination has been growing in recent years, in step with its average annual pace of growth of 5% during the past decade. FDI flows to Africa increased by 5% to $50 billion in 2012, while global FDI fell by 18%, according to the United Nations Conference on Trade and Development. The global financial crisis placed the continent on investors’ radar screens as its economic performance outshone many other global regions.</p>
<p>Global consultancy firms such as PwC, EY and KPMG have all reported a significant increase in enquiries about Africa’s investment potential in the past year.</p>
<p>KPMG Africa chairman Yunus Suleman says that telecommunications remains a big growth area as the continent still has the lowest teledensity rate. Financial services offer another opportunity – there are four bank branches per 100,000 people on the continent compared with up to 18 in other emerging regions. Health care is attractive, as is agriculture, since the continent has 60% of the world’s unused arable land.</p>
<p>Africa’s poor infrastructure is both a challenge and an opportunity for investment – the AfDB estimates that it needs $93 billion a year, mainly in transport and power generation. This has already taken off. In 2012 there were 800 infrastructure projects worth an estimated $700 billion in Africa.</p>
<p>Nonetheless there are other big barriers to investment on the continent, with negative perceptions still globally entrenched. The EY survey showed that 86% of businesses in Africa rate the continent as the second most attractive regional destination after Asia, while those with no business presence rank Africa as the least attractive.</p>
<p>“We are seeing some realism creeping in but distant and uninformed investors with no knowledge of emerging markets will find it difficult to get the risk/reward balance right,” says Venables.</p>


More Middle Class Means Money

<p>This generation of young African women is the most ambitious yet. They are eager to build industries, reform societies, save lives, rewrite history, and transform the continent.</p>
<p>Our annual “20 Young Power African Women” list illuminates the brightest stars and Africa’s most outstanding female game changers. We enlisted a group of young, professional African women to help identify the most innovative, courageous, daring and successful young women aged 45 and under. It is a subjective list, no doubt, but it is the closest you will get to a definitive list.</p>
<p>Meet the 2013 class of 20 Young Power Women in Africa: the continent’s emerging power brokers, the Amazons to watch, and the custodians of tomorrow.</p>
<h5>Isabel Dos Santos</h5>
<h5>Angolan. Investor</h5>
<p>The daughter of Angola’s President, Jose Eduardo Dos Santos is Africa’s richest woman. She is also one of the continent’s most powerful businesswomen. Through her various holding companies, she controls a 25% stake in Angolan mobile telecom operator Unitel, a 25% stake in Angola’s Banco BIC, 25% of ZON Optimus, a listed Portuguese cable TV company, and just under 20% of Banco BPI, one of Portugal’s largest publicly traded banks. She is also partnering with Sonae, Portugal’s largest retailer, to launch 5 new food hypermarkets in Angola in 2014.</p>
<h5>Mimi Alemayehou</h5>
<h5>Ethiopian. Executive Vice</h5>
<h5>President of the Overseas Private Investment Corporation (OPIC)</h5>
<p><img decoding="async" loading="lazy" class="alignleft size-medium wp-image-5864" src="/wp-content/uploads/2017/05/IMG_7486-200x300.jpg" alt="" width="200" height="300" /></p>
<p>In 2010 U.S. President Barack Obama nominated Ethiopia-born Mimi Alemayehou as the Executive Vice President of the Overseas Private Investment Corporation (OPIC), the U.S. government’s development finance institution. She helps manage OPIC’s $16 billion war chest, channeling American capital to fund investment opportunities in emerging markets. Prior to her OPIC appointment, Alemayehou served as the United States Executive Director at the African Development Bank.</p>
<h5>Lupita Nyong’o</h5>
<h5>Kenyan. Actress and Filmmaker</h5>
<p>Nyong’o is a Kenyan actress and filmmaker who made her Hollywood debut in acclaimed film director Steve McQueen’s “12 Years a Slave” as Patsey. Nyong’o was born in Mexico, raised in Kenya and educated in the U.S. She is a graduate of Yale University’s School of Drama. In 2009, the breakout actress was also the lead in MTV’s award-winning drama series, Shuga. Nyong’o’s cousin, Isis Nyong’o was named one of Forbes 20 Youngest Power Women in Africa in 2011. Another cousin, Tavia Nyong’o, is a professor at NYU’s Tisch School of the Arts.</p>
<h5>Hadeel Ibrahim</h5>
<h5>Sudanese. Mo Ibrahim Foundation</h5>
<p>Hadeel Ibrahim is the daughter of Sudanese-born British mobile telecoms billionaire Mo Ibrahim. She is the founding Executive Director of the Mo Ibrahim Foundation, which was established in 2006 to support leadership and good governance in Africa. She also serves on the Boards of the Mary Robinson Foundation for Climate Justice and the African Governance Institute (AGI).</p>
<p>&nbsp;</p>
<h5>Minoush Abdel-Meguid</h5>
<h5>Egyptian. Private Equity Investor, Entrepreneur, Investment Banker</h5>
<p>The Egyptian-born investment banker is the cofounder of Union Capital, an Egyptian investment firm primarily focused on small and medium-sized enterprises. Abdel-Meguid is also founding president of the Egyptian Young Bankers Association, an organization that mentors young banking professionals.</p>
<h5>Monica Musonda</h5>
<h5>Zambian. Chief Executive Officer and Founder of Java Foods</h5>
<p>Musonda is the founder of Java Foods, a Zambia-based food processing company that manufactures the eeZee brand of Instant Noodles. Musonda previously worked with Africa’s richest man, Aliko Dangote, as the director of legal and corporate affairs at Dangote Group, where she led a project to build a cement plant in Zambia. She currently serves on the Boards of Dangote Industries Zambia Limited and the Central Bank of Zambia. Musonda is also the Chairperson of Kwacha Pension Trust Fund, Zambia’s largest single employer pension fund. She is an Archbishop Desmond Tutu Leadership Fellow and was named a 2013 Young Global Leader by the World Economic Forum.</p>
<h5>Lindiwe Mazibuko</h5>
<h5>South African. Politician &amp; Parliamentary Leader for Democratic Alliance (DA)</h5>
<p>Mazibuko, 33, is a Parliamentary Leader for the Democratic Alliance (MP for North Durban) and Leader of the Opposition in the National Assembly in South Africa. As the country’s fourth youngest parliamentarian, Mazibuko is already being touted as a future leader of the Democratic Alliance. Mazibuko was named South Africa’s Most Influential Woman in 2012 and a Young Global Leader by the World Economic Forum in 2013.</p>
<h5>Tara Fela-Durotoye</h5>
<h5>Nigerian. Founder, House Of Tara</h5>
<p>The Nigerian-born entrepreneur and lawyer is the founder of House Of Tara, Nigeria’s leading beauty and cosmetics company. House of Tara develops a wide range of African-themed beauty products and perfumes and also operates Nigeria’s foremost beauty academy. In 2013, Fela-Durotoye was nominated as a Young Global Leader by the World Economic Forum (WEF).</p>
<h5>Claire Akamanzi</h5>
<h5>Rwandan. Chief Operating Officer, Rwanda Development Board</h5>
<p>Akamanzi, 34, is the Chief Operating Officer of the Rwandan Development Board (RDB), a government institution tasked with accelerating economic growth and development in Rwanda by enabling private sector growth. Akamanzi has had a successful career in public service, serving as Rwanda’s commercial diplomat in London and as a trade negotiator in Geneva for the Rwandan government at the World Trade Organization. She was also previously the Deputy Director-General of the Rwanda Investment and Export Promotion Agency (RIEPA).</p>
<h5>PROSCOVIA Alengot Oromait</h5>
<h5>Ugandan. Member Of Parliament</h5>
<p>Proscovia Oromait, 20, is the youngest parliamentarian in Africa. In 2012 she was elected Member of Parliament for Usuk County, Katakwi District in Uganda. Her father, Michael Oromait, served as the MP for the same Parliamentary seat before his death in July 2012. She is a member of Uganda’s ruling National Resistance Movement party.</p>
<h5>Sibongile Sambo</h5>
<h5>South African. Chief Executive Officer and Founder of SRS Aviation</h5>
<p>Sambo is the founder and Managing Director of SRS (Sibongile Rejoice Sambo) Aviation – the first black female owned aviation company in South Africa. SRS is an integrated provider of private aviation services offering South African and international clients VIP Charter, tourist charter and helicopter services. The company also provides maintenance, sales and fleet management services to private jet owners.</p>
<h5>Vera Songwe</h5>
<h5>Cameroonian. Country Director, World Bank, Senegal</h5>
<p>Vera Songwe, a Cameroonian national, serves as the World Bank’s Country Director for Senegal, Cape Verde, Gambia, Mauritania and Guinea-Bissau. She is also a non-resident senior fellow at the Brookings Institute with the Global Economy and Development and Africa Growth Initiative.</p>
<h5>Angellah Kariuki</h5>
<h5>Tanzanian. Politician</h5>
<p>Kariuki, 37, is a Special seat Member of Tanzania’s Parliament and the country’s Deputy Minister for Justice and Constitutional Affairs.</p>
<div id="attachment_5969" style="width: 209px" class="wp-caption alignleft"><img aria-describedby="caption-attachment-5969" decoding="async" loading="lazy" class="size-medium wp-image-5969" src="/wp-content/uploads/2017/05/83362281-199x300.jpg" alt="" width="199" height="300" /><p id="caption-attachment-5969" class="wp-caption-text">Artist Wangechi Mutu attends the 2008 Whitney Museum of American Art&#8217;s gala</p></div>
<h5>Wangechi Mutu</h5>
<h5>Kenyan. Artist and Sculptor</h5>
<p>Considered one of the most important contemporary African artists of recent years, Mutu’s first major solo exhibition in the U.S., Wangechi Mutu: A Fantastic Journey, opened at the Nasher Museum of Art at Duke University in Durham, North Carolina in March 2013. Mutu’s work has achieved much global acclaim with exhibitions at museums and galleries worldwide including the San Francisco Museum of Modern Art, the Miami Art Museum, Tate Modern in London, the Studio Museum in Harlem in New York, Museum Kunstpalast in Düsseldorf, Germany the Centre Georges Pompidou in Paris. Her first solo exhibition at a major North American museum opened at the Art Gallery of Ontario in March 2010.</p>
<h5>Ola Orekunrin</h5>
<p><img decoding="async" loading="lazy" class="alignleft size-medium wp-image-5966" src="/wp-content/uploads/2017/05/1-11-300x201.jpg" alt="" width="300" height="201" /></p>
<h5>Nigerian. Medical Doctor &amp; Founder, The Flying Doctors</h5>
<p>Orekunrin, 25, is founder and Managing Director of Flying Doctors Nigeria Ltd., an air ambulance service based in Lagos, Nigeria. Orekunrin’s company is the first air ambulance service in West Africa to provide urgent helicopter, airplane ambulance and evacuation services for critically injured people. She is a 2013 New Voices Fellow at the Aspen Institute and was named a Young Global Leader in 2013 by the World Economic Forum.</p>
<p><img decoding="async" loading="lazy" class="alignleft size-medium wp-image-5972" src="/wp-content/uploads/2017/05/Shot-02-CF234984-225x300.jpg" alt="" width="225" height="300" /></p>
<h5>Rapelang Rabana</h5>
<h5>South African. Entrepreneur</h5>
<p>One of Africa’s most recognizable young entrepreneurs, Rabana, 29, is the CEO and founder of Cape Town-based Yeigo Communications, which develops software for telecoms-related services including Voice over IP, instant messaging, SMS messaging and push email services. In 2008, Telfree, a Swiss mobile telecommunications firm, acquired a 51% stake in Yeigo. In December 2012 she founded Rekindle Learning, a company that provides adaptive mobile learning solutions.</p>
<h5>Folake Folarin-Coker</h5>
<h5>Nigerian. Fashion Designer</h5>
<p>Coker is the founder of Tiffany Amber, one of Africa’s leading fashion labels. She is the first African-based designer to showcase for two consecutive seasons at New York Fashion Week. In 2009, she won Designer of the Year at African Fashion International in Johannesburg, South Africa followed by Fashion Brand of the Year in 2011 at the Arise Fashion Week in Lagos, Nigeria.</p>
<h5>Valentina da Luz Guebuza</h5>
<h5>Mozambiquan. Investor</h5>
<p>The 33 year-old daughter of Mozambique’s President Armando Guebuza heads Focus 21 Management &amp; Development, a large family-owned investment holding company with interests in banking, telecommunications, fisheries, transport, mining and property. Focus 21 owns significant stakes in Beira Grain Terminal and Chinese Pay TV Company StarTimes’ operations in Mozambique.</p>
<p><img decoding="async" loading="lazy" class="alignleft size-medium wp-image-5971" src="/wp-content/uploads/2017/05/valentina_guebuza_20120505_32-Edit-200x300.jpg" alt="" width="200" height="300" /></p>
<h5>NoViolet Bulawayo</h5>
<h5>Zimbabwean. Author</h5>
<p>Zimbabwean-born author NoViolet Bulawayo is the first Black African female and the first Zimbabwean to be shortlisted for the prestigious Man Booker prize for her debut novel “We Need New Names”. She is the author of the short story Hitting Budapest (2010), which won the 2011 Caine Prize for African Writing. NoViolet Bulawayo is currently a Stegner Fellow at Stanford University in California.</p>
<h5>Amini Kajunju</h5>
<h5>Democratic Republic of Congo. President &amp; CEO,</h5>
<h5>Africa-America Institute</h5>
<div id="attachment_5967" style="width: 226px" class="wp-caption alignleft"><img aria-describedby="caption-attachment-5967" decoding="async" loading="lazy" class="size-medium wp-image-5967" src="/wp-content/uploads/2017/05/181837445-216x300.jpg" alt="" width="216" height="300" /><p id="caption-attachment-5967" class="wp-caption-text">Amini Kajunju speaks during the Africa-America Institute 60th Anniversary Awards Gala at New York Hilton on September 25, 2013 in New York City.</p></div>
<p>A native of the Democratic Republic of Congo, Amini Kajunju is the President &amp; CEO of the Africa-America Institute, and the first African woman to serve at the helm of the oldest non-profit organization of its kind in the United States. Kajunju joined the Africa-America Institute in October 2012 from the New York-based Workshop in Business Opportunities (WIBO) where she had served as Executive Director for 10 years. Under her leadership, Kajunju has bolstered the organization’s programming and served more entrepreneurs than any other institution of a similar size in New York City.</p>
<p>&nbsp;</p>


Tag: Industries

FORBES AFRICA SOCIAL MEDIA

Telecoms Battlefield

More Middle Class Means Money

20 Young Power Women In Africa 2013