Millicom launches in East Africa

The battle for supremacy in the African mobile market has moved up a notch with the launch of Millicom International Cellular, a multinational telecom company, in East Africa.

The operator will compete with Zain and Mobile Telecommunication Network (MTN). Millicom, headquartered in Luxembourg, has already been operating in six African countries including Tanzania, Democratic Republic of Congo, Mauritius and Senegal under the Tigo brand name.

The company launched its services in East Africa with the establishment of operations in Rwanda earlier this month, after paying some US$67 million to the Rwanda Utility Regulatory Agency (RURA) to secure a license as the country's third national operator. The company has already invested about $52 million in network rollout covering almost the whole country so far, with base stations in 111 network sites scattered across the country.

The coming of Millicom International Cellular in the East African market is expected to spark a price war in the region, said to have the highest telecom rates in Africa. The company said its customers will be able to send short messages to other networks in the region at 50 Rwandan francs (about US$0.09) per message.

The operator already has about 153 million customers in Africa. Last year, Millicom International Cellular beat a number of telecom giants, which included pan-African mobile service provider Zain, to win the license and operate as Rwanda's third national operator after Rwandatel and Mobile Telecommunication Network.

"Tigo's investment in East Africa and its push for more investments in Africa will certainly bring positive results as competition will force service providers to be more innovative and reduce call rates," said Edith Mwale, programs officer for the African Center for ICT Development.

While other service providers in the region are struggling to get 3G licenses due to exorbitant fees demanded by regulators and the bureaucracy involved in the awarding of the licenses, Millicom has been launched with Internet and mobile services providing 2G, 3G and 3.5G services.

The Rwandan government is focusing on data, video and voice services in a bid to boost telecommunication in the country and make the country a hub of telecommunication in the region.

Although telecom competition is rife in Africa, the continent's wireless penetration is still very low. In four of the markets where Millicom operates -- Senegal, Tanzania, Ghana and now Rwanda -- only about half the population uses a mobile phone, according to Amos Manyarara, Millicom's communications officer for the Southern Africa mobile market.