World Report

An additional 400,000 fixed lines and around 100,000 mobile connections are required

Unitel has raised its customer base from 25,000 in 2001 to more than half a million today.

he demand for telecommunications services in Angola is rising daily and far outstrips current supply despite the number of national and international players now operating in the country. It is estimated that an additional 400,000 new fixed lines and nearly 100,000 mobile connections are needed in order to keep pace with the country’s surging communications traffic. Throughout the past few years the Angolan government has granted operator licenses to private companies in both fixed telephony and mobile services. State-owned Angola Telecom still reigns in the fixed telephony market but private operators Telesel and Wezacom are intending to invest a combined total of £34.5 million by 2007 to expand their networks throughout all 18 Angolan provinces. Niche operators Mercury Telecom and Mundo Startel, who have built their businesses catering to the communication needs of Angola’s oil industry, are also now putting into place plans for expansion. Angola’s mobile market tripled in size in 2003 and was expected to reach one million subscribers by the end of 2004. The market’s two operators – Unitel and Angola Telecom subsidiary, Movicel, will soon be facing new competition as bidding for a third GSM license opened in 2004.

Meanwhile, there is a scramble amongst current operators to expand national networks and to reconstruct a telecommunications infrastructure that was severely damaged during the war. Angola Telecom has already replaced over 80% of its original cabling, but this falls short of meeting the country’s urban demand, let alone its provincial and rural telecommunication needs. The successful construction of a nationwide fixed network is certainly a top priority for the government, who estimates it will require an investment of around £270 million. Consequently, most fixed and mobile licenses that have been issued in the country have included the condition that companies will contribute to providing nationwide coverage.

Licinio Tavares Ribeiro, Minister of Post and Telecommunications

Joao Avelino Augusto Manuel, Director General of Angola Telecom

Manuel Joao Carneiro, Chairman of Mundo Telecommmunicaçoes SARL

“We have placed great importance on the establishment of the telecommunications backbone in the country because it will provide support for all the companies in the country, not just Angola Telecom,” explains Minister of Post and Telecommunications, Licinio Tavares Ribeiro. “We also believe that without an accessible nationwide network, sustainable development will just not be possible at an economic, political or social level.” For this reason, according to Mr Ribeiro, the government is intent on creating a unified network that will have different owners in different areas, but will oblige companies to interconnect lines.

At the forefront of the drive to build this network is Angola Telecom (AT). “One of the most important challenges in the country now and in the near future is the construction of a fibre optic telecommunications highway that interconnects all the provinces,” reiterates AT Director General João Avelino Augusto Manuel. “It is obviously a huge task, and one that will take years to complete. Destruction to the existing infrastructure during the war was such that we almost completely rely on satellite at the moment.” Mr Manuel says that AT is now in the process of installing the first interprovincial connection from Namibe to Huila, in the southwest of the country, and is also now replacing all its analogical stations with digital ones. Angola’s second largest operator, Unitel, is a consortium of Portugal Telecom, Mercury (a subsidiary of state-owned oil giant Sonangol), and two local companies, Vidatel and Gemini. The company launched its GSM network in April of 2001, a year before the peace treaty, and this, according to Deputy General Director Amilcar F. Safeca, was a risk that has paid off handsomely. He comments, “Starting when we did was a challenge for all the people involved in the project. Nevertheless, it was the right decision and the past three years have confirmed our prediction of a boom in Angolan telecommunications. When we entered the market there were only 25,000 mobile phone users. Today we have more than half a million.”

The company estimates that it has invested a total of £137 million to date in network infrastructure. However, Unitel now has a presence in all 18 Angolan provinces and has captured nearly 70 percent of the country’s mobile market, and Mr Safeca thinks that this is only the beginning. He says, “We think that the sector of telecommunications is in a primary stage in Angola. Therefore in the short term, it is going to develop much more. In the next three years Angola is likely to have more than two million mobile telephone users.”

The construction of a nationwide fixed network is pivotal to development

Mundo Startel SARL, which is now looking to expand beyond its traditional activities in the oil sector, offers opportunities to foreign investors. The company signed a landmark agreement with Telecom Namibia last year to construct a new network in Luanda. The agreement marked the first significant joint venture between Namibia and Angola since the end of the Angolan civil war. Manuel João Carneiro, Chairman of Mundo Telecommunicaçoes SARL, a major shareholder in Mundo Startel, says that similar partnerships for expansion into other provinces are welcome. The company plans to set up operations in Benguela next year and eventually continue on into six other provinces. He states, “We will set up interconnections with both Unitel and Angola Telecom. Our land station is only 400 metres away from Angola Telecom’s fibre optic line, so we can connect there. We will also have access via satellite through SAT3 for international communication.”