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Issue 456

Volume 10
13 January 2011

Blycroft Ltd Contents:


PO Box 2 A & ME SUBSCRIBER STATISTICS:
Craven Arms Middle East Mobile Penetration: 2Q 2010
SY7 9WL AFRICA & MIDDLE EAST:
United Kingdom
FT continues emerging markets watch
T: +44-870-241-4505 AFRICA:
F: +44-870-130-6550 M-PESA on track for DRC and Mozambique launches
ALGERIA:
editor@blycroft.com OTA advisors named
ANGOLA:
Website More districts now covered by Unitel
GHANA:
Twitter Vodafone hands network management to Huawei
ISRAEL:
Contents
February tender starts to attract bidders
Log-in JORDAN:
Handset availability checking 3G growth says Orange
Directory of Mobile KENYA:
Network Operators SMS rates savaged by Safaricom
KUWAIT:
Country Report VIVA promotes CTO to CEO
MALAWI:
About Court backs MACRA interconnect regime
New CEO for MTL
Contact MOROCCO:
Dakhla selected as inwi testbed
Subscribe
MOZAMBIQUE:
Movitel outlines first year investment plans
Copyright
NIGER:
Mobile operators to fund public sector pay rise
NIGERIA:
Published in the UK a minimum of Glo launches 4G network
48-times a year and available in
electronic format (PDF) and a Next bidder for NITEL please step forward
Web-based Searchable Archive. QATAR:
Vodafone adds 1,200 new subscribers daily
No part of this journal may be
copied, photocopied or duplicated RWANDA:
without prior written permission of Micro-SIMs for Tigo subscribers
the publisher.
SAUDI ARABIA:
c. 2011 Blycroft Limited Huawei to overhaul Bravo operations
Zain looks to FRiENDi for new offering
SOUTH AFRICA:
New Cell C network meets national and local targets
PPT deal for NECO
Spectrum sale speeds-up
SWAZILAND:
Dropped calls a challenge for MTN says CAS
TANZANIA:
Top-up cash requested by TTCL
UGANDA:
UTL creates interconnect irritation for rivals
UNITED ARAB EMIRATES:
Court issues notice to Etisalat Indian unit
du strengthens northern footprint

Country Report

Paul Budde Country Report: Kenya - Key Statistics, Regulatory & Fixed-Line Telecoms Overviews
A & ME SUBSCRIBER STATISTICS:

Middle East Mobile Penetration: 2Q 2010

Middle East States Ranked by Mobile Penetration 2Q 2006 - 2Q 2010

Source: industry sources, Blycroft estimates c. Blycroft 2011

Middle East Mobile Penetration by Rank: 2Q 2010

State 2Q06 2Q07 2Q08 2Q09 2Q10

Qatar 100% 134% 177% 232% 320%

UAE 107% 141% 197% 212% 236%

Bahrain 112% 127% 174% 197% 217%

Kuwait 97% 105% 113% 132% 151%

Saudi Arabia 71% 100% 110% 128% 142%

Israel 134% 137% 133% 129% 127%

Oman 50% 67% 87% 102% 115%

Jordan 62% 77% 80% 90% 101%

Iran 13% 24% 60% 79% 93%

Palestine 30% 38% 49% 68% 92%

Turkey 65% 76% 84% 83% 79%

Iraq 26% 36% 49% 66% 76%

Lebanon 27% 29% 32% 50% 63%

Afghanistan 5% 12% 22% 34% 48%


Syria 20% 29% 37% 41% 48%

Yemen 12% 17% 24% 31% 36%

• • • • • •

Totals 40% 52% 69% 79% 87%

Source: industry sources, Blycroft estimates c. Blycroft 2011

Middle East Mobile Penetration by State: 2Q 2010

State 2Q06 2Q07 2Q08 2Q09 2Q10

Afghanistan 5% 12% 22% 34% 48%

Bahrain 112% 127% 174% 197% 217%

Iran 13% 24% 60% 79% 93%

Iraq 26% 36% 49% 66% 76%

Israel 134% 137% 133% 129% 127%

Jordan 62% 77% 80% 90% 101%

Kuwait 97% 105% 113% 132% 151%

Lebanon 27% 29% 32% 50% 63%

Oman 50% 67% 87% 102% 115%

Palestine 30% 38% 49% 68% 92%

Qatar 100% 134% 177% 232% 320%

Saudi Arabia 71% 100% 110% 128% 142%

Syria 20% 29% 37% 41% 48%

Turkey 65% 76% 84% 83% 79%

UAE 107% 141% 197% 212% 236%

Yemen 12% 17% 24% 31% 36%

• • • • • •

Totals 40% 52% 69% 79% 87%

Source: industry sources, Blycroft estimates c. Blycroft 2011

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AFRICA & MIDDLE EAST:

FT continues emerging markets watch

According to France Telecom’s Chief Executive Officer Stephane Richard its negotiations for assets in Iraq and Cambodia
are progressing, and it may yet consider Algeria.

Talks on a possible deal for a stake in Iraq’s Korek Telecom are more advanced stage than those for Cambodia’s Mobitel,
according to a report by Bloomberg.

France Telecom is looking toward fast-growing countries in Africa, the Middle East and Southeast Asia to offset stagnant
revenue at home, and will invest up to EUR 7 billion (USD 9.03 billion) in emerging-market deals by 2015 as part of its plan
to double revenue from those countries.

The CEO said that Algeria is being monitored, as it could seek a presence either through existing operator Djezzy or other
means, although he said that there are no discussions currently on entering the Algerian market.

In Iraq, France Telecom may take a minority stake in Korek along with "a financial partner " also active in logistics, and with
whom FT has already co-operated elsewhere, the executive said. FT has invested in Kenya with Alcazar Capital, a Dubai-
based private equity firm spun off from Agility Logistics in 2009. In 2007, Alcazar provided Korek with a USD 250 million
convertible loan. FT took control of Telkom Kenya in partnership with Alcazar in 2007.

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AFRICA:

M-PESA on track for DRC and Mozambique launches

Safaricom is continuing to develop its plans to extend its M-PESA mobile money transfer service across Africa. The move
comes less than two months after MTN and Western Union partnered to introduce international remittance services in 21
countries where MTN is active. Meanwhile, Airtel’s Zap has also been steadily expanded over the past year.

The M-PESA service is currently offered in South Africa, Kenya, Tanzania and Afghanistan and is currently being piloted in
India. Safaricom is in partnership with Vodafone for the provision of mobile commerce services in the region, with plans to
expand the service to the Democratic Republic of Congo, Mozambique and Lesotho.

Former Safaricom CEO Michael Joseph who is Chairman of both Safaricom and Vodacom is expected to lead the
expansion of the M-PESA across Africa. Vodafone holds a 65 percent stake in Vodacom Group, based in South Africa. M-
PESA was launched by Safaricom in 2007 and now has some 13 million subscribers.

Last year, Airtel’s Zap was expanded to Malawi, Nigeria and Sierra Leone after successful rollouts in Kenya, Uganda and
Tanzania, and claims it has 10 million subscribers in total. Zap is part of Airtel's One Network Platform, which allows
subscribers to call countries where the service is available without paying roaming charges. Subscribers can remit funds
from and to those countries where the Zap service is enabled.

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ALGERIA:

OTA advisors named

Law firm Shearman and Sterling LLP France has been provisionally named as the winner of an international tender
mounted by the government to provide advice on the purchase of mobile operator Orascom Telecom Algeria (OTA).
According to a notice on the contract award published by the Ministry of Finance, Shearman and Sterling LLP France
scored 98 points out of 100 (58/60 in technical bid and 40/40 in financial bid). The firm bid USD 2.155 million and proposed
a period of 100 days for completion of the evaluation of OTA.

A spokesman for the law firm told AMETW that the appointment of Shearman & Sterling will come into effect upon the
expiration of a 10-day period during which the decision may be appealed by the other bidders.

The spokesman also confirmed that the economic aspects of the valuation will be carried out by FTI Consulting, a US firm
specialised in economic and litigation consulting. Previously, Djezzy had been valued between USD 2 and 3 billion while
Orascom Telecom's shareholders offered to sell Djezzy to the Algerian Government for USD 7.8 billion in October 2010.

Bids were received from ten firms: Renaissance Capital (UK), Rothschild (France), Global Investment House (Kuwait),
Goetz Partners (Germany), Curtis, Mallet-Prevost, Colt & Mosie LLP (USA), HSBC (UK), Grant Thornton (France), Swicorp
(Saudi Arabia), RSM Ahmed Mansour (Tunisia) and Shearman and Sterling LLP (France). It was previously reported by the
Sawt Al Ahrar newspaper that US law firm Curtis, Mallet-Prevost, Colt & Mosie had won the bid.
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ANGOLA:

More districts now covered by Unitel

Unitel has extended its GSM network coverage to three more districts, namely Uige, Huila and Cunene, news agency
ANGOP has reported.

The operator said that its signal has been extended to the districts of Quimbele, in Uije Province, Tchivinguiro (Huila) and
Cuvelai (Cunene), bringing its total footprint to 128 municipalities. Unitel has coverage in all 18 provinces, and had covered
118 municipalities by end-September 2010, up from 104 a year earlier.

Unitel is Angola’s largest mobile operator by subscribers with some 73 percent of the mobile market at the end of
September 2010.

Source: industry sources, Blycroft estimates c. Blycroft 2010

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GHANA:

Vodafone hands network management to Huawei

Huawei has announced a five-year managed services agreement with Vodafone Ghana, and will take responsibility for the
Operations and Maintenance of the Vodafone Mobile, Microwave, SDH, and Fixed Switching networks. Huawei staff will
also be responsible for network planning and optimisation, the Network Operations Centre, and management of the spare
parts.

The network operations agreement guarantees the performance and quality of the Vodafone network, which is used by
multiple vendors nationally. A number of Vodafone Ghana employees will be employed by Huawei in similar roles and
receive training on new processes, technology and tools that will be introduced by Huawei.

The deal was signed following a six-month procurement and authentication process, and is one of the single largest
procurement programs undertaken by Vodafone Ghana.

Vodafone was the third largest mobile operator by subscriber numbers at the end of September 2010, with some 16
percent of the market.
Source: industry sources, Blycroft estimates c. Blycroft 2011

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ISRAEL:

February tender starts to attract bidders

A tender in February for a new mobile operator licence is expected to see Xavier Niel compete. Niel was the founder of
French telecom group Iliad.

An Israeli government source has been quoted by the Reuters news service as saying that Niel and former Free Chief
Executive Michael Boukozba, have paid NIS 25,000 (USD 7,000) to participate in the tender.

Israel has four mobile phone operators, the largest being Cellcom followed by Partner Communications, Bezeq’s
Pelephone and Mirs. The mobile phone penetration rate in Israel is estimated at about 125 percent. The government is
looking to improve competition by fostering conventional mobile network operators as well as through mobile virtual
network operators (MVNOs).

Source: industry sources, Blycroft estimates c. Blycroft 2011

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JORDAN:

Handset availability checking 3G growth says Orange

Orange Jordan says that it has signed 150,000 3G subscribers in 2010. Nayla Khawam, CEO of Jordan Telecom Group
(JTG), said that the operator is looking at extending 3G service nationally and the telco plans to cover around 50 percent of
the population by February 2011.

Source: industry sources, Blycroft estimates c. Blycroft 2010

Raslan Diranieh, Chief Financial Officer of JTG was quoted by The Jordan Times as saying that the reason for the slow
uptake was due to the shortage of 3G-enabled handsets, which he put at 22-25 percent of all mobile phones in the market.

Diranieh said handset pricing ranges between JOD 30 (USD 42) and JOD 40 (USD 57), whilst the cheapest 3G handset
starts from JOD60 (USD 85).

Khawam noted that the number of 3G subscribers increased significantly in the last two months of 2010.

Orange Jordan paid USD 17 million for a 15-year 3G licence in August 2009 and initially launched 3G service in Amman in
March 2010 before expanding coverage.

JTG however remains unhappy about other operators being licensed for 3G during its period of exclusivity, and it has
reportedly commenced legal action against the government and is seeking JOD 120 million (USD168 million) in
compensation.

In August 2009 the Telecommunications Regulatory Commission (TRC) granted JTG a JOD 50 million 3G licence which
guaranteed it a year of exclusivity from the date of commercial launch, which took place in March 2010. However JTG
claims that the government breached the deal by granting Zain a 3G concession. The government however claims that no
such concession has been awarded to Zain, saying that Zain has only been allowed to test its network.

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KENYA:

SMS rates savaged by Safaricom

Safaricom has cut its SMS rates across all local networks. Safaricom CEO Bob Collymore said the reduced SMS rates are
a permanent tariff applicable to all pre- and post-paid subscribers. "We are lowering the cost of sending text messages to
any local network by giving our entire subscriber base an SMS rate of KES 1 for Safaricom to Safaricom and KES 2 for
SMS's from Safaricom to other local networks, " said Collymore.

This represents a saving of up to 71 percent, when sending Safaricom to Safaricom SMS's, and up to 60 percent when
sending SMS's to other local networks. Rates were KES 3.50 for SMS's sent within the Safaricom network and KES 5 for
SMSs sent to other local networks.

A few hours after Safaricom’s announcement the Communications Commission of Kenya (CCK) directed all mobile
operators to lower SMS termination rates and pass the benefits onto users. Operators are expected to interconnect at KES
0.60 per SMS, a rate which they are expected to reduce progressively to KES 0.05 by 2013.

The regulator said it has issued an addendum to the Interconnection Determination No.2 of 2010 on SMS termination rates
and ordered operators to implement lower termination rates from 1 January 2011. The rules, which were issued in August
2010, noted that the prevailing wholesale termination rates for SMS were way above the incremental costs of providing
these services across networks.

Safaricom remains the dominant mobile player with 77 percent of the market at the end of September 2010, down from 80
percent in the first quarter. This reflects Airtel's improving position having risen from 10 to 13 percent share in the same
period.

Source: industry sources, Blycroft estimates c. Blycroft 2011

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KUWAIT:

VIVA promotes CTO to CEO

VIVA Kuwait has appointed Salman Al Badran as its new Chief Executive Officer, replacing Nagib Al Awadhi, the Al Watan
daily newspaper has reported. Awadhi is to take another post in the Saudi Telecom group. Badran was promoted from
Chief Technical Officer.

VIVA from its launch in late 2008 had signed some 684,000 subscribers by the end of 3Q 2010, giving it a respectable 16
percent of the mobile subscriber market. Zain had 44 percent of the market against Wataniya's 40 percent.
Source: industry sources, Blycroft estimates c. Blycroft 2011

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MALAWI:

Court backs MACRA interconnect regime

The High Court of Malawi has upheld a decision by Malawi Communication Regulatory Authority (MACRA) to introduce the
new legislation by lifting an injunction obtained by Celtel (Airtel) and Telekom Networks (TNM).

The High Court issued its ruling on 23 December 2010, and MACRA subsequently instructed all operators, both mobile and
fixed, to abide by its new interconnection law, which is described as ‘Sender Keeps All’ (SKA).

A report by the Bizcommunity news portal suggests that some operators have yet to respond to the ruling. Airtel Malawi MD
Saulos Chilima was quoted by Bizcommunity as saying that the management team needs to meet before it can determine
its position.

In February 2004 MACRA imposed a network-to-network interconnect rate for both fixed and mobile operators of USD 0.04
per minute. The ruling was an interim measure as the operators were expected to offer their own voluntary interconnect
deals within 12 months from the date of the ruling. This rate endures.

MACRA said in a statement following the ruling: "This means therefore that the court's decision vindicates the legality and
rationale of MACRA's decision to intervene in the interconnection dispute that currently exists among operators."

Airtel is the largest mobile operator by subscriber numbers, with some 2 million subscribers at the end of September 2010,
or 67 percent of the market. It competes with Telekom Networks Malawi Limited.

Source: industry sources, Blycroft estimates c. Blycroft 2011


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New CEO for MTL

Charles Chuka has been appointed as Chief Executive Officer of Malawi Telecommunications Limited (MTL), replacing
expatriate Bernd Flack who left in December 2010.

Hilda Singo MTL, Company Secretary and Chief Administration Officer described Chuka as highly educated, adding that
the appointment had been made following a "rigorous selection and interview process". A master of philosophy in monetary
economics from Glasgow University holder, Chuka once worked as General Manager for Economic Services at the
Reserve Bank of Malawi (RBM).

Chuka is the second indigenous Malawian to be appointed to the top spot in a telco: last year Saulos Chilima was
appointed as Executive Director of Celtel, now Airtel.

Malawi Telecommunications Limited (MTL) lost its monopoly status with the arrival of the second fixed telephone operator,
Access Communication, which is now rolling out its operations.

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MOROCCO:

Dakhla selected as inwi testbed

Inwi – the third mobile operator in Morocco by subscriber numbers – has said that it recently deployed SDR (Software
Defined Radio) from a pilot site in Dakhla. SDR will help to optimise technical performance, and so better serve its growing
subscriber base, which now stands at 3.5 million.

Source: industry sources, Blycroft estimates c. Blycroft 2010

Hasnaa Youlal, Cluster Director of Networks' said: "The SDR technology…allows the operator to upgrade its network - GSM, UMTS, LTE, ... [and is]
flexible, economical and scalable ". He added that the basic principle is the convergence of various technologies in the same physical elements, and
so achieves economies of scale. The transition from one technology to another (GSM, UMTS, HSPA +, LTE) is thus simply achieved by software,
which greatly reduces operating costs.

SDR is a radio communication system in which hardware (e.g. mixers, filters, amplifiers, modulators/demodulators,
detectors, etc.) are replaced by software. Software radios have significant utility for the military and mobile phone services,
both of which must serve a wide variety of changing radio protocols in real time.

Dakhla was chosen as a pilot site for the launch of this new technology as the region is booming economically, with full
potential for development and is therefore is prominent in the operator's Morocco 2013 plan.

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MOZAMBIQUE:

Movitel outlines first year investment plans

Movitel has said that it will invest up to USD 465 million in setting-up its network over the next five years – USD 120 million
will be spent in the first year to launch the network.

A partnership consisting of Vietnamese company Viettel Telecom (70 percent) and Mozambique’s SPI 30 percent - a
company that is linked to the government), working under the Movitel brand, was awarded the third mobile operator licence
in November 2010. After technical and financial assessment of the bids Movitel was ranked first, followed by Uni –
Telecomunicações and TMM – Telecomunicações Móveis de Moçambique.

Uni - Telecomunicações was a partnership of the Mozambican group Insitec and Angolan mobile operator Unitel, whilst
TMM (Telecomunicações Móveis de Moçambique) was a consortium of Portuguese groups Portugal Telecom and
Visabeira.

The Regulator said that Movitel’s proposal had received the highest classification in the technical assessment and the
second-highest in terms of what it proposed to pay for a licence. It bid USD 28 million, which was less than the USD 32
offered by UNI – Telecomunicações, but more than the USD 25 million offered by TMM.

According to Blycroft’s Mobile Operator database, the country had an estimated 6.55 million subscribers at the end of 2010,
representing a mobile penetration level of 29 percent. mCel is the dominant operator, with a market share of 57
percent, compared to 43 percent for Vodacom.

Source: industry sources, Blycroft estimates c. Blycroft 2010

Plans by the government to sell a small stake in Moçambique Celular (mCel) have been discussed in the past, but no
progress has been made so far.

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NIGER:

Mobile operators to fund public sector pay rise

The government is to levy new taxes on mobile operators to help fund anticipated record state spending. Some XOF 1
trillion (USD 1.9 billion) is required to be raised for infrastructure and anti-poverty projects, as well as funding a 10 percent
increase in public sector pay.

Government spokesman Mahaman Laoualy Dan Dah made the announcement on state radio last week according to a
Reuters report. He said that the contribution from the telecom sector to the budget has been ‘weak’ up to this point, despite
the enormous resources of the operators.

No details of the new taxes have been released. Bharti Airtel, Atlantique Telecom's Moov, France Telecom's Orange, and
state-owned SahelCom are the main operators. Airtel is the primary player with some 57 percent of the mobile market at
the end of September 2010, although mobile penetration stands at a modest 21 percent.

Source: industry sources, Blycroft estimates c. Blycroft 2011

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NIGERIA:

Glo launches 4G network

Globacom on Tuesday launched its 4G-LTE network, with enhanced data transfer rates. Globacom’s Group Chief
Operating Officer Mohamed Jameel was reported by WorldStage on-line as saying that it will further enhance demanding
applications such as interactive TV, mobile video blogging, advanced games or professional services. He added: "For our
subscribers, LTE offers the key benefits of performance and capacity ".

4G-LTE is designed to be backwards-compatible with GSM and HSPA, and incorporates Multiple In Multiple Out (MIMO) in
combination with Orthogonal Frequency Division Multiple Access (OFDMA) in the downlink and Single Carrier FDMA in the
uplink to provide high levels of spectral efficiency and end user data rates exceeding 100 Mbps. It is also backed with major
improvements in capacity and reductions in latency.

Key Contacts:
Globacom Group Chief Operating Officer, Mr Mohamed Jameel
Globacom Chief Technical Officer (Engineering), Mr Peter Schubert
Glo Ambassador, Uche Jombo

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Next bidder for NITEL please step forward


The New Generation Consortium which was declared the preferred bidder for NITEL by the National Council on
Privatisation (NCP) has been unable to pay the USD 750 million initial bid security at the expiration of the extended
deadline of 23 December 2010.

Consequently the management of Brymedia West Africa Limited is reported by the NEXT news portal to be showing an
interest in establishing its claim as the second-placed bidder. During the bidding last February Brymedia, which has a
technical partnership with Telecom New Zealand, was placed second with an offer of some USD 551million, excluding the
Code Division Multiple Access (CDMA) network, after Omen International Limited (BVI), which emerged the reserve bidder
with USD 957.0 million.

A senior Bureau for Public Enterprises (BPE) official has told NEXT that another extension is unlikely, and that BPE is now
looking beyond the New Generation offer. The NCP chairman and vice president, Namadi Sambo is expected to be
approached for his approval to cancel the bid. The options now are either to invite the reserve bidder to come forward and
take up the bid, or for the bidding process to start afresh.

Brymedia is reported to have already notified the BPE it would consider raising its bid to USD 600 million.

It is claimed that under Transcorp’s management, NITEL’s connected lines dropping from over 400,000 to less than
100,000, while working lines declined from over 296,000 to about 5,000.

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QATAR:

Vodafone adds 1,200 new subscribers daily

Vodafone Qatar subscribers has reported 711,000 active subscribers at the end of 2010 representing a growth of 18
percent over the quarter, or over 1,200 new customers per day. At the end of September 2010, Vodafone Qatar had
announced that it reached 601,000 customers. Vodafone Qatar has 100 percent 2G coverage and has also deployed 3G
technology, UMTS 2100 and 900, which provides 3G coverage to 98 percent of Qatar’s population.

Vodafone Qatar achieved a total revenue of QAR 652 million (USD 179 million) in the final three quarters of 2010, of which
some QAR 266.5 million (USD 73.2 million) was generated in the final quarter, representing a 27 percent increase on the
previous quarter. Wade Kirkland, Acting Chief Financial Officer said: "This is our third consecutive increase in quarterly
ARPU and represents Vodafone Qatar’s progress in bringing new products to market and acquiring customers in new
target segments".

Loss before interest, tax, depreciation and amortisation (EBITDA) continued to improve, with EBITDA of QR 30.9 million for
the nine months to 31 December 2010, a six-fold improvement on last year’s result, with EBITDA positive for the first time
in 4Q 2010 at QAR 1.0 million.

In the last quarter Vodafone has launched its Money Transfer and credit reload application in Facebook, in addition to the
launch of Vodafone’s services to Business customers.

According to Blycroft's Mobile Operator database, Vodafone has around 25 percent of the mobile subscriber market at the
end of 2010.
Source: industry sources, Blycroft estimates c. Blycroft 2010

Key Contacts:
Vodafone Acting Chief Executive Officer, John Tombleson
Vodafone Acting Chief Financial Officer, Wade Kirkland

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RWANDA:

Micro-SIMs for Tigo subscribers

Tigo Rwanda has announced that it is providing micro-SIM cards for subscribers with smart phones particularly those using
the 3G iPad and iPhone 4. The company’s Marketing Manager Nina Ndabaneze said on 10 January 2011 that the micro-
SIM is now available for subscribers wishing to acquire new numbers and those who wish to swap and retain their old
numbers.

She said that the price of a Tigo Go Wireless data modem had been cut from RWF 25,000 (USD 41.54) to RWF 19,700
(USD 32.74), and so the cheapest 3G modem in Rwanda, and in the period 10-16 January, the price per megabyte will be
RWF 15, down from RWF 30.

Tigo is also to introduce two ZTE low cost smart phones - the G-R352 that costs RWF 33,700 (USD 56) and the F102 for
RWF 35,700 (USD 59.40) which each handset coming with free Internet subscription for one month.

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SAUDI ARABIA:

Huawei to overhaul Bravo operations

Bravo announced on Sunday that it had signed Huawei to modernise its operations and increase the efficiency of technical
and engineering work processes and management.

Mohamed bin Abdulaziz Al-Aqil, Bravo’s Chief Executive Officer said it had contracted Huawei with the aim of modernising
and improving work processes so as to achieve the ‘highest levels’ of performance in all departments and operational units.

In particular the deal will focus on efficiency and productivity in the operational units for supporting sales and marketing,
customer service and billing. Huawei claims to have some 500 staff now deployed in Saudi Arabia.
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Zain looks to FRiENDi for new offering

Zain has launched the FRiENDi pre-paid package through a collaborative venture with Connect Saudi Limited. Connect
Saudi Limited is a subsidiary of FRiENDi Group and is assisting Zain Saudi with the operation and distribution of the
FRiENDi mobile package on an outsourced basis.

The package provides the lowest international call rates for destinations such as the Philippines, Hong Kong, Singapore,
USA, Canada, UK, Bahrain, the UAE, etc. I also provides the lowest international SMS price of at SAR 0.25 (USD 0.07).
Local calls to 3 ‘friends and family’ numbers are priced at SAR 0.40.

Omar Al-Said, the Chief Executive Officer of Connect Saudi, said: "With our team’s regional experience and success with
the international segment and Zain’s extensive hold of Saudi market, the FRiENDi mobile package is sure to be a hit
especially among the people residing in Saudi who have a piece of their heart abroad."

The FRiENDi mobile package was launched on 10 January 2011.

Zain is currently ranked third by mobile subscribers with some 17 percent of the market at the end of September 2010.

Source: industry sources, Blycroft estimates c. Blycroft 2011

Key Contacts:
Connect Saudi Limited Chairman, Mohammed Bin Saud Bin Naif Alsaud,
Zain Saudi CEO and managing director, Dr Saad Al Barrak, Ahmad Al Faifi

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SOUTH AFRICA:

New Cell C network meets national and local targets

Cell C has reported that coverage targets for the Gauteng region, as well as national coverage, for its new HSPA+ network
have been achieved according to a report by ITWeb. In November Gauteng had full network access, although coverage
was limited to 62 percent of the population in the Johannesburg and Pretoria metro areas.

Cell C CEO Lars Reichelt said that the coverage area was not what had been planned due to a World Cup network freeze
that lasted longer than expected, with Cell C not being able to lay sufficient fibre in time.

It has confirmed it met and exceeded its target of 89 percent coverage by mid-January for the Johannesburg and Pretoria
metro areas. It also met and exceeded its target of 34 percent national coverage.

Roll-out of the new network commenced in September, connecting Port Elizabeth, Bloemfontein, Durban, Pietermaritzburg,
Cape Town, George, Nelspruit, Polokwane, Richards Bay and Witbank, at which time national coverage was only 32
percent.

The operator is now focused on longer term targets, including 67 percent population coverage by mid-2011 and 97 percent
coverage nationally by the end of 2011. It is also looking to double its current network speed of 21Mbps within the next 3-4
months.

Cell C is currently ranked third in the mobile market with a market share of approximately 15 percent.

Source: industry sources, Blycroft estimates c. Blycroft 2011

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PPT deal for NECO

Mobile Tornado Group has announced an exclusive partnership with NECO, which supplies emergency, safety and security
products, to deliver Push to Talk (PTT) mobile communications services into the South African market.

NECO has invested heavily in the PTT market and has formed a new division called Instacom. This partnership with Mobile
Tornado will enable a wide range of South African organisations, from both the public and private sector including the
emergency services, to benefit from a variety of PTT, Push to Locate and Push to Alert applications allowing them to
communicate with their employees more effectively and efficiently than when using conventional mobile services and
private mobile radio.

Jeremy Fenn, Managing Director, Mobile Tornado Group said: " [South Africa] represents the first territory where we have
signed up to an exclusive relationship…. Our service has already been adopted by a major South African mobile
operator…"

Mobile Tornado's patented Internet Protocol Radio Service (IPRS) technology has been successfully deployed in networks
around the world. The suite of IP-based, OMA standards-compliant, services provide real time, 'always-on', bandwidth-
efficient communications across a range of mobile networks and devices, including compatibility with forthcoming LTE
(Long Term Evolution) 4G mobile networks.

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Spectrum sale speeds-up

The auction of spectrum in the 2.6GHz and 3.5GHz bands is set to recommence shortly with the appointment of a
specialist auctioneer according to TechCentral.

It is reported that the Communications Minister Roy Padayachie has been sent a list of bidders by the Independent
Communications Authority of SA (ICASA) from which the final selection will be made. ICASA is now apparently awaiting the
return of the minister from vacation. The spectrum being offered can be used for next generation of wireless broadband
services.

ICASA last year stopped the original sale saying the auction process was not in line with government’s policy on spectrum
management. On reflection, it decided to ensure the allocation would suit new technologies such as long-term evolution.

ICASA also admitted that it was seeking an overseas auctioneer to assist it with the process, after struggling to find an
appropriately qualified auctioneer locally. Under guidelines issued in May 2010, bidding will start at ZAR 750,000
(USD109,417). ICASA requires 2.6GHz licensees to achieve population coverage of 50 percent within two years of being
granted the spectrum.

State-owned Sentech has 50MHz of spectrum, which it’s not using. iBurst parent Wireless Business Solutions holds
another 15MHz of the band and has applied to ICASA for more.

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SWAZILAND:

Dropped calls a challenge for MTN says CAS

MTN Swazi has been criticised over the level of dropped calls by the Consumer Association of Swaziland (CAS). According
to a report by the Swaziland Times the there have been issues from late November onwards, with CAS Chairperson,
Bongani ‘Bhanyaza’ Mdluli, saying that competition would compel MTN to put its house in order and give customers the
service they deserve.

Mdluli said that MTN had blamed bad weather. MTN in a press release said that users where not being disconnected
intentionally, adding that the problem may increase in the summer season when there is a higher base station failure rate
due to power and transmission outages, leaving the remaining base stations heavily congested and prone to dropping
calls.

MTN remains the monopoly mobile operator with 100 percent of the market. Back in May 2010 Swaziland Posts and
Telecommunications Corporation (SPTC) launched its Fixed Wireless network, which was an element of its Next
Generation Networks (NGN), which accommodates a mobile and data network. However MTN called on SPTC to adhere to
the Joint Venture Agreement (JVA), under which SPTC receives dividend payments from MTN, and subsequently the
offering was withdrawn following various attempts to restructure SPTC.

Source: industry sources, Blycroft estimates c. Blycroft 2011

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TANZANIA:

Top-up cash requested by TTCL

Tanzania Telecommunications Company Limited – the State owned telco - has requested a government letter of credit
guarantee to obtain a TZS 322 billion (USD 214.1 million) bank loan to provide working capital, Tanzania’s Daily News has
reported.

Telecommunication Workers Union of Tanzania General Secretary Junus Ndaro told a news conference in Dar es Salaam
on Monday that the government should take the blame for TTCL’s poor performance since a decision to partly privatise the
company was made in 2001. In June 2005 it opted to run TTCL jointly with MSI Detecon of The Netherlands, with the
government owning 65 percent of the equity, and the remainder held by the partner.

This decision was made after the separation of TTCL and Celtel Tanzania, in which MSI Detecon obtained 60 percent in
Celtel Tanzania, while the government retained 40 percent.

TTCL remains a small-bit player in the mobile market, ranked 5th. by mobile subscriber numbers (in a field of 7), and at the
end of September 2010 had a market share of just 0.48 percent.

Source: industry sources, Blycroft estimates c. Blycroft 2011

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UGANDA:

UTL creates interconnect irritation for rivals

Uganda Telecom (UTL) is facing action in the Commercial Court from Airtel and MTN Uganda for failing to pay some about
UGX 18 billion (USD 7.6 million) in interconnect fees. The overdue fees have accumulated over a two year period after it
allegedly failed to pay its two rival operators for enabling its subscribers to make calls to and from other networks,
according to a report in the Daily Monitor newspaper.

Airtel and UTL agreed to pay between UGX 95 and UGX 151 per call to each other’s network according to the
interconnection deal signed in 2000.

Airtel is seeking UGX 3.76 billion of UGX 5 billion in interconnection fees from Uganda Telecom. This is in addition to
interest at 11 percent per annum and legal costs. Airtel is also seeking UGX 1.3 billion and UGX 45.5 million in two
separate cases involving the use of its equipment.

MTN is seeking some UGX 14.7 billion (USD 6.2 million) in interconnect between September 2008 and November 2009.
UTL appears to have paid about UGX 3.5 billion of the total claim, but refusing to pay UGX 3.45 billion arguing that this was
traffic terminating in Southern Sudan, and therefore not covered by the domestic interconnect deal. The complication is that
the UTL owns a majority stake in the Sudanese operator concerned.

At the end of September 2010, UTL had approximately 11 percent of the mobile subscriber market with some 1.2 million
subscribers.

Source: industry sources, Blycroft estimates c. Blycroft 2011

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UNITED ARAB EMIRATES:

Court issues notice to Etisalat Indian unit

Etisalat is one of 11 Indian telecom operators that has been issued with a notice by the Indian Supreme Court on Monday,
along with the Department of Telecom (DoT) and Telecom Regulatory Authority of India (TRAI). Responses are required
within a three week time scale and the date of the next hearing has been set for 1 February 2011.

Janata Party President Subramanian Swamy filed an action under Public Interest Litigation (PIL) and subsequently said
that the entire process of granting 2G licences should be cancelled.

In late November TRAI asked for 62 licences given to five companies including Etisalat (Swan), Uninor and Videocon to be
cancelled. Non-compliance with the licence conditions was cited as the primary reason, whilst the Comptroller and Auditor
General (CAG) also criticised the Telecom Ministry for irregularity and impropriety in issuing licences to new players in
2008 which subsequently resulted in substantial losses to the Exchequer. A report by the CAG claimed that the policies
implemented by Raja of granting 2G licences had resulted in substantial loses to the national exchequer.

The Minister of Communications and Information Technology, A Raja, resigned following publication of the report. Possible
penalties for Etisalat could be payment of a penalty or relinquishment of some or all of its licences.

The other telcos concerned are Uninor, Loop Telecom, Videocon, S-Tel, Allianz Infra, Idea Cellular, Tata Teleservices,
Sistema Shyam Teleservices, Dishnet wireless and Vodafone-Essar. Batelco has an interest in S-Tel.

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du strengthens northern footprint

The Federal Electricity and Water Authority agreed this week to grant telecom operator du access to its fibre optic network
under a deal the two singed a year ago. du will now be able to offer fixed line services such as voice, TV and Internet to
areas in the northern Emirates.

FEWA said that the partnership allows du and FEWA to optimise their respective network resources to enhance the scope
of their services and operations efficiency. du chief executive Osman Sultan said this was part of its efforts to strengthen its
fixed and mobile network capabilities, and was a significant part of its preparations to create a national fixed footprint this
year.

du now has around 29 percent of the Fixed Line market, recording some 515,400 lines at the end of September 2010.

Source: industry sources, Blycroft estimates c. Blycroft 2011

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Country Report

Paul Budde Country Report: Kenya - Key Statistics, Regulatory & Fixed-Line Telecoms Overviews

SYNOPSIS

Kenya's telecommunications and broadband market is undergoing a revolution following the arrival of three fibre optic
international submarine cables in Kenya in 2009 and 2010 (Seacom, TEAMS and EASSy), ending its dependency on
limited and expensive satellite bandwidth. Bandwidth prices had already fallen significantly following the liberalisation of
international gateway and national backbone network provision in 2005, but they have now fallen by 90%, enabling
cheaper tariffs for telephone calls and broadband Internet services.

The full report is in the Subscriber Archive


Additional Information

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