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Namibian govt unfazed by critics of 081-everyone project

Namibian govt unfazed by critics of 081-everyone project

Despite ongoing criticism of its continued focus on rural connectivity and the financial impact on state-owned telcos, Namibia's government has launched another high-speed mobile and fixed broadband site in August 2018 – this time at the Tallismanus village in the Omaheke region.

Fully aware of media reports focused on criticism levelled against government's projects with telco MTC (Make the Connection), the country's Minister of Information and Communication Technology Stanley Simataa officially opened the latest site – which features connectivity services including a converged 4G (LTE) TDD/FDD base station.

The Minister said, "It is all part of our Government's plan to help create opportunity in all communities, including rural communities in the far-flung areas of Namibia. We mean serious business when we say that rural and township areas should have the same network experience such as the people who reside in urban areas are accustomed."

He added, "This Constituency has more than 6,300 inhabitants. One should admit, without doubt, that this is a deep, outlying rural area. But the remoteness will not deter the government and its stakeholder like Telecom Namibia to help improve lives through essential infrastructure roll-out."

Critics of the government's rural connectivity strategy and use of state-owned telco resources, including those of MTC, have been quoted in media reports.

In April 2018 former director of Namibia Post and Telecommunications Holdings (NPTH) Ally Angula reportedly clashed with Simataa over "plans to expand Namibia's mobile telecommunications network by using N$1,1 billion from MTC."

In the same month Simataa hosted a press conference to address what was described as "various misrepresentations that have been made on this matter, in particular to put in perspective the 081 everyone project launched last year under the auspices of MTC."

At the session the Minister said profitability and sustainability of telecommunications companies in which government has a stake would not be sacrificed in order to achieve the government's plan to connect more people in rural parts of Namibia.

Govt options

Dobek Pater, Director of Business Development at Africa Analysis says providing coverage to 100% of the population of an African country, especially a country like Namibia (with large landmass and sparsely populated in many areas) has never been easy - especially when it comes to affordable, quality broadband services.

"There are at least two aspects to this to make it work. Technologies which make such connectivity of rural areas feasible like 4G / LTE in low frequencies (700MHz or 800MHz)... (this) makes it a lot less costly for operators to deploy infrastructure in remote areas than using higher frequencies. Other technologies being explored are TV white spaces, for instance. However, an important factor is also the density of an area and uptake or use of services. Another consideration should be whether revenue generated from the provision of the ICT services or whatever the revenue model is sufficient to cover the capex, the operational expenses and generate some profit margin for private sector companies in particular."

Governments can use state-owned operators to deploy infrastructure and provide services, as well as offer subsidies to support the private sector to build infrastructure and/or provide services, or obligate private sector operators to deploy in rural areas in exchange for benefits like spectrum allocation, said Pater.

"Politicians per se should not be 'manipulating' SOEs. This normally leads to disaster. However, the government often has a mandate to deliver services widely, including making basic ICT services available as widely as possible in a country. It is also in the country's interest to ensure that everyone in the society has access to good quality telecommunications (at least broadband services) over time. This is important for issues such as economic growth, country competitiveness and social development (closing the gap within the society)."

Pater said Namibia's government needs to be clear about what role it envisages for a state-owned telco because there is a trade-off.

He added while officials may decide to use the telco to drive the government agenda of ICT inclusivity and use tax money to fund part of the telco's operations to achieve this, the telco cannot then be expected to be a commercial operation able to generate profit - "if it is going to be involved in financially loss-making projects which are undertaken for reasons of socio-economic development of the country."

"If the government has majority shareholding in a telco and majority representation on the board of the company, it can also shape the telco's strategy to engage in projects which may not be profitable but which are necessary and good for the country in the long term, in terms of building out critical infrastructure particularly, if private sector operators are not doing it due to poor economics. An agreement then needs to be reached with the minority shareholders on how they will be compensated, or the government should buy out minority shareholders to be able to direct the state owned telco as required," he said.

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