HARGEISA — On April 19th of this year, a submarine communication cable known as Eastern Africa Submarine Cable System (EASSy) running more than 10,000 km was deployed in the Djibouti Republic, marking a milestone in telecommunication in Africa. In the coming weeks, the cable is expected to be delivered in the port of Berbera in Somaliland, ahead of the cable launch in June.
The EASSY cable will connect the entire African continent from Mtunzini in South Africa to Port Sudan, in a nine landing points in nine countries including the Somali capital, Mogadishu, however due to security it was instead brought to Port of Berbera, in Somaliland.
EASSY will take on the existing Seacom cable, the first cable to provide broadband to countries in East Africa.
The announcement of EASSY cable in Somaliland has started fierce telecommunication competition between local, regional and international providers. The Berbera hub will connect Somaliland and the landlocked Ethiopia, whose population is more than 85 million but internet and telephone usage is still one of the lowest in Africa (1.2% of the population has a telephone and 0.1% use internet) to Europe, Asia and rest of Africa. Ethiopian experts blame the low market penetration on the government’s monopoly practice, giving the national operator, Ethiopian Telecommunications Corporation (ETC) exclusive rights. However, a report Somalilandpress has received, stated, ETC signed an agreement worth $48 million with Seacom cable to be delivered via Djibouti in March 30th of 2010.
On Wednesday May 5th, the London-based British-American firm, Leadinspiration, Inc. announced it signed a “Memorandum of Understanding, Legal Framework as well as a Proceedings contract to develop a Next Generation Network in several nations in Africa” with members of the African Union and that “the contracts have been approved by government officials as well as for the Telecommunications Associations, pertaining for each nation,” in a press release. It added it would deliver the fastest broadband in Africa to Somaliland first, where it will unveil the first phase of it’s two 3G Networks and 4G Technology by Q3 2010 (see Somaliland to get Africa’s fastest internet – up to 150 MB).
On Saturday (8th of May), a local Somaliland company, Somaliland Cable (SomCable) Ltd announced it was contracted to deploy the submarine cable from Djibouti to Somaliland. It said in a statement (in Somali), the project will begin in two phases, it would pull the submarine cable from Djibouti port to Berbera by sea (submarine cable) and on land, it would run cost effective land based long haul fiber-optic communications networks from Djibouti to Somaliland. It said, it was necessary to have two in case one fails, the other will be kept as backup. SomCable declared it would invest $35 million USD on the project and would employ more than 10, 000 locals.
SomCable, revealed also it was partnering with two leading international telecommunication firms, Alcatel-Lucent, an American-French company with a revenue of more than $19 billion (USD), and Sagemcom, a French and a leader in broadband technology.
It added: “SomCable was contracted to deliver these services in 2009 in accordance with the Somaliland telecommunication law “(National & international long distance – NLD & ILD – Service license agreement for provision of access facilitation, landing facilities at cable landing stations for international submarine cable, bandwidth capacity & co-location facilities)”.
SomCable said in it’s press release, that the company was contracted for the Somaliland optic fiber cable for 25 years and the work will begin in the mid of 2010.
It said the benefits of having a local company for this project was:
* Somaliland communication will no longer come under Mogadishu
* Somaliland would be treated as an independent and capable state in the region, and would boost national security including coast and border petrol. It would also greatly benefit international aid agencies in the country, national universities, hospitals, education by connecting them to the rest of the world.
* It would create jobs for 10,000 locals
* The company had both the capacity and financial means and should be inspire other wealthy Somalilanders to invest in similar magnitude projects or bigger.
SomCable also revealed the new cable will create a competitive environment where bandwidth prices will fall, so that service providers can pass this benefit to customers and it would connect the region with the rest of the world. SomCable also plans to deliver the cable to Africa’s second most populous nation, Ethiopia via Berbera.
According to the local news website, Ubaxa Cusub, a Somali company, Dalkom Somalia, owned in Mogadishu that comes under Sheikh Sharif’s Transitional government is bidding for the fiber optic contract. It stated, the company was originally contracted by EASSY however due to the instability in Somalia, the cable could not be delivered in Mogadishu, instead, it was taken to Berbera as one of the landing stations.
It added that the Somali firm, wants the contract entirely which could jeopardize national security in Somaliland and described their motives as a “political force” to undermine Somaliland’s sovereignty by Mogadishu.
The chairman and CEO of Dalkom Somalia, Mr. Mohamed Ahmed “Jama Dalkom”, is believed to be currently in Hargeisa to try to convince Somaliland administration to ink his firm with the contract.
However, local telecommunication and IT experts have expressed concern about Dalkom Somalia, citing a company that comes under Somalia’s lawlessness should not be awarded as it may support and fund regional militants such as Al Shabab. They are worried, the reason EASSY cable was not delivered in Somalia was due to security and same players could also spread Somalia’s instability in this part of the region.
The Fiber Optic initiative in the country is expected to boost communication in the country as well as the region. It will also start new fierce competition in an area that was already competitive and will certainly drive prices even further down, as the region, no longer has to pay for expensive satellite communication.
There are no telecommunication regulatory institution in Somaliland and prices are uniform and adjusted according to inflation and the exchange rate to the US-dollar in cooperation with Somaliland Telecommunication Operators Association. This prices and information are then provided to the Postal and Telecommunication Ministry, however the government does not interfere with the local market. This environment has created a boosting telecommunication sector despite lack of international recognition.
There are seven telecom providers in Somaliland with a population of 3.5 million and all of them are locally owned. Fierce competition among the operators has driven consumer costs down for instance an international mobile call is as low as $0.30 per minute or less, six times lower than most African states. The introduction of Fiber Optic, is expected to create even more fierce competition between the national and international operators. Berbera could also be the next telecommunication hub for the Horn of Africa.
Currently Somaliland telecom providers such as Telesom, Telcom and SomTel provide locals with mobile banking system dubbed “ZAAD Services”, wireless and solar-powered communications. The largest provider is Telesom, according to Haatuf newspaper, it controls 70 per cent of the market translating to $48 million net profit as of 2009. This is due to the low tax rates in Somaliland and the growth of Somaliland community in the Diaspora who continue to stay in touch with those back home.
EASSY was created due to the insufficient supply for telecommunications within the region and the fact that sub-Saharan Africa has the highest level of international telephone traffic per main line in any region in the world.
The republic of Somaliland, is stable but unrecognized, however it continues to have some degree of contact with different nations in the region and the world. By the end of 2010, this unrecognized state could enter African telecommunication milestone by been the first country with the fastest broadband. This could well encourage foreign investors and African-based companies to invest in Somaliland, which could be lucrative for those who want to tap into Somaliland’s hidden resources and Africa’s second most populous nation, Ethiopia, through Somaliland cable.