BRIDGINGBRIDGING THETHE DIGITALDIGITAL DIVIDEDIVIDE ININ AFRICAAFRICA ANDAND AROUNDAROUND THETHE WORLDWORLD

Sofie Maddens, Senior Regulatory and Policy Adviser Telecommunications Management Group, Inc. Executive Seminar on CDMA450 Nairobi, Kenya May 14, 2005 OverviewOverview

„ ImportanceImportance ofof CommunicationsCommunications forfor DevelopmentDevelopment „ GlobalGlobal ImpactImpact ofof WirelessWireless TechnologyTechnology „ TheThe AfricanAfrican RegionRegion „ 3G3G TechnologiesTechnologies inin AfricaAfrica „ IntroductionIntroduction toto CDMACDMA 450450 „ AdvantagesAdvantages ofof CDMACDMA 450450 TechnologiesTechnologies „ CDMA450CDMA450 CaseCase Studies:Studies: BrazilBrazil andand thethe CzechCzech RepublicRepublic „ WirelessWireless TechnologiesTechnologies andand thethe DigitalDigital DivideDivide inin AfricaAfrica

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya IMPORTANCEIMPORTANCE OFOF COMMUNICATIONSCOMMUNICATIONS FORFOR DEVELOPMENTDEVELOPMENT

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya ImportanceImportance ofof CommunicationsCommunications ForFor DevelopmentDevelopment

„ Important economic sectors (banks, insurance companies , airlines, import/export, ...) are almost entirely dependent on communications to thrive and to survive on national, regional and international level „ Coherence of country can be improved through effective means of communications „ Education and health need means of communication and exchange of information to develop in line with international examples

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya GLOBALGLOBAL IMPACTIMPACT OFOF WIRELESSWIRELESS TECHNOLOGYTECHNOLOGY

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya MobileMobile surpassessurpasses fixedfixed……..

Worldwide fixed-line and mobile telephone subscribers, millions 2,500 ƒ By 2002, global mobile

2,000 penetration had surpassed Mobile fixed-line penetration, and the gap has grown in each 1,500 subsequent year ƒAt the end of 2004, there Fixed 1,000 were 1.7 billion mobile subscribers around the 500 world, or approximately 25 percent of the world’s population 0 2000 2001 2002 2003 2004 2005 Source: Telecommunications Management Group, Inc. (2004 estimate and 2005 forecast).

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya ……andand eveneven surpassessurpasses 100%100% penetrationpenetration inin somesome countriescountries

Mobile Subscribers as % of Population, 2004 125 120 ƒBy the end of 2004, seven 115 countries already had mobile 110 penetration of over 100 105 percent and 140 countries 100 had more mobile than fixed 95 90 UK Italy Israel Sweden Hong Kong Hong Czech Rep.

Luxembourg Source: TMG, 2004

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya CountriesCountries withwith moremore mobilemobile thanthan fixedfixed telephonestelephones (2002)(2002)

Source: ITU World Telecommunication Indicators Database

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya ItIt isis notnot justjust aboutabout voicevoice……..

$100,000

y = 23995x R2 = 0.6681

$10,000

$1,000

For each 1%$100 increase in mobile penetration, GDP per capita goes up by US $240 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 120.0% Source: Michael Minges, TMG, and ITU World Telecommunications Database Statistics, 2003

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya …………itit isis aboutabout voicevoice andand datadata $100,000

y = 48948x + 103.27 2 R = 0.7387

$10,000

$1,000 GDP per capita, 2002 GDP

$100 0.0% 0.1% 1.0% 10.0% 100.0% Internet penetration, 2002 For each 1% increase in Internet penetration, GDP per capita goes up by US $593

Source: Michael Minges, TMG, and ITU World Telecommunications Database Statistics, 2003.

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya MobileMobile speedsspeeds

IMT-2000 (3G) 2,400 Broadband (>256 "Offical" speed kbps)

Typical speed

kbps

384 156 350 75 200 550 10 30 60 100 GSM cdmaOne GPRS CDMA 1x EDGE WCDMA CDMA EV-DO

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya THETHE AFRICANAFRICAN REGIONREGION

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya TheThe AfricanAfrican RegionRegion

„ InIn 20012001 mobilemobile subscriberssubscribers surpassedsurpassed fixedfixed subscriberssubscribers inin AfricaAfrica –– thethe firstfirst regionregion inin thethe worldworld toto achieveachieve this.this. „ InIn 20032003 AfricaAfrica hadhad 7373 millionmillion voicevoice telephonytelephony subscriberssubscribers –– 2222 millionmillion fixedfixed andand 5151 millionmillion mobile.mobile. „ InIn 1919 AfricanAfrican countries,countries, mobilemobile phonesphones accountaccount forfor atat leastleast threethree quartersquarters ofof allall telephones.telephones. „ ItIt isis expectedexpected thatthat therethere willwill bebe 6767 millionmillion mobilemobile subscriberssubscribers inin AfricaAfrica byby thethe endend ofof 2005.2005.

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya TheThe AfricanAfrican RegionRegion

„ InIn thethe lastlast fivefive years,years, AfricaAfrica hashas addedadded moremore telecommunicationstelecommunications usersusers thanthan inin thethe lastlast century.century. „ ItIt isis currentlycurrently thethe worldworld regionregion withwith thethe highesthighest levellevel ofof mobilemobile communicationscommunications growth.growth. „ TheThe numbernumber ofof mobilemobile subscribers,subscribers, however,however, onlyonly representsrepresents approximatelyapproximately 11%11% ofof thethe regionregion’’ss population,population, andand thethe mobilemobile penetrationpenetration raterate isis estimatedestimated toto havehave reachedreached onlyonly 9%.9%.

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya TheThe AfricanAfrican RegionRegion

Source: ITU World Telecommunications Indicators Database

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya TheThe RegionRegion ofof AfricaAfrica

Source: ITU Telecom Africa 2004

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya TheThe AfricanAfrican RegionRegion

(e) estimated (f) forecast

Source: ITU Telecom Africa 2004

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya TheThe AfricanAfrican RegionRegion InIn ComparisonComparison toto OtherOther DevelopingDeveloping NationsNations

Source: ITU World Telecommunications Indicators Database

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya 3G3G TechnologiesTechnologies inin AfricaAfrica

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya 3G3G wirelesswireless couldcould bebe AfricaAfrica’’ss solutionsolution toto broadbandbroadband

„ Limited broadband choices on the continent: • Hardly any cable television networks (most multi- channel television is delivered via satellite or microwave); cable modem access is not a viable option • Less than a dozen operators offering ADSL at end of 2004 and only around 150’000 subscribers; relatively few fixed lines in most countries • Existing fixed wireless offerings (other than CDMA2000) are typically not broadband speed (<256 kbps) and not international standards • Wi-Fi is a distribution technology and does not by itself provide access to Internet; • Wi-Max is still unproven and not commercially available technology

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya 3G3G wirelesswireless couldcould bebe AfricaAfrica’’ss solutionsolution toto broadbandbroadband BUTBUT……....

3G3G ••isis herehere today,today, ••isis anan internationalinternational standardstandard ••andand providesprovides broadbandbroadband speedspeed ••inin thethe 450450 MHzMHz band.band.

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya CDMA2000CDMA2000 1X1X andand WLLWLL inin AfricaAfrica Country Operator Spectrum Status Vendor Coverage Band Algeria Algerie Telecom 1900 MHz July 2004 ZTE 43 provinces in Algeria Angola† Movicel 800 MHz Jan. 2004 Motorola Benguela, Cabinda, Nortel Luanda Egypt Telecom Egypt 800 MHz 2Q 2004 Nortel Coverage Pending Ethiopia ETC 800 MHz, TBA Huawei Addis Ababa 450 MHz Nationwide Kenya Telekom Kenya 450 MHz TBA Huawei Coverage Pending Nigeria Cell Comm. 800 MHz Sep. 2003 TELOS Abuja, Lagos, Ogun Nigeria Intercellular 800 MHz Feb. 2004 Motorola Lagos Nigeria Multi-Links 1900 MHz Mar. 2003 Nortel Lagos Nigeria Reliance 1900 MHz Mar. 2003 Ericsson Nationwide Nigeria Starcomms 1900 MHz July 2003 Ericsson Lagos Huawei Kano Uganda MTN Uganda 800 MHz Nov. 2004 Huawei Coverage Pending Uganda UTL ‡ 450 MHz TBA Huawei Coverage Pending † Mobile. ‡ EV-DO. Source: TMG, Inc. adapted from CDG.

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya 3G3G MilestonesMilestones inin AfricaAfrica

„ 2626 MarchMarch 20032003 •• MultiMulti--LinksLinks [Nigeria][Nigeria] LaunchesLaunches AfricaAfrica’’ss FirstFirst CDMA2000CDMA2000 1X1X WirelessWireless NetworkNetwork „ 2222 SeptemberSeptember 20032003 •• MovicelMovicel (Angola)(Angola) awardsawards 11st mobilemobile 3G3G contractcontract (CDMA2000(CDMA2000 1x)1x) „ AprilApril 20042004 •• ScancomScancom (Ghana)(Ghana) announcesannounces equipmentequipment awardaward forfor EDGEEDGE networknetwork „ 77 JulyJuly 20042004 •• OrascomOrascom TTéélléécomcom AlgAlgéérierie introducesintroduces multimediamultimedia EDGEEDGE mobilemobile servicesservices

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya 3G3G MilestonesMilestones inin AfricaAfrica

„ 1616 SeptemberSeptember 20042004 •• ZTEZTE claimsclaims toto makemake 11st 3G3G callcall inin AfricaAfrica fromfrom ““experimentalexperimental”” WCDMAWCDMA networknetwork inin TunisiaTunisia „ 11 DecemberDecember 20042004 •• EMTELEMTEL (Mauritius)(Mauritius) toto launchlaunch firstfirst 3G3G (WCDMA)(WCDMA) networknetwork inin AfricanAfrican regionregion „ 1919 DecemberDecember 20042004 •• VodacomVodacom (South(South Africa)Africa) launcheslaunches 11st WCDMAWCDMA networknetwork onon continentcontinent

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya 20042004 milestonemilestone yearyear forfor 3G3G inin AfricaAfrica

st „ 11st mobilemobile 3G3G networksnetworks inin AfricaAfrica commerciallycommercially launched:launched:

•• MovicelMovicel (Angola)(Angola) CDMA2000CDMA2000 1x1x •• EmtelEmtel (Mauritius)(Mauritius) WCDMAWCDMA •• VodacomVodacom (South(South Africa)Africa) WCDMAWCDMA

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya MovicelMovicel AngolaAngola –– CDMACDMA 20002000 1X1X

„ Launched: December 2004 „ Initial Phase: roll-out network equipment to provide CDMA voice, data access, SMS, and international roaming to nearly 120,000 subscribers in 32 remote sites in eight Angolan provinces. „ By 2007: operator plans to expand both subscriber capacity and network coverage area resulting in more than 1 million subscribers.

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya EMTELEMTEL MauritiusMauritius -- WCDMAWCDMA

„ Launched: November 2004 – the first African commercial 3G network „ Coverage is island-wide „ Highest level of 3G service: including video phone, video conference, multimedia short message,streaming download. „ Aside from the country’s population, demand for improved mobile services stems from the more than 700,000 international tourists that visit the island each year.

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya VodacomVodacom SouthSouth AfricaAfrica -- WCDMAWCDMA

„ Launched: December 2004 „ Vodacom is Africa’s biggest mobile operator with 12.4 million customers in five countries. „ In South Africa, they have 95% network coverage. „ Initial WCDMA network roll-out to include major metropolitan (Johannesburg, Pretoria, Cape Town and Durban) and selected vacation areas. „ Vodacom is required to take mobile technology into poverty stricken areas. „ Initially offered with PC data cards Vodafone live! for handsets; tariffs the same for voice and video calls as 2G. „ Operator is predicting that 3G services will account for 10% of revenues by 2007, and considering expansion of 3G services to Tanzania and the Democratic Republic of Congo.

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya CERTCERT TunisiaTunisia -- WCDMAWCDMA

„ ExperimentalExperimental networknetwork

„ LaunchLaunch plannedplanned forfor WSISWSIS

„ CoverageCoverage includesincludes TunisTunis andand HammametHammamet

„ VendorsVendors areare AlcatelAlcatel andand HuaweiHuawei

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya EVEV--DODO

„ UgandaUganda TelecomTelecom (450(450 MHz)MHz) underunder deploymentdeployment

„ SouthSouth AfricaAfrica trialtrial testingtesting applicationsapplications suchsuch asas realreal--timetime monitoringmonitoring forfor security,security, traffictraffic cameras,cameras, telemedicinetelemedicine andand distancedistance learninglearning

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya INTRODUCTIONINTRODUCTION TOTO CDMA450CDMA450

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya CDMACDMA 450450 MHzMHz

“Broadly speaking, there are two types of business models to which CDMA450 is particularly well suited. First, it is the most cost effective way of delivering ubiquitous voice services and 3G mobile broadband to markets with large rural areas.”—Lucent

Sub-Saharan Africa: > 60% rural

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya IntroductionIntroduction toto CDMA450CDMA450

ƒ CDMA450CDMA450 isis thethe commoncommon namename forfor CDMA2000CDMA2000 deploymentsdeployments inin thethe 400400 MHzMHz bandband ƒ CDMA450CDMA450 isis aa membermember ofof thethe IMTIMT--20002000 familyfamily ofof standardsstandards (3G)(3G) asas partpart ofof thethe ITUITU--RR RecommendationRecommendation M.1457M.1457 ƒ BandBand classclass 55 ofof thethe IMTIMT--20002000 standardstandard includesincludes 411411--493493 MHzMHz bandband ƒ CanCan bebe usedused forfor bothboth mobilemobile andand WLLWLL applicationsapplications

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya DevelopmentDevelopment ofof CDMA450CDMA450 inin thethe WorldWorld

ƒ KeyKey driverdriver forfor CDMA450CDMA450 waswas thatthat NMTNMT operatorsoperators werewere facedfaced withwith nono digitaldigital technologytechnology optionsoptions forfor migrationmigration

ƒ CDMA450CDMA450 waswas developeddeveloped inin responseresponse toto meetmeet thethe needneed ofof NMT450NMT450 operatorsoperators

ƒ CDMA2000CDMA2000 isis oneone ofof thethe fewfew IMTIMT--20002000 (or(or 3G3G technologies)technologies) thatthat fitsfits intointo lessless thanthan 55 MHzMHz ofof spectrumspectrum soso itit alignsaligns wellwell withwith NMTNMT spectrumspectrum allocationallocation

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya DevelopmentDevelopment ofof CDMA450CDMA450 inin thethe WorldWorld

ƒ OverOver 7070 NMTNMT operatorsoperators inin EuropeEurope andand 6363 NMTNMT operatorsoperators inin Russia,Russia, thethe CIS,CIS, andand AsiaAsia werewere interestedinterested inin thethe businessbusiness casecase forfor advancedadvanced wirelesswireless servicesservices withwith CDMA450,CDMA450, thusthus creatingcreating economieseconomies ofof scalescale ƒ NMTNMT operatorsoperators havehave overwhelminglyoverwhelmingly chosenchosen CDMA450CDMA450 asas theirtheir choicechoice ofof inin-- bandband migrationmigration toto IMTIMT--20002000 ƒ RussiaRussia hashas recognizedrecognized CDMA450CDMA450 asas aa nationalnational standardstandard

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya CDMA450CDMA450 TECHNOLOGYTECHNOLOGY -- ADVANTAGESADVANTAGES

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya CDMA450CDMA450 –– AdvantagesAdvantages

ƒ BringsBrings advancedadvanced wirelesswireless serviceservice toto areasareas previouslypreviously underservedunderserved oror unservedunserved

ƒ AA costcost--effectiveeffective solutionsolution forfor countriescountries workingworking toto achieveachieve universaluniversal serviceservice goalsgoals

ƒ MultipleMultiple applicationsapplications,, including:including: defense,defense, publicpublic safety,safety, security,security, education,education, health,health, smallsmall andand mediummedium--sizedsized companiescompanies

ƒ ProvidesProvides aa clearclear migrationmigration pathpath forfor NMT450NMT450 operatorsoperators currentlycurrently orphanedorphaned atat 1G1G

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya CDMA450CDMA450 CASECASE STUDIES:STUDIES: BrazilBrazil andand thethe CzechCzech RepublicRepublic

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya ProvidingProviding ExtendedExtended CoverageCoverage UsingUsing CDMA450CDMA450

ƒ CDMA2000 in countries such as Australia, Russia, Brazil, China and India has proven to be an effective technology to provide vast coverage benefits to rural areas.

ƒ Lower bands (such as 800 MHz and 450 MHz) are ideal for covering vast areas because: • Large areas are otherwise difficult to reach using fiber and copper. • Favorable propagation characteristics of lower frequencies grant significant cost advantages. Because lower bands propagate further, they require less infrastructure equipment and cover a greater distance. 1. http://www.telstra.com.au/mobile/business/products/mobilebroadband.htm?tR=3m

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya Providing Extended Coverage Using CDMA450 CDMA2000 1xEV-DO at 450 MHz: Brazil

Partnership between Lucent and Anatel (Brazilian telecom regulator) to demonstrate CDMA2000 1xEV-DO broadband data capabilities and coverage at lower frequencies for universal broadband access.

Bus visited government agencies and rural public schools to provide broadband access. Such a model is expected to be replicated widely and provide high speed Internet access cost effectively over great distances.

Broadband data coverage, distance from the base station: •45 Km Outdoor – 800 Kbps Peak Speed (with External Antenna) •17 Km Indoor – 800 Kbps Peak Speed (with no External Antenna)

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya CDMA2000 1xEV-DO at 450 MHz: Brazil

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya CDMA2000 1xEV-DO at 450 MHz: Brazil

**See online video in English, Spanish, and Portuguese : http://projetoscd.isat.com.br

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya HighHigh SpeedSpeed DataData ServicesServices UsingUsing CDMA450CDMA450 EVEV--DODO service:service: CzechCzech RepublicRepublic

ƒ World’s first 450 MHz CDMA EV-DO service launched in 2004 by Eurotel, Czech Republic mobile operator ƒ Eurotel, fully owned by Czech Telecom ƒ Services provided include: • NMT 450MHz mobile • GSM mobile • WiFi • GPRS/EDGE • CDMA 2000 EV-DO ƒ UMTS (WCDMA) license; to launch before January 2006 ƒ ADSL (Provided by Czech Telecom)

Full suite of wired and wireless Internet access services! CDMA EV-DO provided by GSM operator!

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya HighHigh SpeedSpeed DataData ServicesServices UsingUsing CDMA450CDMA450 EVEV--DODO service:service: CzechCzech RepublicRepublic

ƒ The original 450 MHz operating license was granted for a period of twenty years from the signing of the agreement for the 450 MHz license in 1991.

ƒ In 2002, Eurotel renewed its 450 MHz license; the current license enables Eurotel to offer any internationally recognized public mobile telecommunication services on a frequency of 450 MHz. The license is currently valid for the remaining period of eight years.

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya HighHigh SpeedSpeed DataData ServicesServices UsingUsing CDMA450CDMA450 EVEV--DODO service:service: CzechCzech RepublicRepublic

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya WirelessWireless TechnologiesTechnologies andand thethe DigitalDigital DivideDivide inin AfricaAfrica

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya AccessibilityAccessibility

„ Mobile wireless subscribers grew by over 1,000% during the 1998 – 2003 period.

„ Mobile infrastructure has extended beyond that of fixed-line into rural and “universal access” markets. • Still, only an estimated 50% of Sub-Saharan Africa is covered by a mobile signal • And mobile penetration varies greatly from one country to another – ranging from 1% in Ethiopia to almost 75% in Réunion (end of 2003).

Source: The Economist, 2005

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya AffordabilityAffordability

„ Prepaid services have become key in a region that has low per capita income and where payment in cash is the preferred option.

„ It is estimated that four out of every five African subscribers – almost twice the global average – use pre- paid services.

„ More and more African networks are preferring to operate only as pre-paid.

„ Easy payment options have allowed mobile services to extend to segments, of both urban and rural populations, that could not afford them – and where demand is high.

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya EntrepreneurshipEntrepreneurship andand JobJob OpportunitiesOpportunities

„ Vendors selling air time on rental phones, vendors selling prepaid cards, Nigeria’s relayers/receivers of Umbrella text messages, and/or People vendors of phone accessories are but a few examples of how wireless technologies are encouraging entrepreneurship and the creation of jobs in many African countries. Source: Nigerian Communications Commission, 2004

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya EntrepreneurshipEntrepreneurship andand JobJob OpportunitiesOpportunities

• Mobile Phones and Small Businesses „ Almost 85% of businesses surveyed in Egypt and 89% of businesses surveyed in South Africa indicated usage of a mobile phone. • Mobile phones had overtaken fixed line ones as the most important communication tool for businesses that were surveyed. „ More than 85% of small businesses (run by black people) surveyed in South Africa depend solely on mobile phones for telecommunications „ Approximately 62% of businesses in South Africa, and 59% in Egypt, indicated mobile use was linked to an increase in profits – in spite of the higher cost of calls. „ In addition, businesses surveyed indicated an increase in profits, reduced travel and increase in efficiency.

source: Africa: The Impact of Mobile Phones”acked by Vodafone and the Center for Economic Policy Research

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya EntrepreneurshipEntrepreneurship andand JobJob OpportunitiesOpportunities

• Mobile Phones and Communities „ In Tanzania, of those people surveyed, 97% said they could access a mobile phone, while just 28% said they could access a land line phone. „ The higher proportion of users as opposed to owners in Tanzania suggested a greater degree of ‘sharing’ of mobiles than in South Africa. „ 50% of the respondents - who were mobile users - were within the lowest monthly income bracket (approximately $85-$170 per month). „ In South Africa, communities with and without electricity owned and used mobile phones equally. „ In Tanzania, 57% of respondents, considered that mobile phones were key in facilitating faster and improved communication. In South Africa, respondents considered mobile phones an important tool for job searching.

source: Africa: The Impact of Mobile Phones”acked by Vodafone and the Center for Economic Policy Research

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya AppropriateAppropriate RegulatoryRegulatory FrameworkFramework

„ Aside from liberalization and competition, one regulatory measure which can particularly contribute to improving communication and reducing the digital divide is roll-out requirements in mobile licenses.

• South Africa: in 1996, incumbent operator Telkom had specific roll-out targets, including 2.7 million new lines (1.7 million in under-served areas) and 120,000 community pay phones. Now, all operators must deploy community pay phones. • Uganda: Major operators are required to attend to rural communication development which, aside from providing voice telephony in those sub-counties they service, includes providing one public access phone per 5,000 inhabitants by 2005.

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya InIn ConclusionConclusion……

„ WithWith aa populationpopulation ofof overover 800800 millionmillion peoplepeople andand moremore thanthan 5050 millionmillion mobilemobile phonephone usersusers atat present,present, roomroom forfor growthgrowth andand opportunityopportunity isis vast.vast. „ FurtherFurther liberalizationliberalization andand moremore competitioncompetition shouldshould continuecontinue toto bebe encouraged,encouraged, asas shouldshould thethe establishmentestablishment ofof regulatoryregulatory frameworksframeworks thatthat fosterfoster accessibilityaccessibility forfor all.all.

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya InIn ConclusionConclusion……

„ InnovativenessInnovativeness shouldshould bebe encouragedencouraged andand supported.supported.

„ Also,Also, despitedespite thethe higherhigher costcost ofof callscalls onon mobilemobile phonesphones (in(in comparisoncomparison toto costcost ofof callscalls ofof fixedfixed phones),phones), mobilemobile phonephone usageusage hashas continuedcontinued toto growgrow……imagineimagine whatwhat thethe growthgrowth inin thethe usageusage raterate wouldwould bebe ifif pricesprices werewere closercloser toto cost.cost.

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya InIn ConclusionConclusion……

„ In sum, wireless technologies – such as CDMA450 – can provide a way to offer affordable communications to a greater number of people thus helping to foster the decrease of the digital divide.

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya “Rather than trying to close the divide for the sake of it, the more sensible goal is to determine how best to use technology to promote bottom-up development. And the answer to that question turns out to be remarkably clear: by promoting the spread not of PCs and the internet, but of mobile phones.” – The Economist, March 2005

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya THANKTHANK YOU!YOU!

SofieSofie MaddensMaddens SeniorSenior RegulatoryRegulatory andand PolicyPolicy AdviserAdviser TelecommunicationsTelecommunications ManagementManagement Group,Group, Inc.Inc. 16001600 WilsonWilson Blvd.,Blvd., SuiteSuite 710710 Arlington,Arlington, VirginiaVirginia 2220922209 Tel:Tel: +1+1--703703--224224--15011501 Fax:Fax: +1+1--703703--224224--15111511 www.tmgtelecom.comwww.tmgtelecom.com

Sofie Maddens Executive Seminar on CDMA450 May 14, 2005 Nairobi, Kenya