From Choice Magazine, Dec 2003 (
http://www.undp.org/dpa/choices/2003/december/ict.html)
Private Competition Drives Down Telephone and Internet Costs in Somalia: But chaotic situation highlights need for self regulation
Hargeisa—Two main features interrupt the dusty horizon of Hargeisa, the windblown desert capital of the self-declared, but as yet unrecognized, Republic of Somaliland. The first has always been there, a set of identical twin mountains, but now there is another —competing satellite towers mounted high on the spiny brown ridges overlooking town—that also pierce the low-slung skyline and stand testament to the city’s more recent history.
Over the past five years, Somalis have outpaced their neighbours in East African countries in developing their information and communications technology. With a steadily increasing number of mobile phone, fixed-line and Internet service providers, Somalis have turned to technology to fill an infrastructure vacuum in this nation struggling to rebuild itself after a decade of civil war. While there is no official banking system or postal service, and while many Somalis don’t have regular running water or electricity, most do have access to fixed phone lines. Many others own mobile phones while colourful Internet cafés are springing up along Hargeisa’s bustling downtown streets.
“In traditional African societies, it’s sometimes difficult for government officials to embrace technology, but here, it is the people who decide,” says Abdi Karim Mohamed Eid, manager of Telesom, a private telecommunications company.
A decade ago, Somaliland had a single phone company providing fixed lines only. There are now four private telecommunications companies—with a fifth scheduled to have entered the market by the end of 2003—and a growing number of Internet users.
“We started with a few hundred subscribers and now we have about 3,000,” says Mr. Eid. “If you add up the other companies, there may be around 20,000 Internet subscribers in Somaliland. That’s much more than we anticipated initially and it’s a remarkable achievement given that there is no backing from the international community. This is solely done by the Somali business community. We are really proud of that.”
In all of Somalia, there are nine companies providing service today through over 105,000 fixed lines and almost 39,000 mobile lines. In 1993, 33 years after independence, there were only 17,000 telephone lines, 14,000 of which were in the capital Mogadishu. Almost 87 percent of the country now has telephone service.
Fierce competition keeps cost down
In Somaliland, fierce competition between the private companies has driven consumer costs down, despite the fact that companies must rely on expensive satellite technology rather than fibre-optic cables. International calls on mobile phones cost US$1 per minute or less, five or six times lower than in most African countries. The lack of a government has also helped keep costs down—there is no tax on telephones.
But the lack of regulation has also created a chaotic situation, where callers subscribing to one company are often unable to talk to people who subscribe to another system. As a result, UNDP, which had been working to promote private enterprise in the region, together with the International Telecommunications Union, invited the leaders of the private companies to a series of meetings in Dubai, where the companies formed the Somali Telecom Association in late 1998.
“It was like a game without a referee,” says Abdilghani Jama, Secretary General of the Somali Telecom Association. “Then UNDP and ITU brought all the operators together in Dubai and said, ‘we would like to help you but you have to have one office.’ ”
Since its formation, the Association has been headquartered in Dubai, to allay any fears of favouritism to any region or operator. It is a voluntary organization, and has emerged as the main telecommunications focal point, representing Somali interests at global conferences.
The lack of connections between the various companies grew out of a lack of trust, according to Mr. Jama. In a pilot project to unify the telephone system in Mogadishu, the Telecom Association brought the local operators together to meet with international experts on the costs and benefits of interconnectivity. As a result, the companies contributed to the purchase of new equipment and the formation of a jointly owned company, and now telephone users in Mogadishu can talk to each other.
“Rebuilding trust wasn’t easy,” says Mr. Jama. “But now we are trying to replicate the Mogadishu model in other areas.”
Somaliland is still waiting for the private companies to connect with one another. “Every company runs its own business, we’re not connected to each other. If you want to call someone with another company, you have to subscribe to that network,” says Abdul Aziz, a network administrator for Telesom. “But we’re trying to work that out so it’s all one unified system.”
In the meantime, approximately three million people living in Somaliland, about 500,000 of them in Hargeisa, will have to make do with what they’ve got. “There’s still a lot of work to be done, but what we’ve already done is quite an achievement,” says Telesom’s Mr. Eid. “The benefits that the Internet has brought are tremendous.”
Service improvements in Hargeisa
Telesom is aiming to introduce a roaming mobile phone system by early 2004 to allow mobile phone owners from other countries to use their GSM phones—phones that operate according to a global wireless communications standard—while in Somaliland.
By the end of 2003, Telesom also expects to have introduced text and voicemail systems to their network.
Pre-paid cards allow companies to collect money in places where steady incomes, fixed addresses, credit checks, reliable banking and postal systems don’t exist. Somaliland still needs fixed lines for families who cannot afford more than the monthly $10 fixed line fee. As a result, the city is wreathed in coils of chaotic telephone cables snaking along roadsides and tangling in overhead spaces.
Hargeisa’s private telecommunications companies say they can usually install fixed lines within two days of receiving an application and Internet accounts can be up and running within 24 hours.
Various businesses, especially shipping agencies, have benefited from having Internet access, while money transfer companies are creating their own software packages. A small number of students have also been using the Internet for e-learning through universities overseas.
UNDP, with technical assistance from the Centre for Tele-Information, Technical University of Denmark, is also supporting efforts to bring broadband access to universities and government installations in Somaliland. In 2002, a Very Small Aperture Terminal, or VSAT system, was installed in the UNDP compound in Hargeisa, with nodes of connection to the Ministries of Planning, Finance, Foreign Affairs, the Vice Presidency and the University of Hargeisa. The project aims to provide Internet access to educational institutions and government ministries to supplement initiatives already undertaken by the private sector.
“The benefits of ICT are endless,” UNDP Somalia Resident Representative Max Gaylard says. “ICT gives the citizens of a nation access to the world and vice versa. The flow of information and ideas allows Somalis to communicate with each other and with people around the world, but more importantly, it is key to informed decision-making in matters which affect them.”
At Micro Computer Services, an Internet and computer training school, there is a month-long waiting list for 50 spaces. “The computer has become the most important tool for employment these days, especially with e-mail. Everybody needs to use a computer and everyone wants to learn how to use it,” says the school’s manager, adding that the ICT explosion in Somaliland has created job opportunities for those skilled enough to install and repair networks or work in Internet cafes.
“The development of our country relies on information technology, whether it’s for health or education. The government is fully aware of that,” says Abdullah Duale, Information Minister for Somaliland’s de facto government. “The more we inform our people and the more access they have to information, the better off we will be.” n
—Finbarr O’Reilly is a Canadian journalist who reports extensively from Africa.
Somalia at a Glance
Population: 9,088,000
Area: 637,657 sq km
No. of telephone mainlines per 1,000 people: 2
No. of cellular subscribers per 1,000 people: 0
Daily newspapers per 1,000 people: 1
Radios per 1,000 people: 60
Television sets per 1,000 people: 14
Sources: Human Development Report 2003, UNDP Global ICT for Development Factbook, World