Tuesday, August 19, 2008

Telecom Companies Raise Questions Over Access to Fibre Backbone in Rwanda

Recently, the digging started on Rwanda's new fibre optic network. Local telecom companies want their piece of the ICT pie. Rwanda is getting wired. By the end of next year, the government's new 2,000 kilometer fibre optic network should increase broadband access to the country, linking all districts to high quality voice, data, and video services, according to officials.

MTN Rwandacell is interested in using the new network but the company's chief operating officer says there are a few conditions.

"It would be wonderful if the government was a facilitator," says Andrew Rugege. "When the government says 'OK, we'll help you to put this investment in place, and you can utilize it,' they're putting the money up front, we're putting investment in other places in Rwanda, and it's a win-win situation."

Taking fiber infrastructure up to the district level is a positive move, Rugege says, since it would provide access to rural areas that are not otherwise economically viable. "That is a good plan. What is not a good plan is to put that in place and deny access to the business people," he says. "I hope they have no plans to do that."

Minister of ICT Romain Murenzi, who is overseeing the project, says the government will make ownership and usage decisions once the fiber is established. According to him, the government may eventually lease out the fiber, sell it completely, or use it themselves. "These are all possibilities," Murenzi says.

But MTN says limiting the fiber to government use would be unfair. "You shouldn't sink your investors," Rugege says. "We do our business cases based on the market, and a big part of this market is the government. If you take out the government, it becomes a difficult proposition," he says.

MTN may not have made the same investment decisions, had it been aware of the government's plans, Rugege says. "We as investors have put money, and are still putting money, into infrastructure," he says, referring to the US $3 million the company spent this year on its own fiber optic ring around Kigali.

Rwandatel, too, has invested in the new technology, and says that its best case scenario would be to continue along that path. "We've had our fiber network for a while-we know how to manage it," says Victor Kinuma, Marketing Manager.

With a third telecom operator soon to join the duopoly, though, things could get messy, Kinuma says-especially if the new guy builds his own network, too. "It's a little tricky because you'd be having three fiber cables going in the same direction from three different companies," Kinuma says.

For now, Rwandatel says, it will just keep building its own fiber backbone and giving customers as much access as possible. As for MTN, the company says it has no plans to pull out of a newly-signed 15-year service contract with the government-nor is the telecom mogul at risk of going under. "There is no question that we'll survive," the chief operating officer says. "It's just a matter of keeping a fair playing ground."

(Source: Focus Media)