Malawi’s incumbent operator, Malawi Telecommunications, is seeking local and international telecom companies interested in partnering to operate its nationwide fiber-optic backbone network The operator said they will prefer proposals from private players. Sources in the company said they look for private sector players to express interest in the prospective co-ownership of the network to provide a robust infrastructure to facilitate telecom services in Malawi.
The Fiber system is the only network that links Malawi to the East African Submarine Cable System (EASSy), through Tanzania in East Africa and Mozambique in Southern Africa. EASSy is a 10,000km submarine fiber-optic cable system deployed along the east and south coast of Africa to service the voice, data, video and internet needs of the region. It links South Africa with Sudan via landing points in Mozambique, Madagascar, Comoros, Tanzania, Kenya, Somalia and Djibouti. The cable incorporates the latest developments in submarine fiber-optic technology, making it economical to connect the eastern and southern coast of Africa into the high-speed global telecommunications network. The system is owned and operated by a group of 16 African (92%) and international (8%) telecommunications operators and service providers.
The company said it is seeking a suitable joint-venture partner to enable it to effectively utilize the capacity of the current network and develop a commercially successful fiber-optic system for the country.
As in many other countries in Africa, the Malawian government and its partners in the company have failed to provide enough funds to effectively run the company in order to meet the growing demand for broadband services. Malawi’s internet sector is reasonably competitive with at least 22 licensed ISPs, compared to just two mobile phone operators currently operating in the country.
However, the high cost of bandwidth has held back further growth in the Internet sector and has kept broadband access prices among the highest in the region. Malawi Telecommunications CEO Harry Gombachika said the company wants to involve partners to offer services to other telecom players as a “carrier of carriers” and fuel ICT development in the country.
The CEO said a special purpose vehicle (SPV) will be established so the government can operate at arms-length from Malawi Telecommunications and the partners. He said in an advertisement in the national newspapers that the SPV will be a separate entity from Malawi Telecommunications and the partners.
Gombachika said Malawi Telecommunications and other operators will have shares of equity in the SPV, to be determined through a process of negotiations after establishing the value of the entity.
The growth potential of the telecom sector remains strong as consumers continue migrating from fixed telephony to mobile telephony using alternative communication solutions such as messaging, emails and social media due to the widespread diffusion of smartphones and tablets.