Calls from Somali mobile providers are generally cheaper and clearer than calls from elsewhere in Africa. Could lack of regulation being working in Somalia’s favour?
Somalia has had no government since 1991. Its communications network was cut off for some time, but then private mobile operators rolled out service and discovered that a collapsed state provided a competitive advantage.
No government meant no state-owned incumbent to worry about, no corrupt ministry officials to pay off and the freedom to choose the best-value equipment. Taxes, payable to a tentative local authority are seldom more than 5%, security is another 5% (more in Mogadishu), and customs duties are next to nothing. There is no need to pay for licenses or to put up masts.
Golis Telecom is one of the larger operators in the Somali market. Its chair, Adan Sheikhdon Ali, hopes for 50,000 mobile subscribers by 2007. Golis spent US$ 2.7 million on Chinese equipment to set up its service and has since expanded its reach across the country, drawing customers with low prices. You can call anywhere on the planet on a Golis mobile for US$ 0.30 per minute.
The present dozen or so operators should eventually be whittled down. To survive, Golis has diversified into landlines and broadband. However, even with price wars, profits are high. Somalis' gift of the gab, and the difficulty of getting in and out of the country, put a premium on extended telephone calls. Golis recouped its initial investment in two years. However, the risks of doing business in Somalia are also high.
Source: The Economist - WDR/Intelecon Regulatory News |