Bring the dollars back to Africa

Africa is the only continent that has to go outside for international connections between its countries, leading to an outflow of profits into the hands of global telecommunications operators, says Peter Gbedemah, CEO of Gateway Communications.

Speaking at the GSM Africa conference last week, Gbedemah said: "It is crazy. For instance, if a person in Lagos, Nigeria, wants to connect with the Ghanaian capital of Accra, the link has to go via Europe. This is the only continent where this happens."

Gbedemah said this situation arose for historical and economic reasons, leading to Francophone countries generally routing their calls through Paris, and the English-speaking countries through London.

"International telecoms operators just set up the link and they get the profit from aggregating the call minutes through their international centres that are set up outside of Africa."

Gbedemah said while national telecommunications operators in Africa have profited from the termination fees paid to them by the global operators, they are still missing out.

"Most calls to African destinations are inbound from locations outside the continent. African telecoms operators have received some profits from this. However, there is a change and more calls are outbound now and if we can do our own interconnection, then the operators will be able to claim profit from a larger amount due to call initiation costs."

The creation of the East African Submarine Cable System (Eassy) and its complementary land component would be part of solving the interconnection issue for Africa, said Gbedemah.

He also wants to see increased dialogue between governments and business that would encourage the formation of an African interconnection hub.

"We have made representations to various governments and people. We want to get involved in infrastructure development," Gbedemah added.

Also at the GSM Africa conference, Gateway Communications announced it will become the first African satellite connectivity provider to integrate its network with the home and visitor location registers (HLR and VLR) of its customers.

HLR is a central database that contains details of each mobile phone subscriber that is authorised to use the network, while the VLR handles requests for mobile phones to attach to the network, it said.

Working together, the two services enable a mobile handset to be located by the satellite network operator at any time, it explained.

Gbedemah said both operators and phone users gain huge benefits from more efficient routing, providing cost savings and higher quality calls.

Gateway is now able to direct a call to the nearest of the more than 350 mobile switching centres that it connects with, he said. This makes additional satellite "hops" unnecessary, resulting in lower capacity costs, greatly improved quality of calls, and more efficient network utilisation due to the lower requirement for bandwidth.

Michael Silber from Michalson Attorneys noted that HLR and VLR are a great step forward for Africa. Unfortunately, it may be irrelevant in SA, as the three mobile operators provide largely fibre links, with little satellite connectivity being used, he added.