State Gets Itself Into a Dead End in the Transition to 4G ' Granting a 3G Monopoly Is Not the Answer to the Question

London — Cameroon's approach to increasing mobile data speeds for its citizens is wrong-headed and will lead it into a time-consuming dead-end. Cheap mobile data prices come from competition between operators, not from giving a single operator a monopoly. Russell Southwood looks at what's happening and remembers that Cameroon has previous form of this kind in the regulatory field.

Cameroon offered Viettel a mobile operator concession with a year's monopoly on the operation of 3G. Viettel is no ordinary mobile operator as it is owned by the Vietnamese Government and operated by its Ministry of Defence.

Readers with good memories will remember that we wrote about the wholesale network and landing station monopoly (in issue 688 ) enjoyed by the incumbent telco Camtel which has ensured that the country has amongst the highest international and national network prices on the continent. The Government and regulator have moved in lock-step to prevent others from entering the market.

In mid April the Cameroonian weekly Insights reported that Viettel had sent a letter to the President about its monopoly. The period of the monopoly started from the signature on its concession and will end in December 2014. Viettel has thus far failed to launch (having twice postponed) and wants the monopoly to run from the date of its launch, which the report says would push the date out to 2016.

The granting of a monopoly in the first place would not have ensured a competitive market with fairer prices and higher quality. But to push out the monopoly to the end of 2016 has a number of disastrous consequences for the development of the country's mobile data market and by extension the development of the country itself.

Whilst Viettel has a 3G monopoly, the two other mobile operators ' MTN and Orange ' will be unable to implement 3G, which both could do fairly quickly. MTN has indicated that it will invest CFA 600 billion in the country if granted a 3G licence. They have already indicated that not surprisingly, they are unhappy with the data monopoly as it gives a competitor an unfair advantage in this new market.

However worse still, it means that a complete implementation of 3G by all operators will not happen until 2017 on the basis of the deadline suggested. This will have the knock-on effect of placing Cameroon at the back end of the queue for implementing LTE. All operators will want to get a return on their 3G investment which means that LTE may not be considered until 2019 or 2020.

Further complications are added to this already messy picture by the fact that both of the mobile operators that already running operations have licences that expire shortly: Orange in July 2014 and MTN in February 2015. And whilst all of this is going on, none of the independent ISP operators in the country will be allowed anywhere near 4G/LTE spectrum of the kind that has been made available to them in more competitive African countries like Nigeria, Tanzania and Uganda.

Logically, it would make much better sense to leapfrog straight to LTE but logic has not been Cameroon's strong point. So it is now stuck in a dead end that will ensure it has little or no chance of catching up with those faster moving African countries (already implementing 4G) until the end of the decade.

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