Tanzanian firm lays fibre optic cable

A Tanzania telecommunications firm, SimbaNet has won a $20 million [K8 billion] World Bank-funded Regional Communication Infrastructure Programme Malawi (RCIPMW) contract, to construct a region fibre optic cable under the Public Private Partnership (PPP) arrangement.

Six firms had prequalified for the contract, which included, China International Telecommunication Construction Corporation (CITCC),GPEC Inc in joint ventire with SK Telecom from USA and South Korea,Malawi Virtual Landing Point (MVLP) joint venture consortium from South Africa, SimbaNet Tanzania Limited in association with Airtel Bharti registered in Tanzania and Singapore respectively, SK Broadband from South Korea and Soliton Telmec Limited registered in Kenya.

Under the arrangement, SimbaNet which also operates in Kenya and Uganda offering triple play (telephony, Internet and Protocol Television (IPTV)) to international leased circuits to data warehousing, will lay an underground cable from Lilongwe to the Tanzanian border.

The cable will connect to the under-sea cable to increase broadband penetration, effectively reducing Internet charges.

“At the end of the project, broadband penetration is expected to significantly increase thereby improving economy wide productivity. It is also expected that the availability of affordable international connectivity will cause the development of new services and business models including spurring business process outsourcing sub-sector,” said Jimmy Lipunga, chief executive officer of Public Private Partnership Commission (PPPC) in a statement.

Combined, these outcomes, he said would make a meaningful contribution towards the gross domestic product (GDP), the broadest measure of the country’s overall economic development.

The award of the contract to SimbaNet was through a competitive bidding in which the Malawi Government was seeking a private sector investment in fibre optic connectivity through Tanzania and the establishment of a virtual landing point in Malawi.

SimbaNet is owned by SimbaNet Holdings Limited, controlled by Wananchi Holdings Limited which has a 65 percent stake with the balance, 35 percent, owned by Ali Mufuruki.

Lipunga said the telecoms company complied with the requirements of the tender, and these include an 18-month implementation timeline, fixed capacity of STM-64 (620 megabytes per second), route redundancy for 50 percent of the capacity, one unit (loose) dark fibre pair and virtual private network (VPN) capabilities.

“They have also complied with tender requirements dog drop off poonts, virtual landing point specifications,” he said.

The company has proposed Internet service charges of $200 per megabyte per second per month from a high ranging between $700 and $1 550 per month.

The proposed prices are 90 percent lower than what is currently the case on the market.

“The introduction of a new low price entrant will drive price competition to the benefit of consumers in the market with expected effect of improving national Internet penetration,” said Lipunga.

In all this, government will be purchasing the capacity from the investor for use in schools and public health institutions, among others.