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EA has to wait longer for Seacom, Teams cables

Saturday June 27 2009
Fibre-optic

Engineers at the ceremony to mark the arrival of the Teams fibre optic marine cables in Mombasa at the Fort Jesus sea front. East Africa will have to wait a little longer to be connected to the global broadband network. Picture: Gideon Maundu

East Africa will have to wait a little longer to be connected to the global broadband network due to pirate attacks off the Horn of Africa and Somalia that have delayed the laying of the undersea cable there.

The connection to the global broadband network was supposed to have taken place by the end of this month but on Wednesday the managers of Seacom, a $600 million project owned by private investors, said that its cable would not come into service until July 23 – nearly a month later than planned – due to piracy off the coast of Somalia that had delayed the work of its cable-laying contractor.

Tyco Telecommunications, the contractor, was at one point forced to suspend its cable-laying around the Horn of Africa so it could revise its security arrangements following the latest surge in piracy, the Financial Times reported.

Piracy from Somalia has been on the rise since last August, but last week’s announcement from Seacom marked the first time the pirates have disrupted efforts to end the region’s dependence on satellite Internet links, which are slow, unreliable and often prohibitively expensive.

While cable-laying ships have not been attacked so far, they are huge – needing to carry up to 6,000km of fibre optic cable – and vulnerable to pirate attack because they move slowly.

“Cable-laying ships would be prime targets,” said Pottengal Mukundan, director of the International Maritime Bureau in London. “They’re very slow when they’re laying the cables and they really can’t get away.”

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The delay had not been announced until the job was finished to avoid putting the ships in further danger.

The Seacom cable will link South Africa, Mozambique, Madagascar, Tanzania, Kenya and Ethiopia to India and Europe. A separate project led by the Kenyan government — the East African Marine System — will connect Kenya to the United Arab Emirates.

Meanwhile, the recent commissioning of the $110 million East African Marine System cable by President Mwai Kibaki in Mombasa has brought to the fore the battles the government-led outfit is willing to engage its main rival, Seacom — a privately-owned fibre optic cable services operator.

Apparently, the East African Marine System (Teams) ship had docked at Mombasa port to complete the final stage.

Seacom pulled a similar stunt two months ago when its ship docked in Mombasa, sending the media into a frenzy: That the first-ever under sea cable had landed on the East African coast.

The ship, which had come from South Africa was part of a three-ship crew laying the $760 million cable that will eventually connect the East African region with India and Europe.

This is all hype and no action,according to industry insiders.

It is naive to expect a ship that started laying the cable slightly over a month ago in Fujaira, United Arabs Emirates, 5,000 kilometers away, to complete the work in a few days time, observed Ng’ang’a Waruinge, an IT consultant with Wired TeleKom.

Notwithstanding the rerouting of the cable by an extra 200 kilometres from the coastline for fear of pirates off the Somalia coast.

The first cable is expected to considerably bring down the cost of data. Currently, East Africa is the only region in the world with neither intra-African nor direct access to worldwide international cable networks and instead relies on expensive satellite communication.

Thus, that data costs are among the highest in the world with costs of up $5.000-$7.000 per megabit of bandwidth.

The price is expected to be slashed by as much as 80 per cent.

Unperturbed, the Teams project surveyor, Messel Ole Penmarto said the vessel has already covered 4,700 kilometres and the remaining 300 kilometres will be completed in a week’s time.

Information and Communications Permanent Secretary, Dr Bitange Ndemo was more semantic: “Testing is now underway and it will take another 30-60 days before we go live. However, one would be able to access data by next week, ” he told the EastAfrican.

According to Mr Waruinge, the earliest Kenyans can access data from the cables is late this year.

In the meantime, both projects have issues that needs thrashing before they become operational. Ownership structure and their business models are their main impediment.

Currently Teams is dogged by the hiccup of shareholding. Apparently some investors — the smaller ones — are yet to take up their shares, despite the expiry of the deadline (June 10).

This now means delays as the interested parties are most likely to seek legal redress, which might a long time to settle. There is also the process of competitive bidding in the identification new shareholders.

Shared ownership has also raised concerns over how the government’s promise to deliver affordable bandwidth will be achieved. All the 80 per cent owners of the government stake in Teams are in private sector.

The Kenya government owns 85 per cent of the Teams cable, while the United Arab Emirate’s Etisalat owns the other 5 percent.

Out of the government stake, 80 per cent is held by the private sector, with ownership divided between Safaricom (20 per cent), Telkom Kenya (20 per cent), KDN (20 per cent).

Investors with minority shareholding include, Access Kenya, Inhand Ltd, Equip Ltd, Flashcom and Fibrenet Africa all with a 1.25 per cent stake.

Etsalat is also involved the laying of cable through its affiliate, E Marine ( sub-contracted by Alcatel, the main contractor. O&M, another affiliate providing interconnection.

Asks Mr Waruinge: “Were these contracts procured on an arms-length basis and in accordance with the Public Procurement Rules?

How is the interest of the Kenyan public safeguarded. Suppose somebody went to court to seek clarification?”

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