Cluster III. Good governance: where the strategy aims at developing structures and systems of democratic governance that are participatory, representative, accountable and inclusive and
2.3 Telecommunication sector reforms
2.3.1 Status of ICT services in Tanzania
According to (TCRA 2007a), by March 2007 the status of ICT services in Tanzania was:
2.3.1.1 Telephone
About 6.3 millions Tanzanians owned voice telephone lines. The mobile voice telecommunication leads the market by having more subscribers (6.2 millions), compared to fixed-line services (0.14 million). The market share of different telephone operators in Tanzania shows that Vodacom is leading the market in terms of number of subscribers, with about half (51%) of all voice telephone subscribers in the country. Celtel ranks second, with 26% of subscribers, followed by Tigo (13%), Zantel (7%) and TTCL- Fixed (3%).
2.3.1.2 Fixed telephony
The Tanzanian incumbent fixed-line operator, Tanzania Telecommunication Company Limited (TTCL), was partially privatised in 2001 (Mwandosya 2001, TCRA 2005). This was followed by the extension of its monopoly for a further four years, through what was termed the exclusivity period6.
TTCL exclusivity ended in February 2005 (TCRA 2005). The Tanzanian fixed telephone market is currently fully liberalised and has two operators, TTCL and ZANTEL. The introduction of competition in the fixed-lines telephones is expected to increase quality and lower the price of this service.
The network infrastructure for fixed telephones is at present, limited to urban areas. Lack of telecommunication infrastructure in rural areas remains a basic impediment to the provision of ICT services, such as the internet, in rural areas of Tanzania (Nnafie 2002; URT 2003a).
2.3.1.3 Mobile telephone
The mobile telecommunication market in Tanzania is fully liberalised. There are four licenced land cellular mobile telephone companies in Tanzania. These are Vodacom, MIC Tanzania Ltd
6Following the global trend in telecommunication sector reform, developing countries have been privatizing their state-owned telecommunication firms. The newly-privatized firms were given an „exclusivity period‟, whereby the government allowed these firms to operate as a monopoly for some years. The exclusivity period was typically granted to increase the sale price of the firm and thus government revenues, at the cost of delaying competition in the sector, which also delays improvements in telecommunication services to the population (Wallsten 2000).
(formally operating as Mobitel and now as Tigo), Zantel and Celtel. The success story of Tanzanian connectivity is on the mobile telephones. It was first introduced in 1994 and has enjoyed strong growth since 1999. The growth in the mobile market picked up with the market entry of Vodacom in 2000 and the introduction of prepaid services. Mobile telecoms operators have considerably extended their network coverage in the past few years. The operators are constantly rolling out their network to cover even the smaller towns and the market is highly contested. Despite the fierce competition in the mobile market, the current tariffs are still too high for the majority of the population to afford (Esselaar, Stavrou and O‟Riordan 2004).
A report from Intelcom Research and Consultancy (2002) indicated that, in the case of Tanzania, the growth of the cellular phone industry has been phenomenal. Today, and increasingly in the future, cellular is to be the most significant entry point to the information society for Tanzanians. The report explains that cellular networks now cover an estimated 50 percent of the total population, including 33 percent of rural Tanzanians. Other authors, such as BBC (2005), Burrows (2003), Cronin (2004), Grant (2004), Hamilton (2003), Hancock (2005) and Ross (2004), reported the tremendous growth of the mobile phone industry, not only in Tanzania but throughout Africa.
In of despite these tremendous improvements, most rural areas of Tanzania are still not covered.
In most rural areas the majority of the people still cannot afford the services, mainly due to high initial costs of the mobile phones and, in most cases, the network is patchy or not available.
2.3.1.4 Internet, data services, broadcasting and other services
The Tanzanian ICT market has a number of other operators, including public data communication companies, public internet service providers (ISPs) and broadcasters for television and radio. The Tanzania regulator has introduced a new convergence licensing regime, aimed at the implementation of a full liberalisation policy, following the expiring of exclusivity rights given to incumbent telecommunication operators, Tanzania Telecommunications Company Limited (TTCL), in February 2005 (Mireny 2006; TCRA 2005; ITU 2005a). Whereas in the past, operators were given a licence for each of the services they are providing, under the new licensing regime licensees are authorised to provide different services under a single licence.
The introduction of the converged licensing framework is considered a key strategy for addressing the technological, market and service convergence. According to TCRA (2007b), the essence of this new regime lies in the convergence of fixed and mobile, voice and data, data and content and IT and telecommunications. The new licensing regime is expected to ensure efficient utilisation of facilities and network resources for a broader range of ICT services, encourage market entry by a full range of operators, including large-scale and micro- entrepreneurs, and encourage infrastructure development and hence provide Tanzanians with a choice of high-quality and affordable services (TCRA 2005). The converged licensing framework has four categories of licences which include a network facility licence, a network service licence, an application service licence and a content service licence.
2.3.1.4.1 Network facility licence (NFL)
This licence authorises ownership and control of electronic communication infrastructure including earth stations, fixed links and cables, public payphone facilities, radio communications transmitters and links, satellite hubs, satellite control station, space station, submarine cable landing centre, switching centre, towers, poles, ducts and pits used in conjunction with other network facilities (Mfungahema 2006; TCRA 2007b; Ulanga 2005).
Up to the end of 2006, TCRA had licenced five network facility companies. Four of them operate both national and international network facilities and one operates a national network facility (TCRA 2007c).
2.3.1.4.2 Network service licence (NSL)
This licence authorises the operator to establish electronic communication networks and deliver services. This category includes bandwidth services, broadcasting distribution services, cellular mobile services, access applications service and space segment services (Mfungahema 2006; TCRA 2007b; Ulanga 2005). Up to the end of 2006 TCRA had licenced five network service companies. Four of them operate both national and international network services and one operates a national network service (TCRA 2007c).
2.3.1.4.3 Application service licence (ASL)
This licence authorises the reselling or procurement of services from network service operators. The salient feature of this licence is that the licensee does not own network infrastructure, nor operate the network. Examples are internet providers, virtual mobile providers, payphone services, public cellular services, IP telephony, public payphone service and public switched data service (Mfungahema 2006; TCRA 2007b; Ulanga 2005). Up to the end of 2006, TCRA had licenced twenty-four application service companies. One of them operates at international level, seven operate at national and international level, sixteen operate at national level and one operates at regional level (TCRA 2007c).
2.3.1.4.4 Content service licence (CSL)
This licence authorises the provision of content such as satellite broadcasting, terrestrial television broadcasting, terrestrial radio broadcasting and other electronic media (Mfungahema 2006; TCRA 2007b; Ulanga 2005). Up to June 2006, TCRA had given content service licences to thirty-seven national, regional and district (community) radio stations.
Twenty-one television stations were also licenced (TCRA 2007b).