Lap Green, a Libyan firm that took over 80 per cent of Rwandatel last year has already invested Rwf 36 billion (USD 65 million).
The investment has turned around the formerly indebted firm into a more competitive telecom company with modern infrastructure.
“We can now host a minimum of one million subscribers and a maximum of two million subscribers on the upgraded network,” Patrick Kariningufu, Rwandatel Chief Executive Officer (CEO) revealed in an interview with Business Times.
On taking over Rwandatel, October last year, the Libyan government consortium promised to invest USD317m (Rwf 173.4b) over the 15 years.
According to the business plan, USD87m (Rwf47.6b) was supposed to be investment in the first 12 months.
“[Already] Rwf 36b has been invested in buying generators, towers and the construction of 98 percent of the 164 Base Transceiver Stations (BTS),” Kariningufu said.
Initially the telecom company was supposed to have launched GSM system in August, this year however, management says that due to the Kenyan crisis early this year, delivery of necessary equipment was delayed.
“We lost about three months of our planned time. Rwanda being landlocked, all imports come through Mombasa and unfortunately our equipment was held for a longer period as a result of this crisis. This delayed installation and the rollout process of the GSM network system,” he added.
GSM is an acronym that means Global System for Mobile Communication. It is a digital mobile telephone system that is widely used in Europe and other parts of the world.
GSM uses a variation of Time Division Multiple Access (TDMA) and is the most widely used of the three digital wireless telephone technologies which include TDMA and CDMA that Rwandatel has previously been using.
The company has built 60 base station antennas countrywide in less than a year, positioning Rwandatel to smoothly migrate from CDMA technology to GSM.
Out of the Rwf36b, Rwf23.7b has been signed to Huawei Technologies Company Limited, the largest networking and telecommunications equipment supplier in China and so far majority of the equipment has been acquired and installed.
Apparently, Kigali City is fully connected to the 3G GSM network system. Last year in August, President Paul Kagame tested the new 3G GSM network by making a video call during his tour of the Rwandatel stand at this year’s Trade Fair at Gikondo Expo Grounds.
Karinigufu said that very soon, Rwandans will enjoy the GSM network.
This system enables users to conduct wireless video calls and access broadband data in the mobile environment.
Rwandatel upgrades its network at a time the telephony penetration rate in the country is still low—at only 8 percent compared to other regional countries with slightly higher rates.
Uganda has 20 percent while Kenya is at 25 percent penetration rate.
Kariningufu, however, said that when they launch their GSM—the telephony penetration will increase to the highest by introducing affordable services.
He partly attributes the low telephony penetration rate to the high cost of handsets, calls and the few players in the industry.
“Monopoly has existed long enough in the telecom industry in Rwanda. It is now time to offer Rwandans the best telecommunication services at affordable rates,” he said.
He is also very optimistic that by the end of 2009, Rwandatel will have 750,000 subscribers from the current less than 100,000.
In preparation for such numbers, Rwandatel has embarked on training its human resource. Accordingly, at least over 200 Rwandans are now employed and trained in the customer care department.
“Our call centers will host about 75 agents 24 hours. And we have already recruited 40 engineers and trained 100 on the GSM network service,” Kariningufu said.
Drawing from Lap Green’s successful operations in Niger and Uganda, Kariningufu said that Rwanda Rwandatel, is competitive.