Portugal Telecom ready to go pan-African

Details: Alec Barton; Category: Trends & Forecasts; 15 March 2007; 11200 views

Portugal Telecom's African operations are set to expand well beyond her present low-key portfolio of four former colonies and a half-share of a partnership in Morocco. The strategy is based on Africa's currently low tele-density. First step is a mobile virtual operation in Angola.

Henrique Granadeiro, CEO of Portugal Telecom, has been outlining his company's strategy for operations in Africa. They go well beyond merely consolidating an existing portfolio of four former colonies, a joint operation with Telefonica in Morocco, and recent stakes in Namibia and the Democratic Republic of the Congo.

Quite simply Senor Granadeiro wants to establish a presence throughout Africa. And it is Angola which is to be the base for a brand-new pan-African operation, in competition with enterprises that have selected South Africa as their pan-African HQ. "The big pan-African operators are centred in South Africa or in the Middle East but we believe in a new pan-African operator based elsewhere, namely in Angola," Henrique Granadeiro told newsweekly Visao.

The four ex-colonies are Angola, Cape Verde, Guinea-Bissau and Sao Tome and Principe. What they share in common with Morocco and Namibia is that they are locations for Portugal Telecom's mobile services. NMT is the Namibian operator, Portugal Telecom having purchased a 34% per cent stake in that company last March.

For Senor Granadeiro Angola could well be the right place for its pan-African strategy, as it could work in tandem with local mobile services operator Unitel (this is where Portugal Telecom has a 25% stake). What is not intended is for Unitel to be the heart of a pan-African operation.

Two incentives for any would-be investor in African mobile are the facts that ownership is low and that growth is high. Indeed, ITU is currently singling out Africa as having the highest mobile growth of any continent.

* Portugal Telecom has stakes in mobile operators in several other African states, including Morocco (Médi Télécom), Namibia (Mobile Telecommunications), Cape Verde (Cabo Verde Telecom) and Sao Tome & Principe (Companhia Santomense de Telecomunicações). In March 2006 a consortium of Portugal Telecom (60%) and Unitel (40%) bought a 51% stake in a GSM-900/1800 licence in the Democratic Republic of Congo.

More info: