Essar bets on cross-border calls to boost revenue

The Indian telecommunications company will become the sixth Mobile telephone operator, joining Zain, MTN, UTL, Warid, and Orange telecom.

According to Mr Iyengar, Kanya has been granted a licence to build a 200 million-dollar cellular phone network in Uganda. Essar Teleholdings, a member of the Essar Group, obtained a similar licence in Kenya last year and operates under the Yu network.

According to the Managing Director of Essar Telecom Kenya, Srinivasa Iyengar, three million dollars has been paid for frequency charges to Uganda Communications Commission.

He said the service in Uganda will be launched in September, 2009.Essar Teleholdings, which will own 90 per cent of the stake in the Uganda venture.

At the same time, the company is also bidding for licences in Tanzania, Congo and Cameroon.

In Zambia it will bid and participate in the privatisation of Zambia Telecommunications Co. Ltd (Zamtel), a state-owned cellular phone company.

Last year, Econet Wireless International sold a 49 per cent stake in the company to India’s Essar Communications Holdings, paving its entry into the lucrative Kenyan market where Econet had been granted a license but was unable to rollout.

Pricing model
The operator introduced some of the lowest calls rates and introduced free SMSs in the Kenyan market it is planning to replicate its least cost pricing model on its regional operations, setting the stage for a pricing war for the regional market.

Mr Iyengar says the seamless networks will be strategic for their subscribers by reducing the call charges across the borders.