High-speed Internet Under Expansion In Algeria


Consumers may soon have better access to the internet in Algeria, with the government set to invest in fixed-line networks and mobile operators preparing to launch 3G services.

algeria_ictIn August the government announced it would channel AD140bn (?1.30bn) into telecommunications infrastructure, in part to accelerate the development of a fibre-optic network.

The investment will be funnelled into the sector through the Ministry of Post and Information and Communications Technology (Minist?re de la Poste et des Technologies de l?Information et de la Communication, MPTIC), while the state-run telecommunications operator, Alg?rie T?l?com (AT) will lead efforts to overhaul the fibre-optic network.


New entity to manage infrastructure


This follows a proposal from the MPTIC last year to establish a joint venture to manage available fibre-optic resources, according to a statement by the ministry. In July, four state-owned enterprises signed a memorandum of understanding, paving the way for the setting up of a new organisation, named the Company of Telecommunications Infrastructure Algeria.

Under the agreement, AT will hold the largest stake (55%) in the entity, while the national oil company Sonatrach and gas distribution company Sonelgaz will each receive 20%. The national rail carrier, Soci?t? Nationale des Transports Ferroviaires, will hold the remaining 5%. Combined, the four account for some 70,000 km of existing fibre-optic cables.

Many of the government?s plans to expand fibre-optic connections have focused on improving connectivity in areas deemed a priority, such as industrial developments and business parks, in line with a government drive to give Algerian enterprises the opportunity to leverage ICT services more effectively and develop their technological know-how.


Increasing access to mobile broadband


Internet connectivity in Algeria reached 15.2% last year, up from an estimated 1.6% in 2002, according to figures from the International Telecommunication Union (ITU), finishing 2012 slightly above the African average of 14.3%. However, both Tunisia and Morocco notched up significantly higher growth in internet usage over the ten-year period, with connectivity rates rising from 5.3% to 41.4% and 2.4% to 55% respectively.

Much of the growth in Morocco and Tunisia can be attributed to improved mobile internet services. In Morocco, where 3G was introduced in 2006, around 80% of users access the internet through their mobile phones or via a broadband USB dongle, according to that country?s National Telecommunications Regulatory Agency. In Tunisia, 3G services have been available since 2010.

Algeria has now moved one step closer to offering 3G, something that has been in the pipeline for two years now, with the government having issuing provisional licences in mid-October to Orascom T?l?coms Alg?rie (Djezzy), Wataniya T?l?coms Alg?rie (Nedjma) and Alg?rie T?l?com Mobile (Mobilis). According to a statement by Orascon?s parent company, VimpelCom, the licence cost AD3bn (?27.2m) and will be valid for 15 years. Under the terms of the agreement, each operator will be granted a territorial exclusivity for a period not to exceed one year.

Final licences are expected to be granted following the payment of fees and the receipt of approval from various authorities. The MPTIC has previously said that 3G services will be commercially available by December 2013.

The launch of a 3G network, a project dating back to 2008, has been delayed repeatedly for a number of reasons, including ongoing negotiations with Russia?s Vimpelcom over the ownership of Djezzy, the largest mobile operator by market share.

Still the arrival of 3G in Algeria finally looks set to be a reality. While there is little doubt that the increasing reach of the burgeoning fibre-optic network will help expand internet penetration particularly in urban areas, the rollout of high-speed mobile data services is likely to have an impressive impact on demand throughout the country.


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