Orange Senegal to pay USD173m for 4G licence, paper says

7 Jun 2016

Orange Senegal is hoping to kick off its 4G service in the near future having reportedly secured a 20-year licence from the government for a consideration of XOF100 billion (USD173 million), Agence Ecofin writes, citing an article in the newspaper L’As. If confirmed, the amount represents a three-fold premium on the reserve price of XOF30 billion set by local regulator the Regulation Authority of Post and Telecoms (Autorite de Regulation des Telecoms et des Postes, ARTP) – a figure it refused to reduce, even when the incumbent operators turned their back on its call for applications in January this year. It is understood that the cellco’s majority shareholder Orange Group agreed the fee based on ARTP’s willingness to renew the operating concession of Orange Senegal’s parent, fixed line operator Sonatel, for free; the licence is due to expire in 2017.

According to TeleGeography’s GlobalComms Database, in January 2016 the ARTP announced that the call for applications for fourth-generation mobile licences had received no bids from the three incumbents – the other two being Tigo, a unit of Millicom International Cellular (MIC) and Sudatel’s Expresso Telecom – suggesting they may have boycotted the process over a disagreement on the licence fee. With the regulator refusing to revise its reserve price of XOF30 billion for the 20-year concessions, the ARTP confirmed that on 17 December 2015 it received ‘in open violation of the Public Procurement Code and the consultation regulations (Article 3.4 and Article 7.14 of the Regulations of Call for Candidacy) … a signed letter [from the] three operators to report their concern about the licence reserve price’. At the time, ARTP director Abdou Karim Sall reiterated that the watchdog considered the licence fee to be appropriate, adding that it was set as a result of ‘a benchmark of over 20 countries in the world, taking into account the quality and quantity of available frequency bands (700MHz, 800MHz and 1800MHz), the population, income of the telecom market in Senegal and obligations of the licence for 4G coverage.

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