Strive Masiyiwa, CEO of Econet Wireless Intl [ Econet is locked in dispute with Zain] said that it will be difficult to replicate the Indian wireless industry model of network outsourcing, minute factory, and infrastructure sharing in Africa. In the past African operators were approached with the network outsourcing model as these offers have been ignored by most African operators as they believe that these contracts do not make commercial sense in the African context.
54 Nations in Africa poses a Diversity Challenge – 5 new licenses issued in Tanzania taking total number of operators to 12, exit by Vodacom from Nigeria due to corruption allegations, Ghanaian government’s non-acceptance of Vodacom’s acquisition and the arrest of Western Wireless officials in Africa.
EWI is demanding a reversal of the sale to Zain in 2006 and seeking control of the 65% stake in Nigerian operations. According to EWI, Zain is not filing the requisite papers and is delaying the arbitration proceedings. EWI expects the arbitration hearing by July 2010.
Well, on the Minute Factory Model the original inventors will probably fine tune rather than directly replicating what was done in India. Finally, litigations and court room battles are inevitable with such a large takeover in an unorganized emerging market. Insiders tip that Bharti Airtel has fully secured its interests and has been able to mitigate the risk by including several clauses in the agreement with Zain and even funds being held in escrow accounts.