We'll have a NZ network in four months, Econet tells Kenyans

But the company has 'squandered' millions in New Zealand, claims sceptical minister

As controversy dogs wannabe cellphone provider Econet Wireless in New Zealand and Africa, the company is claiming in Africa that it will launch its New Zealand network within four months.

Econet Wireless is currently battling in the courts to force the Kenyan government to give it back its licence to run the country's third cellphone network. The government revoked its licence last year, but a court ruling later said the government lacked the authority to do so. The government has appealed and a court is now hearing arguments.

Econet has run an intensive public relations campaign in Kenya with print advertising and a series of interviews in African newspapers in which Econet Wireless Kenya's executive director, Zachary Wazara, claims Econet New Zealand will begin its network rollout in "the next four months".

A full-page ad, which ran in several Kenyan newspapers, mentions the New Zealand operation in some detail, claiming incorrectly that Econet had "successfully bid against international operators" and acquired the licence. In fact, Econet did not bid for the licence at all but has entered into a partnership with the Maori Spectrum Trust, Te Huarahi Tika. The Trust has an option to buy a licence for 3G spectrum at a discounted rate from the Government, but has not yet exercised that option.

In the Kenyan parliament last week, information and communications minister Raphael Tuju blasted the company, saying Econet is a serial failure that is "incapable of mounting a credible communications network anywhere".

Tuju was responding to questions posed by MP Jimmy Angwenyi about how Tuju planned to protect Kenyans from any losses that may be incurred by Econet in New Zealand.

Tuju said Econet has "squandered" $4 million in New Zealand and that the ministry in charge of the project, Maori Affairs, is "on the spot" to account for the money.

Tuju also claimed Econet's founder and owner, Steve Masiyiwa, is a "wanted fugitive" in Zimbabwe after allegedly acquiring a GSM licence, selling it on to a competitor and leaving the country without paying tax.

"Instead of admitting the facts, Masiyiwa is currently using the political predicament of President Mugabe to enjoy false credibility that he is facing political persecution," Tuju told the parliament.

Tuju claimed he has credible proof Econet has approached its competitors offering to on-sell its Kenyan licence for a profit.

In the parliament, Tuju listed a series of Econet's international endeavours, claiming only one of them was a going concern.

  • In Nigeria, Econet is said to have won the bid for spectrum but failed to raise its share of the capital needed to pay for the rights, Tuju said. Its partners in the deal eventually bailed Econet out, he said.
  • In Lesotho, Econet, in partnership with South African power company Eskom, won the contract to provide cellular services but has failed to deliver, leading Eskom to sever relations with the company, said Tuju.
  • In Papua New Guinea, Econet won the bid by offering "stratospheric figures", but failed to deliver a network by deadline and forced the government into an awkward position, he said. "When they took too long to raise the money, the government conducted due diligence and found that Econet had no money to roll out [a network]." The whole debacle ended up in court after the PNG government tried to revoke Econet's licence, Tuju said.

Econet's Wazara told local media that Tuju's comments form part of a "campaign" to discredit the company before it even begins operations in Kenya.

Econet New Zealand spokesman Tex Edwards is overseas and was not available for comment as Computerworld went to press.