Thursday, November 04, 2004

Mobile operator in a "Nigerian Letter" reaches Latvia

Everyone gets them, the letters from Nigeria, other African countries and even from Russia (claiming to be from Yukos owner Khordokovsky). They offer fabulous "business opportunities" arising from the fact that the Minister for Crocodile Breeding on The White Nile died and left USD 78.6 million in his safe. His faithful servant Kwame, is now offering to share this with you.
Not interested?
The Latvian Ministry of Transport went out with a press release announcing that it, too, had received what is, to my mind, the equivalent of a Nigerian letter offering a fabulous deal in mobile telecommunications. The MOT, of course, was serious.
A company called International Telecommunications and Technology Inc, or IT&T Company is offering to buy licences for GSM, UMTS, and CDMA-450, as well as to build its own independent nationwide network in 12 months, spending between EUR 150 and 220 million. It says it will pay LVL 1.3 million for the licences, which are not officially up for bids yet, but whose starting pricc has been pegged at LVL 500 000.
IT&T Company is nowhere and everywhere. Google it and you see the power of Google, everything ever put on the net about IT&T, meaning information technology and telecommunications. I did no better on the Federal Communications Commission (FCC) website, since IT&T Company claimed to be an FCC licenced operator offering some kind of carrier services in the US and 95 other countries.
The latest word is that IT&T Company is based in Lebanon, but I think there are only two mobile operators there - Libancell and Cellis, or something like that. Both were involved in some kind of scandals, Syrian influence, the Assad family, etc.
In any case, there are probably more than 1.3 million mobile users in Latvia, and a very optimistic estimate says there might be 300 000 potential additional users. The high ARPU business user has been taken (some might be skimmed away by Triatel with its CDMA-450 based 3G services), the middle ground is covered rather well by Tele2's strong Golden Fish prepaid card brand, by LMT's youth-oriented O-karte and the virtual operator Amigo hitting the teenybopper market. So that basically leaves the geezers, grannies and toddlers. Even some of them have mobiles, paid for by their children or grandchildren. So how is the EUR 200 million investment going to be returned?
All of which led me to conclude, almost at first glance, that the whole IT&T Company offering was a crackpot deal. Nobody among my telecoms contacts at Pyramid Research, the Latvian Telecommunications Association, or the Public Utilities Regulatory Board had heard of this outfit. Nor had Dana Al Khatib, an analyst at Arab Advisers Group, who I phoned in Amman, Jordan, for my newspaper. The company had done a comprehensive survey of telecoms companies in the Middle East, but apparently missed the mysterious IT&T Company.
What gives a touch of black humor to this, as to many other political events in Latvia, is that the MOT decided to publicize this lunacy as a sign that there was "interest" in the so-called third GSM/UMTS licence. I'm not belittling that, an auction may have a fighting chance, but by that standard, I get "expressions of interest" amounting to billions every week. Let's see, did I toss out that e-mail from Kwame, who is mournfully remembering his most honorable minister, deceased most horrible when he slipped and fell into a crocodile breeding tank...
Those sums are more eye-popping than what this mysterious allegedly Lebanese company has to offers.


Anonymous said...

...Lattelekom's youth-oriented O-karte... Sounds weird to me.

Juris Kaža said...

It is wierd. I have corrected it.

zedkay said...

i read about this company too
it seems to be a very good opportunity for the latvian telecommunication field and you know how much latvia needs such improvements.
Are you sure that this is some kind of a nigerian letter? I've herd thst tis company does exist and that it is really going to invest money and developp all facilities quoted in the M.O.T report.

Sincerely yours.

Juris Kaža said...

No one I know in telecoms, including analysts in London, have heard of these guys. Even the people who wrote an Arab Telecoms survey (I called Amman, Jordan) haven't heard of them. Certainly they are not one of the operators in Lebanon. So it all sounds very strange to me...

Anonymous said...

hi Juris,

I am interested in your domain, also i work in Telecom field specially GSM, and i am working in GSM licenses (Buy/sell) i don't know if we can communicate together via email or you may help me....

Anonymous said...

Kwame has written in this article is not a Nigerian name. No Nigeria can ever bear such name without meaning in our mother`s tongue. please change that impression. There are many Nigerians out there in big places doing better things in the field of education and so on.