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China’s State-Owned Telecom Firms Developing $500m Fiber-Optic Cable Network to Rival US-Backed Project

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China’s three main telecom carriers, China Telecom, China Mobile, and China United Network Communications Group, are reportedly in the process of mapping one of the world’s most advanced and far-reaching subsea cable networks.

The network, called EMA (Europe-Middle East-Asia), is expected to link Hong Kong to China’s island province of Hainan before snaking its way to Singapore, Pakistan, Saudi Arabia, Egypt and France.

The proposed cable, costing approximately $500 million to complete, will be manufactured and laid by China’s HMN Technologies, a fast-growing cable firm whose predecessor company was majority-owned by Chinese telecom giant Huawei Technologies.

The Chinese state is expected to provide subsidies to HMN Tech for the development of the cable.

Undersea cables carry more than 95% of all international internet traffic, and these high-speed conduits for decades have been owned by groups of telecom and tech companies that pool their resources to build these vast networks so that data can move seamlessly around the world.

China’s plan to develop a rival undersea fiber-optic internet cable network, coming in the wake of the US government’s concern about Beijing eavesdropping on internet data and the blocking of licenses for planned private subsea cables that would have connected the US with the Chinese territory of Hong Kong, including projects led by Google, Meta Platforms, and Amazon, has raised questions about the future of the internet.

While China’s three state-owned telecom firms are expected to own more than half of the new network, they are also striking deals with foreign partners.

The firms this year signed separate memoranda of understanding with four telecoms: France’s Orange, Pakistan Telecommunication Company, Telecom Egypt, and Zain Saudi Arabia, a unit of the Kuwaiti firm Mobile Telecommunications Company.

The Chinese companies have also held talks with Singapore Telecommunications, and other countries in Asia, Africa and the Middle East are being approached to join the consortium as well.

The China-led EMA project is intended to directly rival another cable currently being constructed by US firm SubCom called SeaMeWe-6. The consortium on the SeaMeWe-6 cable, which initially had included China Mobile, China Telecom, China Unicom and telecom carriers from several other nations, initially picked HMN Tech to build that cable. But a successful US government pressure campaign flipped the contract to SubCom last year. The US blitz included giving millions of dollars in training grants to foreign telecom firms in return for them choosing SubCom over HMN Tech.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Telecommunications

NCC Files Copyright Infringement Charges Against MTN Nigeria and Others

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Karl O Toriola - Investorsking.com

The Nigerian Copyright Commission (NCC) has taken legal action against MTN Nigeria Communications Ltd. and four individuals, including its Chief Executive Officer, Karl Toriola, over alleged copyright infringement.

The charges, filed in the Federal High Court, Abuja Division, revolve around the unauthorized use of musical works belonging to artist Maleke Idowu Moye.

According to the NCC, the defendants are accused of offering for sale, selling, and trading musical works of Maleke without his consent between 2010 and 2017. These works were allegedly used as Caller Ring Back Tunes without proper authorization.

The musical pieces in question include popular tracks such as “911,” “Minimini-wanawana,” and “Stop racism,” among others.

The commission further alleges that the defendants distributed these musical works to subscribers without authorization, infringing upon the rights of the artist.

The charges are based on provisions of the Copyright Act, Cap. C28, Laws of the Federation of Nigeria, 2004.

As the case awaits assignment to a judge and a fixed date for mention, it marks a significant development in the ongoing efforts to uphold copyright protection in Nigeria’s telecommunications sector.

This legal action underscores the NCC’s commitment to safeguarding the intellectual property rights of artists and creators within the country.

MTN Nigeria, a major player in the telecommunications industry, now faces a legal battle that could have broader implications for how intellectual property rights are respected and enforced within Nigeria’s digital landscape.

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Telecommunications

MTN’s MoMo Sees 32.2% Surge in Transaction Volumes

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MTN Nigeria - Investors King

MTN Group’s mobile money platform, MoMo, has experienced a 32.2% surge in transaction volumes.

With 72.5 million active users, MoMo continues to solidify its position as a leading fintech service provider in Africa, tapping into the continent’s burgeoning mobile banking sector.

The company’s success underscores the growing trend of Africa’s young and tech-savvy population embracing mobile technology to address financial needs.

Mobile phones are increasingly becoming a tool for bridging gaps in services, particularly in banking, presenting a lucrative opportunity for wireless carriers like MTN to capitalize on the burgeoning fintech market.

MTN’s achievement comes as it finalizes a deal with Mastercard Inc., valuing its fintech business at an impressive $5.2 billion.

This strategic partnership further enhances MTN’s position in the digital finance space, positioning it for continued growth and innovation.

However, MTN is not alone in its fintech endeavors. Rivals such as Airtel Africa Plc, Safaricom Plc, and Vodacom Group Ltd. are also making strides in digital transformation, with plans to separate and monetize their fintech businesses in the long term.

Airtel Africa, for instance, is reportedly considering an IPO for its mobile money unit, indicating the high stakes and intense competition within the sector.

Despite the remarkable success in its fintech ventures, MTN faced challenges in its core telecommunications business, with service revenue growth slowing to 6.8%.

Inflation and currency devaluation in key markets, particularly Nigeria, impacted profitability, highlighting the complexities of operating in diverse African markets.

As MTN continues to expand its fintech footprint and invest in infrastructure to enhance connectivity across the continent, it remains poised to capitalize on the immense potential of Africa’s digital economy.

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Telecom Operators Grapple with Rising Diesel Costs, Spending Hits N50.28 Billion

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Telecommunications - Investors King

As diesel prices continue to soar, Nigeria’s telecom operators are facing mounting challenges with expenditure on fuel hitting N50.28 billion in February.

This represents a 50.20 percent increase from the N33.48 billion spent in the same period last year, reflecting the growing financial burden imposed by escalating fuel costs on the sector.

Diesel serves as a critical component in powering telecom infrastructure, including base stations, which heavily rely on generators due to the country’s unreliable grid electricity.

Industry estimates suggest that operators consume an average of 40 million liters of diesel per month to sustain telecom sites, with prices reaching N1,257.06 per liter in February 2024.

The reliance on diesel for powering essential infrastructure has become increasingly unsustainable, threatening the sector’s operational viability.

Gbenga Adebayo, president of the Association of Licensed Telecommunications Operators of Nigeria (ALTON), emphasized the adverse impact of diesel costs on the industry’s sustainability, noting that infrastructure companies bear the brunt of these expenses.

Adebayo highlighted the urgent need for new pricing regimes to address the widening gap between production costs and current telecom service prices.

While investments in alternative energy sources such as solar power present opportunities for mitigating diesel reliance, challenges such as intermittent supply and vulnerability to theft underscore the complexity of the situation.

The escalating diesel costs have prompted telecom operators to advocate for adjustments in service pricing to ensure the sector’s long-term viability.

As the industry grapples with these challenges, stakeholders are calling for collaborative efforts to address the root causes of the rising fuel expenses and safeguard Nigeria’s telecom infrastructure.

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