THE TANZANIA Telecommunications Company Limited (TTCL) last week launched its prepaid system for fixed-lines in Dar es Salaam, saying it hoped to hook up 80,000 new customers in the first six months.

The system comes at a time when TTCL is at loggerheads with the telecommunications licensing authority for failing to increase the number of fixed lines as promised by the strategic investor MSI/Detecon of the Netherlands. The investor had promised to raise the number of fixed lines from 180,000 to 800,000 in five years. Although it inherited the 180,00 fixed lines, it has since added just over 40,000 lines to take the total to 220,000, of which to date only 136,000 are active.

The MSI/Detecon management says it is positive that the new system, worked via intelligent network, will provide an easy and cost-efficient way to manage customer call patterns that gives customers complete control of their accounts and budget, thus attracting more customers.

On the first day of the prepaid service, last Tuesday, 1,000 customers joined the service. TTCL, the sole provider of fixed-line telephone services in Tanzania, also operates a cellular phones subsidiary, Celtel.

Chris Keeping, head of the prepaid project, told The EastAfrican: "There is definitely a market for the prepaid system in Tanzania."

Mr Keeping was transferred to TTCL from Celtel, which now boasts some 300,000 subscribers. Celtel is one of four mobile firms operating in Tanzania, the other three being Vodacom, Mobitel and Zantel.

TTCL says another reason for introducing the prepaid system for land lines is to curb telephone line clipping, which has become a common practice in Tanzania, leaving TTCL with huge unpayable bills and disheartened customers who fall victim to the scam.

Karim Bablia, TTCL’s head of marketing, said the new service aimed at wooing back customers who had found it difficult to control their telephone bills. TTCL has lost over a million potential customers who have moved to cellular phone services.

He said the prepaid top-up service for the fixed lines works like scratch card vouchers. But a customer wishing to join this new service will first have to clear outstanding bills, he added.

The prepaid vouchers for fixed lines will be in denominations of Tsh2,000 ($2), 5,000 ($5), 10,000 ($10) and 50,000 ($50). 

Moreover, corporate customers who make international calls and are hooked up to the Internet, will be offered Tsh150,000 ($150) scratch cards. 

TTCL is targeting the Dar es Salaam market, where there are over 65,000 fixed line customers, before it moves to Arusha and Mwanza.

However, the connection fees, of Tsh40,000 ($40) for urban and Tsh25,000 ($25) for rural customers, remain the same. Customers will, however, pay more for monthly rental dues. Apart from the monthly charge, prepaid customers will pay an extra Tsh180 ($0.18 US cents) per day. This will make the new pre-paid service more expensive, at Tsh9,200 ($5.20) than the current monthly charge of Tsh3,800 ($3.8). No explanation was forthcoming for the daily charges, given that the customer pays a monthly charge as well.

According to Hans Wagenaar, chief operating officer of TTCL, the company’s failure to install the 450,000 fixed lines as promised in the privatisation articles, was based on "considerations of profitability."

He said a fixed line must be able to generate revenue of $42 per month; less than that is considered uneconomical.

"We cannot go on constructing new lines if they are not generating sufficient revenue. The company's new strategy will focus on those aspects of the fixed-line business that generate more revenues," Mr Wagenaar said.
 

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