Cable & Wireless Seychelles’ sale saga |26 November 2019
Have you ever wondered why we get so many things wrong before we get it right? It is said that ignorance is bliss and can lead one into the abyss. Similarly greed sacrifices all moral traits; greed pollutes the soul, corrupts religion and destroys humanitarian values.
The background
I left Seychelles in 1955 to join my parents in East Africa where I completed my apprenticeship with Tanganyika Power and Lighting Company. In 1960 I went to the UK and I got a job as a trainee technician with British Telecom (BT) and I spent 15 years of my evenings at colleges learning my trade and getting qualified. I worked my way up the ladder into senior managementin BT then I went to work for Ericsson in Sweden then I became a Telecommunications Consultant carrying out assignments for companies like AT & T in the US, Duetche Bank in Germany, Ascom Autelca in Switzerland and others. I grew up with the change of technology from adjusting relays in Strowger Exchanges to learning how to balance Crossbar switches and the introduction of analogue and digital exchanges. In all my years in the telecommunications industry I have never seen a scenario like the way Cable & Wireless Seychelles is being played.
Two years ago I wrote an article calling for Cable & Wireless Seychelles to be sold to Seychellois because “no one knows Seychelles better than Cable & Wireless Seychelles” – nice one. I also complained to the toothless bulldog DICT that school children were being robbed of their data which they had purchased with their dinner money. They buy a data pack on their way home, they use it for a few minutes and while they are asleep their data disappears and they wake up with hardly any money left on their data pack. I sent them my print out showing 21 operators were taking money from my telephone bill without my consent and Cable & Wireless Seychelles told me they had no control over this phenomenon which was a load of rubbish. How can you charge me for something I have not used then you turn round to me and tell me you have no control? The first thing the new owners need to do is to replace the senior management team in Cable & Wireless Seychelles to achieve any progress.
There are some very good Seychellois working in Cable & Wireless Seychelles but the way they have been treated by senior management is unacceptable, morale is low, it takes on average 6 minutes to get answered when I dial 100 or 181 or 121 then a recoding comes on the line and informs me that I will be answered in 30 seconds then the next thing the same announcement ask me to call back later because all operators are busy then out of the blue and if I wait on the line someone answers. Confused.com? Yes? Cable & Wireless Seychelles used to give a very good service; in fact I trained some of the staff but the service level has deteriorated to such a low level that I would not now buy shares in Cable & Wireless Seychelles until they get their act together. Heavy advertising on TV does not improve the service.
Today’s telecommunications environment
We heard the Minister for Finance, Maurice Loustau-Lalanne, and the chairman of the Seychelles Pension Fund, Jacquelin Dugasse, tell us on SBC TV during the National Assembly sitting last week that one due diligence after another have been carried out and they are prepared to pay a premium for shares in Cable & Wireless Seychelles using the hard earned money those of us who are still working are paying towards our pension contributions. Did they consult a telecommunications expert or they consulted financial experts only. In such a high tech environment you need experts in the industry to get involved in the due diligences because technology is changing so fast that if you are not careful you will buy a pig in a poke. Have they looked at the agreements with the long distance carriers who take the traffic from Seychelles and deliver to the destinations? Have they reviewed the agreements between the owners of submarine cables 1 and 2? Financial due diligence is not sufficient in a fast moving technological environment.
When you look at the Seychellois entrepreneurs who have bought into Cable & Wireless Seychelles they are JFA Group consisting of Jamshed Pardiwalla, have you heard of them before? Ravji, who is Ravji? Rahhwani who is this guy? Andy Bainbridge an English name but we are told he is Seychellois then ACM whom I know very well because they were involved in The Victoria Times newspaper saga which is the subject of a court case for which ACM carried out a due diligence. How come all these new owners share the same address? Then these guys bought the company from money borrowed from Trade Development Bank (TDB) formerly the PTA Bank, which is a trade and development financial institution in Africa. The TDB is the financial arm of the Common Market for Eastern and Southern Africa (Comesa), although membership is open to non-Comesa States and other institutional shareholders, then Barclays is mentioned (not Absa), ABC Banking Corporation of Mauritius is involved and of course Nouvobanq being the government’s private bank and the preferred bank of those in the high echelon in our society.
Yet Cable & Wireless Seychelles has failed to pay the people of Seychelles US $16.5 million in stamp duty for the last 3 years and one Minister for Finance after another has failed to get Cable & Wireless Seychelles to pay its debt and here we are these banks are lending money to a company that cannot pay its debt all because there are two major pieces of land involved which are the land where Kaz Kreol stands next door to Cable & Wireless Victoria Offices and a piece of land in Bon Espoir where the satellite dishes and weather forecast equipment are located on Montagne Posée. If you or I owed this government R100 and we did not pay we would have been taken to the Magistrates Court a long time ago. So why has Cable & Wireless Seychelles not been taken to court? Who in high places have vested interest in this saga? This is how the cookie crumbles in Seychelles. There is one law for the rich and another law for the poor.
Who carried out the Due Diligence?
Has an expert in telecommunications carried out a study or market survey to show whether Cable & Wireless Seychelles will make any money in the future before we invest the hard earned money of pensioners? Or have the people involved in the investment activity just taken into consideration the financial aspects such as SWOT analysis of the company’s worth? Please publish the study. It is generally known in the telecommunications industry that the bubble has burst for a killing to be made in the telecommunications industry. The answer is very simple. People nowadays are using WhatsApp to make calls, send text messages and videos all over the world because WhatsApp is free. Huge chunks of traffic that used to go via the telecommunications companies networks now go free of charge on WhatsApp and there is another rival to WhatsApp being formed. In addition Social Media’s free access will continue to impact on the mainstream business of the major telecommunications operators around the globe and Seychelles will not be spared. Has the Seychelles Pension Fund commissioned its own expert to give them the real picture? Mr Dugasse said the Pension Fund has its own team of investment experts and they advise the Board and the Board makes the decision. Which telecommunications expert has been brought in to advise the Investment Team of the Seychelles Pension Fund? Please make such recommendations public.
The global evolution of telecommunications
1G – is the analogue technology (AMPS) which could not carry data. Data lines were provided separately then came 2G - which was the second generation and it transmitted in digital format but at very low speed. It encrypted voice, text and data into GSM and CDMA formats. The next development was 3G - where the data speed was increased to 3 Mbps making transmission of video possible. Then came 4G - which increased the data speed to 100 Mbps using High Speed Packet (HSPA) technology.Then came 4G LTE - which just changed the speed of the down-link to up to 300 Mbps and the Up-link to 75 Mbps, not much to write home about. This technology has 20% market penetration in the USA where Donald Trump has banned Huawei from launching its 5G network. It is expected 5G will move data even faster where land line traffic, mobile phones traffic, radio, TV, videos-on-demand and other stationary services like alarms can all be carried on this new network. It is expected 5G will not change the price of eggs at STC but the price of eggs can be moved at lightning speed.
The future of telecommunications
Telecommunications traffic across the world continues to grow but the revenue is on a downward trend. It is like the number of tourist arrivals in Seychelles has increased but the spending by tourists has declined because they travel by bus instead of taking a taxi. You can’t blame them when a taxi from the airport to Victoria costs R500. The 5G technology is being offered to the UK by Huawei and in Seychelles Airtel is struggling to deploy its 4G while Cable & Wireless Seychelles remains silent on its deployment of 4G or the likelihood of 5G hitting the shores of Seychelles. Maybe they don’t have access to either, who knows?
In China Hauwei, Xiaomi, Oppo and Vivo produce 1.8 billion smartphones a year which accounts for 90% of the global production of smartphones and these new smartphones have embedded software which are ready for the 5G networks. So the question we must ask ourselves is how come 10 years ago China had no such technology and only Nokia, Ericson, Philips and lately Samsung of South Korea developed such technologies. How come China has leap-frogged over these old and established developers and manufacturers and have come up with 5G technology? It begs the question and I leave it to your imagination to fathom out how this came about and now maybe we can understand why Donald Trump is banning Hauwei from entering the US market. Has Silicon Valley security been breached and the know-how purloined? Who knows?
Just to finish this article on a lighter note it would appear there is a study out there that purports that mobile phones are reducing the world population. Apparently young couples nowadays spend their evenings playing on their mobile phones instead of playing with each other and making babies. So there you are the mobile phone has brought us some global benefits. So what are we going to do with Cable and Wireless Seychelles?
I believe Seychelles Pension Fund must take a breather and re-assess the whole project and establish the future benefits of buying shares in Cable & Wireless Seychelles. Don’t forget it was not long ago that a Derivative Exchange tried to call themselves Seychelles Stock Exchange, we do not have a Stock Exchange and we are not stupid.
Contributed by: Barry LaineFCIM, FInst SMM, MCMI, MBSCH
Email: barrylaine@hpcgroup.sc
www.academyofhighperformance.sc
Disclaimer: The views expressed in this article are those of the author and do not necessarily reflect the views of the Seychelles NATION newspaper.