How an African entrepreneur put cell phones in Congo.
Alieu Conteh, the chairman of Vodacom Congo, created a mobile digital communications network in a country where none had existed. In 1999, when he launched what was then Congolese Wireless Network (CWN) with just 4,000 subscribers, his nation must have seemed hopelessly ill suited for any investment in technology.
The Democratic Republic of Congo is about the size of Western Europe and has an estimated population of 65 million. But it is one of the least developed nations in the world, with less than 2,000 miles of paved roads. In 1999, fewer than 15,000 houses had land-based telephones, and no more than 10,000 people had analog mobile handsets.
In building his company, Conteh faced challenges unknown to communications executives from the rich world. Once, after equipment providers declined to send engineers to Congo during a particularly dangerous time in the country’s unending civil war, Conteh encouraged a group of citizens in Kinshasa to collect scrap metal and weld it into a cell-phone tower.
In 2001, Conteh and Vodacom, South Africa’s largest mobile-service provider, formed a joint venture in which Vodacom would hold 51 percent of the new company. By the middle of 2006, Vodacom Congo had more than 1.5 million subscribers, according to Vodacom’s annual report. Today, according to Conteh, the company he founded has more than two million subscribers. He claims that a recent offer for his shares valued Vodacom Congo at more than $1.5 billion.
Technology Review’s editor in chief met Alieu Conteh by chance at a technology conference in Tanzania. In person, Conteh, who is 55, appears optimistic, cheerful, vital. He is also richly amused by his own story. While grateful for his extraordinary good fortune and proud of his contribution to his country, he also relishes the human comedy of the founding of Vodacom Congo.
TR: Before this, had you ever worked in communications?
Conteh: I exported coffee beans. But during the civil war in Congo, I lost everything in the countryside to the rebels. When Father [Laurent Désiré] Kabila took power [in May 1997], he made a famous speech in Kinshasa. He spoke about zero tolerance for banditry and corruption, and about how Congo needed very basic things: law and order, education, roads, and telecommunications. I was very impressed with that speech.
TR: You were inspired?
AC: I was. I started to think about telecommunications. I knew the reconstruction of the infrastructure of Congo was going to need billions and billions of dollars. Maybe the whole world would have to help. But I started thinking: I was one of the few people in Congo who owned a mobile handset. The people who had handsets were mainly government ministers and their staffs, the military, expats, and a few businessmen like myself. My phone cost me $1,200 and I paid $15 a minute for every call. I saw it as an opportunity.
TR: What did you do?
AC: Two or three weeks after Father Kabila’s speech, a friend introduced me to the minister [of post and telecommunications, Kinkela Vinkasi]. I asked the minister if I could submit a proposal for a mobile license. He asked, “What type of license?” I said, “GSM.” [The Global System for Mobile communications–the most popular standard for mobile phones.] The minister was nice but firm: he said I had to provide proper documentation. And as he walked me to the door, he said, “Mr. Conteh, you understand that to build a GSM network, it’s a lot of money!” I said, “If the government will grant a license, I will build a network.”
TR: What happened next?
AC: Well, I knew zero about telecommunications. I asked my secretary, “Mrs. Baba, do you know anybody in telecom?” She said she did. This man, Gilbert Nkuli, who became our first employee, went to the minister of communications and filled out the forms. I called another friend and asked him, “Do you know any telecom vendors?” He said he knew a single vendor, Nortel. We phoned Nortel in Paris. A Nortel executive said, “Send me a letter of invitation; otherwise I can’t get a visa.” I did. A week later, he was there.
TR: He was keen.
AC: It seemed so. Well, the three of us, we all went to see the minister. We explain how we’re going to provide cell coverage for Congo’s main cities. Four months later, the minister calls me into his office and tells me that the government has approved the license, but before they can issue it, I must pay $100,000.
TR: For an exclusive license?
AC: To tell you the truth, I didn’t know. I’d never seen a telecommunications license before. But the government wanted $100,000 in American dollars to be paid to the central bank. I found the money. Three months later, the minister calls me again. Now he says, “Conteh, you have to pay another $100,000.” So I paid $200,000, but I still did not have the license.
TR: It was a shakedown.
AC: Wait! It gets funnier. In January of 1998, all the big government ministers went to a conference in Uganda on pan-African concerns. When they got back, the minister of communications phoned me and said, “The Ugandan government sold their GSM license for $8 million, and Uganda is a small country. So our license is $8 million”! I kept my cool. I said, “Okay. Give me a few days.” A week later I went to the minister and said, “Your honorable minister … $8 million for Congo? In the future, maybe. Today, no.” He asked, “Why?” I said, “The war is why. Everything is broken. Everybody is leaving the country.” Finally, he listens to me. He asks, “Well, Conteh, how much can you pay? What do you think the license is really worth?” I have to be fair. I say $2 million. He called me that evening at 10 o’clock to tell me I’d got a 20-year license to operate a GSM network in Congo.
TR: And then?
AC: Well, of course, that was just the beginning. We asked Nortel to do a study about the costs of creating the network. We talked to GTE. We hoped one of them would be our partner and invest in this idea of a Congolese GSM network. But eventually I had to be honest with myself; I had to accept that no vendor was going to put money in Congo. I went home; I asked my wife. The only savings I had was $1.5 million. She said I should follow my heart. That was so dear, so dear to me and painful. In the end, I went with Nortel. I went to Paris. I carried my checkbook with me.
TR: How did you feel writing a personal check for so large a sum?
AC: After I wrote the check, Nortel threw a party with champagne. All the Nortel executives in France were there. They wanted to know: who is the man behind this thing? Before the speeches, the president of Nortel tried to give me a glass of champagne. I said I needed water. I told him, “The day my network is done I’ll drink something, and not before.”
TR: After you’d spent your savings, you still needed capital for staff, vehicles, offices, and so on. What did you do?
AC: I sold everything: my coffee trucks, my personal car, everything. We never had enough money in the beginning. At one point, I had to tell everyone who worked for us that I couldn’t pay their salaries, but if we stuck together we would be all right in the future. You know, most stayed! And today, they’ve all bought houses.
TR: Tell me about how you finally launched the Congolese Wireless Network.
AC: The day before, tests had been going fine. I go to see the switch. I’d put it in a modern one-bedroom apartment in Kinshasa, because it would be safe there. But when I walk in the room, the engineers are very nervous. The switch isn’t working! CWN is due to be announced the next morning, at 11:00 a.m. [on February 20, 1999]. The engineers work all night; I had a Congolese grilled-meat dinner brought to them. But Saturday morning it’s still not working. The whole government has come to the ceremony at the Hotel Memling in Kinshasa. Every embassy is there. But I’m still sitting in my office. I have a GSM phone in one hand and an analog phone in the other, and I’m talking to the engineers on the analog. It’s 20 minutes to 11:00 a.m. I joined the minister and his delegation. Now he’s worried, too. He’s asking, “Should we postpone?” I say, “No, no. It’s going to work fine.”
So, at five minutes to 11, we go into the hall. We sit down on a sort of stage. The state minister representing the president of the republic is there. The Nortel representative is there. Journalists are taking photographs. The minister is hitting me on the shoulder and saying, “Conteh, can we stop this?” I think, if I panic, it is finished. And if I don’t operate the network today, it’s finished, too. Just at that moment, my GSM phone rings. I say, “Hello?” The Nortel engineer, a French guy, says, “Mr. Conteh?” I say, “Yes …” He says, “This is Sébastien. It’s working!” I say, “Sébastien, for God’s sake, don’t turn the phone off, stay on the line.” And I look at the minister, and I say, “I am pleased to announce today the very first digital telephone in Congo! The telephone will never again be a luxury in this country.” Then the crowd goes pah pah pah pah. Then I gave the phone to the minister because I was so nervous, sweating blood. The minister says, “Sébastien, Sébastien? The whole Congolese nation is listening to you! Thank you so very much!” And then at last the minister gave the phone to Kabila’s representative, who spoke to Sébastien.