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UUNet, Africa Online Form Joint Venture

[SOUTH AFRICA] UUNet South Africa and Africa Online, a pan-African ISP, have announced a joint venture which will see the development of Internet services - initially in 8 African countries, with 6 more to follow thereafter.

The deal sees the formation of a new legal entity - UUNet Africa- to oversee the development. It will be jointly owned by its parent companies and will initially operate out of South Africa under the leadership of Richard Beddow, who has been named as the Chief Operating Officer.

According to Beddow, the company will be ideally placed to upgrade Africa's infrastructure and plans to establish Africa's first satellite based IP-Network.

UUNet Africa will provide Internet connectivity and corporate network services, as well as access services to major corporations. Africa Online will transfer approximately 650 corporate access customers to the new entity, along with network assets and 65 employees involved in servicing the corporate access customers to the new company.

The company hopes to be operating in 8 countries by mid 2001: Kenya, Uganda, Tanzania, Swaziland, Zimbabwe, Zambia, Ghana and Cote d'Ivoire. In the 12 months following it aims to set up in a further 6 countries.

UUNET SA and Africa Online have also entered into a 10-year network agreement. In terms of the network agreement, UUNET will provide Africa Online with Internet-based network services supported by Service Level Agreements.

Africa Online currently has 43 POPs across the continent, offering Internet access, Web development and e-commerce solutions. UUNet South Africa specializes in servicing the corporate market and has a presence in Namibia and Botswana.

With the rest of the world fiercely contested, Africa is a relatively easy market in which to establish oneself as a player in the Internet economy. Of course, the reason for this is the appalling lack of infrastructure, instability and poverty -thus lack of profits.

But by creating the infrastructure, especially through easy-to-deploy satellite, ventures like UUNet Africa will create the market currently not perceived to be there. Although the non-commercial aspects - information and education - of the Internet is of more importance to Africa, the commercial players are the only ones capable of providing access.

Ventures of this kind will bring Africa its long-sought renaissance within a few generations - if they can show a profit. Historically, infrastructure providers have had no trouble doing so.