China Telecom and Liquid tie up in search for scale

China Telecom Global and Liquid Telecom have announced a new collaboration to extend their respective network coverage in the African and Asian markets.

The partnership will allow both of the telcos to offer additional network solutions and services to enterprise and wholesale customers, as well as increasing coverage across two challenging regions. China Telecom Global has already established a Point-of-Presence (PoP) at Liquid Telecom’s East Africa Data Centre in Nairobi, though this will be extended facilities in Johannesburg and Cape Town.

“With more than 50 countries in the region, Africa is nonetheless the booming new market with the highest development rate just after Asia, and a very important market for CTG,” said Changhai Liu, Managing Director of China Telecom, Africa and Middle East. “This collaboration will enable both CTG and Liquid Telecom better serve our customers and explore untapped business potential for further development. Under this partnership, we are well positioned to enhance the connectivity and network infrastructure in both regions.”

“This partnership with China Telecom Global reflects the strong global demand for world-class network services across Africa. Our combined service and network capabilities will be of great value to multinationals operating in some of the fastest growing economies across Africa and Asia-Pacific,” said Willem Marais, Group Chief Business Development Officer at Liquid Telecom.

Partnerships like this should be encouraged in regions where investments can be challenging to justify. While telcos in more developed markets can build business cases around investment in network infrastructure, the difference in economics between the developed and developing nations mean the rules are not the same. Telcos in developing nations aren’t even playing the same game, as economy of scale becomes much more difficult to realise.