Argent in Iraqi telecoms coup

By PETER GRIFFIN telecoms writer

Argent Networks has made further ground in the Middle East, striking a $3.5 million deal with Iraq Telecom that makes it the first New Zealand company to pick up a sizeable deal in post-war Iraq.

The contract win by the Auckland telco brings to $10.2 million the total value of business it has won in former war zones in the Middle East and Africa.

Last month it secured mobile operator LiberCell as a customer in the West African nation of Liberia. In November 2002 it set up business in Afghan capital Kabul with a local mobile operator.

Argent will again install its ArgentEclipse customer billing system on a network, but this time it is with a fixed-line provider, Government-owned Iraq Telecom. Previous deals have been with mobile operators.

New Zealand's lack of support of the United States-led invasion of Iraq had worried some that New Zealand companies would be excluded from rebuilding work there.

But last year the US Government gave New Zealand companies the go-ahead to begin bidding for reconstruction contracts. An estimated $29 billion in contracts have or will be awarded as part of the rebuilding effort.

Jones said nationality had proved neither an advantage nor a hindrance in pursuing the business.

"There was nothing from a political standpoint. We're perceived as relatively neutral. There's no axe to grind with New Zealand," said Jones, who spoke to the Herald from Beirut.

He said that after more than a decade of economic sanctions being imposed on Iraqis, local entrepreneurs were thriving in their new freedom.

"The time to do business is now. New relationships are being established, old relationships re-established," he said.

Still, Iraq is a volatile place to do business and key infrastructure often bears the brunt of attacks. According to reports quoting Iraqi communications minister Haidar Al-Ebadi, a major telephone exchange in Baghdad was bombed last week, killing one person and wounding another.

Jones said he knew the risks, which had accompanied his other two contracts as well.

"Everyone's conscious of it, but here's an opportunity to help rebuild a country," he said.

The deal involved Argent joining a consortium of telecoms services suppliers fronted by consultancy Technology Partners.

The total value of the deal to the consortium is $15 million and there are opportunities for Argent to win more work - service and support beyond the warranty period is not included in the contract value.

"There's more in it for us. It's a very big account," said Jones.

As with Afghanistan and Liberia, mainly locals will be employed by Argent to run the system, but a team of New Zealanders will be based in Baghdad to get it up and running.

With just under a million telephone subscribers in Iraq and 250,000 mobile subscribers, huge growth in telecommunications use in the country is expected. The population is around 25 million.

Jones said demand for mobile services was outstripping supply.

Asiacell, operating in the North of Iraq, runs a GSM system and claims to be picking up 1000 subscribers a day. It now has 125,000 subscribers.

Despite sustained economic sanctions after the Gulf War of 1991, Iraq's telecoms network was rebuilt. The war last year knocked out part of the country's fibre optic network and several telephone exchanges.

Many telephones in Baghdad still remain disconnected. Argent would work across 250 exchanges and five call centres,

"There's some sophistication there. We're not starting completely from scratch," said Jones.

Argent was still looking for more work in the Middle East and Africa, which it is focusing on in the next two years.