By Emeka Aginam
MR. Tomi Davies, a top Information and Communications Technology (ICT) executive with management experience in the UK, US and Africa is the Chief Operating Officer (COO)  of Mobitel Limited, acquired by a consortium led by Omni Ventures in 2008.

In this interview, he said that the pervasive nature of GSM and its allied data technologies such as SMS, GPRS, EDGE and HSPA all contributed to the decline of CDMA in Nigeria. He also spoke on  the company’s expansion plans and challenges of the industry. He then revealed that average revenue per user (ARPU) in voice sector is declining daily. The focus, according to him is on data. Excerpts:

MOBITEL was issued a national license on the 2.3 GHz frequency in September 2010, and recommenced operations in October rolling out 4G broadband and voice services. How has it been despite challenging market environment?

*Tomi Davies, COO, Mobitel

It’s been quite an exciting and challenging time really. We’ve been able to learn a lot about the industry and better understand our operating environment and its peculiarity. In all of it though, we are glad to have been able to carve out a niche for ourselves, advancing a model that is centered on care.

Care is so central to what we do that it is one of our three corporate values; the others are quality and simplicity. We are focused at delivering unique customer experiences which makes customer care very paramount in our operations.

We currently have a 24/7 customer centre with agents dedicated to respond to customer complaint calls and resolve them. In addition, we have a well-trained and highly motivated technical support team that responds promptly to all customer challenges and best of all, we have activated various channels through which our customers can reach us, especially through our active social media platform. This is differentiating us from others.

Flexible plans

From April 2011, we offer you compelling reasons to become a part of the fast growing Mobitel community. First is that there are now more flexible service plans and device options that suit your upwardly mobile lifestyle. Our fixed and Mobile 4G Access devices can be procured at an outlet near you.

The list of retail outlets is available under the shops and outlets icon on the website.You can also order directly from our facebook page and we would deliver to your home or office everywhere within our coverage areas. We have set up Mobizones at popular places of convergence across Lagos.

What are the strategic plans of Mobitel for voice and data?

Generally, world over there is an increased focus on data technology and having read the business direction well, we are blazing the trail in that regard. You are aware that ARPU in voice sector is declining daily, so the focus is on data. However we also offer voice services with our unique 3200 number series.

Subscriber base of  fixed wireless telephone lines appear to be shrinking by the day. Do you think they need a bail-out to survive?

I do not subscribe to the bail-out school of thought. Fixed wireless technology can be a lucrative operation provided the right conditions exist. What we have is a proliferation of small operators with restricted regional spectrum licenses making it a challenge for survival.

It will be interesting to see what happens in the industry as increasing demand for broadband data services opens up the market for another GSM like revolution. I foresee a situation where mergers and acquisitions driven by spectrum availability and customer bases become the industry’s transit route to the new paradigm of frequency-agnostic telecoms operations driven by the imminent arrival of 4G technologies such as HSPA+, Wimax 16m and of course LTE.

What do you think is responsible for shrinking market for fixed wireless operators?

Well, I don’t really see a shrinking market for fixed wireless operators in Nigeria. What I do see is a shrinking market for non-GSM voice operators. The market for fixed-wireless data is actually growing and will continue to be highly lucrative for years to come.

Having said that, the pervasive nature of GSM and its allied data technologies such as SMS, GPRS, EDGE and HSPA have led to the demise of CDMA in Nigeria. This is due to the continuous roll-out by operators and their perpetual marketing drives for customer acquisition which has led to the 90 million plus subscribers we see in the country today.

As an industry player, what is the possible cost of running access network using alternative means by telephone operators in Nigeria?

The cost of running an access network is dependent on quite a number of variables. The first is obviously the kind of access technology your base transceiver stations (BTS) use which could be GSM including GPRS, EDGE and HSPA, CDMA including EVDO, Wimax and the new LTE.

Each of these will have varying costs associated to them including power, maintenance and support. Then you have the cost of the physical location of the BTS which nowadays is moving increasingly towards the use of co-location providers such as Helios Towers, IHS and SWAP. Rental of these sites will vary dependent on location, space requirements, if you are placing your equipment indoor or outdoor and what height on their mast or tower you place your radio antennas.

Building masts and towers

If however like some operators you build your own masts and towers you would have to add to your costs the land and building costs associated with the mast or tower and of course the obligatory acquisition of AC and DC power sources such as generators and rectifiers.

You also have the transmission and backhauling to contend with which dependent on your approach could be bought services attracting operational expenditure or capital expenditure layout if you are deploying your own. The costs of this will also vary dependent on if you choose fibre, microwave or an alternative technology such as laser.

So as you can see it’s not a straightforward assessment of costs especially as it will also vary dependent on the market the operator is addressing both geographically and demographically speaking.

What are your expansion plans for the next five years?

We began our deployment in Lagos and have achieved close to 100% coverage of the state. From the first quarter of 2012 we plan to announce roll-out to four other cities. Hopefully by 2013, we should have national coverage of all key cities.

Long Term Evolution technology appears to be maturing around the world. What is the company’s plan to migrate its customers to this technology?

We recognize that LTE is the future and we have deployed an LTE-ready network though we are doing WiMAX today. We have a well-defined migration plan which is tied to the global timeline for the commercial availability of customer devices that can support this technology. With the global trend, this transition will be sooner than you think and I can assure you that we at Mobitel are already set for it.

What are your major challenges?

Our major challenge has been power which is said to be a top three OPEX (operating expenditure) item for most operators globally, and frequently the top item for many African and South East Asian operators. The cost of running the access network especially using alternative means is expensive and makes deployment especially to rural areas, where 60% of the population resides, quite unattractive.

Coupled with this is funding. Government is not funding broadband services projects as you find in some other countries and securing funding through commercials banks takes time and comes with attendant high interest rates.