Telecom

Operational Challenges Forcing Managed Services on Operators

Published

14 years ago

May 31, 2010

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Telecommunications operators are today faced with a lot of challenges that have made the business not rosy as it used to be some few years ago.
Although, some may look at the situation as fallout of recent economic meltdown and reform in the banking sector which affected the spending habit of ordinary Nigerians who use telecommunications services thereby reducing Average Revenue Per User of operators.
More so, operators are constantly faced with vandalization and theft of their equipment. All the operators both Global System for Mobile communications (GSM) and Code Division Multiple Access (CDMA) have had fair share of theft of their equipment, it was reported sometime that GSM operators losses an average of four generators on daily bases which approximately means that a total of 12 generators are lost everyday. This excluded Etisalat which does not have as much base stations as the Globacom, MTN and Zain, they are still experiencing theft of their equipment as well.
Other operators such as CDMA report lost of their generators at an average of one generator daily. This situation has continued unabated which has forced operators to seek a way of addressing this problem.
Nay, the operating environment in the telecommunications space of the country’s economy has continued to give operators sleepless night. The Association of Licensed Telecommunications Operator of Nigeria (Alton) recently sought the intervention of the Joint Tax Board on the burden of multiple taxation imposed on its members by the three tiers of government. Speaking at an interactive session with the board in Abuja, Mr. Gbenga Adebayo, the chairman of Alton, urged the board to be concise on the type of taxes stipulated by law, which the companies should pay.
He said; “Alton, once again, brings to the attention of the JTB, persistent attempts by certain states and local government authorities to impose multiple and unjustifiable taxes and levies on our members in their respective jurisdictions. This development threatens the laudable efforts of our members to make further substantial investments on their respective networks and provide world class telecommunications services in Nigeria. Alton respectfully seeks the intervention of JTB in addressing the issue of multiple taxation.”
Adebayo noted that when the members refused to pay the levies, the affected states and local authorities resort to closure of their facilities and infrastructure.
This, according to him, has adversely impacted on the network availability, quality of service and finances of member companies.
He alleged that the policemen and thugs, who complement the drive of the multiple tax imposers, made it difficult to resist them.
Adebayo cited an instance where one state demanded N200m as advert levies, and another local government was demanding N18.6m each year as operation levy, office location permit, development levy and ground rent from 2002 to 2009.
“Unfortunately, and contrary to all known norms, these local authorities utilise the services of the police and thugs to drive their demand; making it difficult and, most times, impossible to engage them meaningfully,” he said.
In view of these challenges which have increased cost of doing business in the country, as well as competition which is gradually defining the direction operators should go in service delivery, that operators are been forced to consider managed services as a way out of this quagmire.
Managed service otherwise known as outsourcing, in literal means sourcing from outside. The term is increasingly used to refer to sub-contracting of a set of functions or processes by one firm to another, or to a group of individuals, whose competent is in the area of which it is to manage.
Managed services are being pursued as an active business strategy in the current economic scenario, since it enables an operator to focus on core-competency areas. It also frees the operator from resources and labour intensive functions, which are now performed by trained personnel at much lower costs.
The processes or activities that are being outsourced could range from customer service and telemarketing to IT management, software development, market research and even financial portfolio management. Telecom players are leaving the technology-related aspects of their business to external consultants as they focus upon providing new services to their customers.
How it started
When operators in the space, be they global system for mobile communications (GSM) or code division multiple access (CDMA) rolled out service over eight years ago after the liberalization policy of the government, little did they realize that their service believed to be a source of joy and enhancement of the people’s social economic life will be a subject of attack by miscreant, armed robbers and communities. Operators who envisaged that the major challenge they are likely to face in doing business in the country is energy problem are now faced with other challenges that were never thought of. Such issues include, vandalization of operators installed equipment- there has been several cases of operators equipment being vandalized by host communities and government contractors.
Although telcos have adopted managed services option in many other areas of their operations, but the most innovative is the offer Ericsson and Aviat to extend the initiative to management of base stations. This is not different from co-location of site being offered by telecommunications infrastructure building companies such as Helios Towers, IHS, Mti, among others. In the Zain and Ericsson deal, the mobile telecommunications operator, awarded to Ericsson a five year network management contract of its GSM/WCDMA networks, and business support systems. Under the agreement, Ericsson is now responsible for the network operations, field operations including optimization, third-party vendor management for Zain’s GSM/WCDMA networks, and business support systems.
Ericsson is now serving more than 4,000 sites across Nigeria on behalf of Zain. As part of the agreement, about 450 employees are being transferred under their existing terms and conditions of service, from Zain to Ericsson, where they will undergo further training in the latest wireless technologies.
Nigeria CommunicationsWeek gathered that such agreement is going to be the hallmark of business model of new owners of Zain, Bharti Airtel. This is sequel to revelation that the company is an expert in outsourcing, having outsourced over 90 percent of its services that are not core to its operation in India it parent country.
MTN also entered into agreement with Communications Network Support Services (CNSS) to manage and operate its wired line services which the company has competent in.
Nigeria CommunicationsWeek investigations also revealed that telecommunications operators have began move to sale their cell sites to infrastructure sharing operators. It was gathered that the sale of their cell sites is part of effort to reduce capital expenditure in view of dwindling Average Revenue Per Use (ARPU) of telecommunications operators.
Nigeria CommunicationsWeek investigations also revealed that operators are going beyond managed services option for their base stations to outright sale of existing base stations. It was gathered that one of the major Global System for Mobile communications (GSM) operator has finalized agreement with a telecommunications infrastructure building company to sale over 70 percent of its existing base stations in the country. Equipment that are being sold in such agreements are steel towers, generators, and land value. Operators retain the ownership of their transmission equipment as the buyer of those sites turn them to co-location site for several users and manage them.
Although outsourcing by telcos of their network management is relatively new, a typical network management comprises of 50 to 55 percent of the cost of a telco’s operations. System integrators expect this segment to be among the largest segments that could be outsourced to a third-party.
With the proliferation of technology, and increased competition, telecom operators are looking at partners who can help them reduce cost of doing business and in turn enhance customer satisfaction. The operators will then have sufficient time to focus upon their core aspects of their business and plan for strategic initiatives geared towards improved service delivery, rather than thinking about how to replace stolen generator or refilling diesel tanks or proving security at base stations.
However, companies such as Swap Technologies, IHS Plc, Helios Towers, Mti, CV Comm. among others have positioned themselves to offer managed services to telecom operators. They have already started offering the service to some operators while discussions are going on with many which will see by the end of the year 80 percent of telecom operators’ base stations being managed by third-party, in this case licensed telecom infrastructure provider.
Bayo Banjo, managing director, Disc Communications, agreed that outsourcing of network management by telecom operators is a good idea. He cited example of Virgin the second largest telecom operator in the United Kingdom, which does not have a single cell site. He expressed worry over the ability of the initiative to curb the problem of vandalization of telecom equipment.
Banjo added that outsourcing of network management became necessary in view of shortage of qualified telecom engineers to maintain networks as well as corruption which has left operators with the option of outsourcing. This according to him needs to be urgently addressed as it may jeopardize the growth being recorded in the sector which is battling with poor quality of service.

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Telecom

Nigeria May Re-introduce Telecom Tax to Obtain new $750m World Bank Loan

Published

20 hours ago

May 7, 2024

Comms Week

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Nigeria may reinstate a previously suspended telecom tax and other fiscal measures as it seeks to secure a new $750 million loan from the World Bank, as per Nairametrics report.

This is according to the Stakeholder Engagement Plan for Nigeria – Accelerating Resource Mobilisation Reforms (ARMOR) P-For-R (P177308) program dated March 2024, between Nigeria and the World Bank.

A copy of the plan’s document was obtained and seen by Nairametrics suggest the government reintroduces the excises on telecom services, EMT levy on electronic money transfers through the Nigerian Banking System among other taxes.

President Bola Tinubu in July 2023 ordered the suspension of the 5% excise duty on telecommunications and the Import Tax Adjustment levy on certain vehicles.

However, it appears that this suspension may be lifted to meet the program targets for a new, yet-to-be-approved World Bank loan.

Nairametrics has confirmed that negotiations are ongoing between the Federal Government and the World Bank.

The program’s development objective is to strengthen the government’s financial position by enhancing its capacity to manage and mobilize domestic resources effectively, which includes improving tax and customs compliance and protecting oil revenues.

Affected stakeholders and sectors

The planned tax reforms under the ARMOR program are expected to have significant implications across various economic sectors.

According to the plan, affected stakeholders will include manufacturers of goods such as alcoholic beverages, tobacco products, and sugar-sweetened beverages (SSBs), telecom and banking service providers, as well as the general tax-paying public.

Importers and international traders will also feel the impact of these new fiscal policies.

Key industry groups such as the Association of Licensed Telecom Operators of Nigeria (ALTON) are engaged regarding the excise duties on telecom services.

The banking sector, represented by the Committee of Bankers, are engaged regarding the introduction of an Electronic Money Transfer (EMT) levy on transactions processed through Nigerian banks.

Additionally, the Manufacturers Association of Nigeria (MAN) will play a crucial role, particularly for those involved in producing targeted products such as tobacco and alcoholic beverages.

The plan document read:

“Domestic Revenue Mobilisation drive in the government ARMOR program seeks to increase revenue on some targeted industries and sectors of the economy. Specific groups and agencies within affected sectors include

“1. Association of Licensed Telecom Operators of Nigeria: The introduction of excises on telecom services requires that all telcos are mobilised to fully participate in the collection of such revenue.

“2. Committee of Bankers: Introduction of EMT levy on electronic money transfers through the Nigerian Banking System would need the buy-in all banking institutions

“3. Manufacturer’s Association of Nigeria: Manufacturers of tobacco products, sugar sweetened beverages(SSBs) and alcoholic beverages who would be required to collect excises on their products are critical stakeholders for the introduction of the new excise regime. They are currently organised into various sectoral groups under the Manufacturer’s Association of Nigeria (MAN). Producers of alcoholic beverages organised under the Distillers and Blenders Association of Nigeria also need to key into the reforms

“4. Importers: Strategic partners involved in importation of different items into the country will be mobilised to participate in the ARMOR program. A key stakeholder group is the Association of Nigeria Customs Agents (ANCLA).

“5. Vehicle Importers and Manufacturers: Stakeholders in the automobile trade industry must be engaged on reforms involving the introduction of green taxes on high GHG emission vehicles. Local manufacturing and assembly of vehicles is growing through a phase of growth in Nigeria. The demand for vehicles is mostly met through importation by vehicle importers under the aegis of Association of Motor Dealers of Nigeria (AMDON).”

The document also emphasized the importance of engaging vulnerable groups to ensure they are not disproportionately affected by these changes.

It also said:

“Services that will be subjected to the newly introduced excises are regulated by key public sector agencies. The introduction of the new revenue measures will require the application of existing regulatory mechanisms available within these institutions. The concerned institutions include

“1. Nigerian Communication Commission

“2. Central Bank of Nigeria.

“There are also agencies with the mandate for making policies on some of the issues covered in the ARMOR program with respect to policy framework on matters of public interest in Health and Environmental Protection. The government institutions relevant to ARMOR in this regard are.

“1. Federal Ministry of Environment

“2. National Environmental Standards Regulatory and Enforcement Agency (NESREA)

“3. Federal Ministry of Health”

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Telecom

Google and African Union Partner to Launch #DiscoverMyAfrica

Published

23 hours ago

May 7, 2024

Ugo Onwuaso

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The Office of the African Union Chairperson’s Youth Envoy and Google today announced the launch of the #DiscoverMyAfrica Shorts Challenge, a month-long initiative to celebrate the rich diversity, heritage, and vibrant spirit of the African continent. Throughout May, YouTube creators across Africa are invited to share short videos capturing their unique perspectives, using the hashtag #DiscoverMyAfrica.

“#DiscoverMyAfrica empowers African youth to share their stories and rich cultural heritage globally,” said Chido Mpemba, African Union Chairperson’s Youth Envoy. “Partnering with Google fosters creative expression and dialogue on content responsibility, digital preservation, and AI’s impact on Africa’s creative industries. This aligns with our vision for a digitally-enabled Africa harnessing cultural wealth for economic growth and social progress.”

The YouTube Shorts Challenge encourages creators to showcase various facets of African life, from music and art to food, fashion, and local landmarks. To further celebrate Africa’s vibrant music scene, YouTube is turning up the energy with YouTube Music Nights in Nigeria and South Africa, showcasing the infectious rhythms of Afrobeats and Amapiano. Two dedicated playlists, “Africa’s Next Wave” and “Africa Superstars,” will highlight both emerging talent and iconic voices that have made the continent a global music powerhouse.

Nollywood superstar and style icon Osas Ighodaro will immerse viewers in the luxurious side of Lagos with her new show “Spa with Osas.” Enioluwa and The Geng will unravel the drama and secrets of high school elites in their highly anticipated series “All of Us.” And comedy superstar Broda Shaggi is guaranteed to bring the laughs with his hilarious new project, “Shaggi’s Palava.” These exciting new shows will premiere exclusively on YouTube.

Aspiring filmmakers and content creators can also take advantage of specialized workshops designed to hone their skills and expand their reach. A dedicated Nollywood workshop in Nigeria, and broader #DiscoverMyAfrica workshops for content creators will offer valuable insights and resources to creators at all levels.

“We are committed to supporting the diverse voices and talents that make up Africa’s creative landscape,” said Addy Awofisayo, Head of Music for Sub-Saharan Africa at YouTube.

“These initiatives provide valuable resources and platforms for African filmmakers, musicians, and content creators to share their stories and connect with global audiences.”

To learn more about #DiscoverMyAfrica and how to get involved, visit www.blog.google/africa or follow #DiscoverMyAfrica on social media.

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Telecom

QNET Triumphs as it Scoops Three Prestigious Awards @ PR Awards 2024

Published

23 hours ago

May 7, 2024

Ugo Onwuaso

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In a remarkable acknowledgment of its excellence in public relations and communications, QNET, a leading lifestyle and wellness direct selling company, proudly announces its victory in three distinguished categories at the 11th annual PR Awards. Demonstrating its prowess in crisis management, corporate strategy, and technological innovation, QNET is setting new standards for excellence in Direct Selling.

This year, QNET was honoured with the following recognitions:

Silver Award for Best Corporate Strategy – An endorsement for QNET’s Fingreen financial literacy programme that has been rolled out in three countries over the last 18 months and has helped over 7000 people, including college students, home makers, street vendors, and female small traders, with the tools they need to take charge of their financial future.

Silver Award for Best Use of Technology – An important recognition for QNET’s QBuzz Blog, an innovative platform that leverages technology to foster community engagement and provide insightful company and industry content.

Bronze Award for Best Crisis Management Strategy – Celebrating the success of the “Truth About QNET” campaign, which effectively navigated the company through challenging times with transparency and integrity.

The PR Awards, renowned for highlighting the best in the PR and communications sector across South Asia, Southeast Asia, and Oceania, saw entries from the most prominent brands and organisations in the region. An independent panel of senior industry experts from leading brands selected this year’s winners, underscoring the credibility and prestige of the awards.

Trevor Kuna, Chief Transformation & Reputation Officer at QNET, expressed his enthusiasm: “We are profoundly honored by the recognition at the PR Awards 2024, which reflects our unwavering dedication to excellence, innovative strategies, and our commitment to providing outstanding value to our customers.

“These awards are a testament to the hard work and ingenuity of our team, and they motivate us to continue setting new benchmarks in the industry.”

QNET’s success at the PR Awards is not just a celebration of its achievements but also a promise to its stakeholders of its dedication to excellence and innovation. As the company looks forward to future challenges and opportunities, it remains committed to upholding the highest standards of quality and service in the industry.

For more information about QNET and its achievements, please visit QNET’s website.

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