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Smaller Operators Necessary for Telecom Growth – Banjo

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Engineer Bayo Banjo is the CEO of Disc Communications Limited, a telecommunications company and the outgoing first vice president of the Association of Telecommunications Companies of Nigeria (Atcon). He spoke to funmi ilesanmi on how the success of the telecommunications space hinges on good regulatory policy, strict penalties, need for compliance to be enforced and other industry issues.

Bridging the Digital Divide
First is good regulatory policy and I think that really is the issue. Whether we like it or not, like I’ve always said, for broadband to exist, for it to be available to all, one thing is very essential, it means it has to be cheap. Right now, you can get broadband if you want
but you pay an arm and a leg. If everybody could afford let’s say N300,000 a month, everybody in Nigeria can get broadband now either they get it from satellite or from whatever. The issue then is to have cheap broadband and the consequence of cheap broadband is that new set of telecommunications companies would have to realize that they will now focus their business on lower turnover per subscriber than what they see at present. I always say to people that, does it occur to regulators that they establish their voice networks. It is not in their interest for broadband to become readily available because they would still want to armourtize their investment that they have put in their voice infrastructure. From what I know, virtually all the operators have been allocated 3Megawatts frequencies, the most successful that we’ve seen is probably MTN. You can see that they all have a better Internet service but you see all of them could be doing it but why aren’t they doing it? Why aren’t they pushing it further? Okay, one could argue that they probably have to wait for the new cables to land in Nigeria so that the price of bandwidth can go down. The cables promise a reduction in call connect from $2,000 to $250, that is what would probably occur when the cables land in the next three months or so. Broadband essentially would do everything so the old voice networks like you know it would slowly collapse in a broadband environment. There are some countries, one in which I had a personal experience in Denmark where virtually the land line is vanishing to what they call Volp telephone. In that country in particular, Volp is taking over the land broadband. You must remember that people who are making huge profits with their present network would want to restrict this. Would they not want to lobby for some types of monopolies or ways to restrict entrance? The beauty about the Internet and Internet protocol is that you can provide services at any level. It is not just the issue of economies of scale, there are other issues that can be linked to a good service. The government must look at policies, the operators and the barriers that are being placed because like I said, everybody seems to want broadband so why is it not being done? All these argument of spectrum availability, I doubt its relevance. I mean 2.1 has been allocated, 2.3, 3.5 and 3 have all been allocated so the question is why aren’t these being utilized? Besides the physical reason of the cost of bandwidth being high, which would be solved in a few months, the rest I think is the attitude by big companies to enter it because it means probably a lower profit margin.
Quality of Service                         
The quality of service is terrible and we have to blame the regulator for that because it is only up to the government in any society to protect the interest of the consumers. The bad thing about private enterprise is that it is focused on profit. When a private company says it is there to make customers happy, they are doing it because that may translate into profits. You could make profits and your customers are dissatisfied and that is why we have the consumer protection agencies but the main thing is that the government should take this into account. What we must realise is that with any phenomenon whatever it is, there are people who benefit and there are people who don’t. Any situation in life can be interpreted in the negative or in the positive. For instance, if a philanthropist was to donate N1billion worth of drugs to let’s say a state government, the people will be happy, the health minister might not be because that would probably be deducted from his budget. A good thing may be bad to some people but I find it strange how we pat ourselves on the back and say we have 70 million phones. Yet I ask most people, how many phones they have. I found that even the lower level strata of the society have a minimum of two phones, the higher level is four so do we really have 70 million subscribers or should we halve that amount? But the consequence of this is this, due to lapses in regulation that have allowed operators to either have apathy concerning interconnect or whether it is sabotage or anti-trust violations, they have forced consumers to  buy more than one  phone. If you looked at it that way, it is a failure that to adequately communicate in Nigeria, you need to have different phones for different networks. But instead, we praise ourselves and say we have 70 million phones while in advanced countries, I bet if you have two phones, one would be a private line and another for business so why do we need more than that? Why should the government brag that we have 70 million phones, is it not the private sector that invested and marketed? If we must ask that maybe the private sector itself is encouraging poor quality of service so people can buy more phones because this phenomenon is known no where else in the world. People don’t carry four phones around in America, it doesn’t exist so why is it here, why isn’t the phenomenon in Ghana? Let’s take away the developed world, let’s come back to Africa. People in Ghana don’t carry three or four phones. The telecom revolution here is like the government had us all locked up in a cage and allowed only Nitel to function. Now they have opened the cage and we left the cage then flourished and the government wants to take credit for that flourishing? Take credit for just opening the cage and allow business to be done.
Broadband and Crime
The first thing that needs to be done is that our laws need to be amended, changed and additions made to them to deal with this new phenomenon. There also has to be a form of awareness to the judiciary. Are there no judiciary yet able to understand evidence or take evidence that is in the cyber world. It is best for us to make these laws and statutes now before broadband arrives. The problem we have is that we have a unique situation where we cannot compare ourselves security wise to the rest of the world so we may need to have our own very innovative laws. For instance, in most other countries, they have other support security mechanisms. In the UK or the US, you cannot just build a tall building without explaining where you got the money from. Here many people are not prosecuted after the money has been recovered; they don’t send them to jail so the message being delivered in Nigeria is that the real crime is getting caught not in committing the crime. People who use computers on a very large scale particularly the banks commit crimes internally while abroad, they concentrate on preventing hackers from entering a system and becoming a nuisance. Here, the problem is not going to be that, the problem is that the people in-house. The people running the company are the ones committing the crime so we have to find a way to deal with that. How do we deal with that in a society where people are not asked to account for their wealth? Our situation is like let everybody in Nigeria carry guns, you can imagine the chaos that might occur because we do not have a proper registration of actual human beings so crimes can be committed. In America, everyone could carry a gun but there is adequate security to monitor the population. Now we are going to open the Internet when broadband comes and we need adequate policies and adequate laws to deal with the crimes that would follow.
About Disc Communications  
Disc Communications had a broadcast outfit from which we broadcast cable channels. We are now moving into broadband provisioning or bandwidth provision because vandalism on our external land plants have technically overwhelmed us so we are moving more into sale of Internet broadband  services.
Number Portability
Nigeria is ripe for number portability. In a country where regulators are unable to enforce anti-trust issues and is unable to solve this kind of behaviour, number portability is good. Why do you carry three of four phones? If MTN service is bad for this week, you switch over to Glo, you still have same access; you still have the same number. It also allows smaller companies to come up because that is a company that would concentrate in Abeokuta and still give fantastic service and everybody jumps on their network when they go to Abeokuta. It would increase quality of service and allow for innovation. The only draw back is that since we depend on the actual company to allow their numbers be transferred to another network, we then have another anti-trust or sabotage issue. Can we really police that company to make sure it allows its number to be transferred to another network? So we are still back to the same issue that the regulator must give strict penalties and what I think the regulator lacks is that they need the law to go  after individuals like what obtains in the banking industry. What happened was that the CBN do not look at the bank, they went after the individual involved. The same thing should happen in telecom. We should not have a situation where the NCC issues a letter or directive to telecom companies and the CEO ignored it because as far as he is concerned, he knows they cannot sue his company. What’s his business, what fine is he going to give them, N10 million, N100 million? They make N10 million in a few seconds so is that a fine? But when you tell the CEO that we will ban you from the industry, we will remove you if you don’t follow our instructions. Then we are on the path to having a regulator that can impose proper sanctions and maintain sanity.
Survival of smaller operators
If we do not have smaller operators, we are doomed and this is something we must understand. People at the NCC say economics of scale and so on and they are not digging into the business module and then I said to them that the biggest companies in the US now who are in the ICT sector, what is their origin? Microsoft, a garage; Google, a garage, Apple, a garage; Youtube, all of them a garage. How did they all start? Two guys got together and they are doing something. What we are going through now is the dreaded situation of corporate monopoly, a kind of cartel. We need to encourage smaller operators because it is smaller operators that bring about innovations  

 

 

 


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FG Offers to Support TStv to Relaunch with Pay per View Model

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National Broadcasting Commission (NBC) has pledged to give necessary support to TStv Africa as the indigenous digital satellite TV service begins full operation with pay per view model on October 1, 2020.

FG Offers to Support TStv to Relaunch with Pay per View Model

Professor Armstrong Idachaba, acting director-general of NBC, made the promise on Monday in Abuja when the management team of TStv paid him an official visit.

The visit was to inform him of the company‘s readiness to commence full operation across the country on October 1.

TStv Africa is a wholly-owned Nigerian innovative multi-channel outfit which had promised to operate a pay per view model for the benefit of Nigerians.

Idachaba said: “We promise on our side that we will continue to support you.

“At this time, I think that the major issue confronting the PayTv sector is the area of giving Nigerians option of deregulating purchasing capacity in terms of pay as you go concept.

“We believe this will give you the visibility if you remain committed to the idea.

“We welcome that option and wish that it serves as a stimulant and as a progressive index for other pay-TV operators to adopt.

“Some of them have come up with a lot of excuses why pay per view is difficult and why it is not doable.

“We want you to be the galvaniser to prove the naysayers wrong that this is doable in the interest of Nigerians.

“Once you begin and you make a success of it through increased subscription base, we are sure that others will be drawn into it as it happened in the telecommunication sector.”

Idachaba said the NBC is committed to promoting local participation in the nation’s broadcasting industry, especially in the pay-TV sector, to create jobs and provide diversity for Nigerians.

He acknowledged the challenges TStv had faced over the years and encouraged the company to remain focused.

“We are aware that it has been very challenging for you.

“All over the world dominant players will always want to remain in a dominant position.

” Those who want to survive will also have to take the courage to do so,” he said.

The Acting Director-General, however, admonished the firm to refrain from any activity that would give Nigeria a bad name.

“If you are acquiring rights, you must make sure that your rights are legitimately acquired.

“You must make sure you follow the rules of engagement strictly, study the broadcasting code strictly to have a robust future ahead of you,” he said.

Earlier, Dr Echefu Bright, managing director and CEO of TStv, said they were at the NBC to seek the commission’s support to have a peaceful roll out on October 1.

He said the outfit also visited the NBC to officially present samples of its decoders to the commission and thank the management for its support.

Bright gave an assurance that the novel pay per view concept was sacrosanct.

“The model is what we have experimented and implemented and it works and we have done everything we need to do for it Nigerians to benefit.

“Beyond that, we have enough boxes on ground that will cover the entire country,” he said.

Bright also gave an assurance that with the Oct.1 roll out, every part of the country would be covered.

“We currently have a dealership in virtually every state in Nigeria and as I speak to you now our goods are already with them for October 1 rollout. The coverage from day one will be across Nigeria,”

On sports products, he said the firm has Laliga as well as the FA Cup and  Euro Cup 2021 rights.

 


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Why Businesses Should Take a Long-term Approach to People, Product, and Customers

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By Andrew Bourne, Region Manager, Africa, Zoho Corporation,

Business success is perceived differently today. Buzzwords like maximization, venture-backed, growth hacking, and well-conceived exit strategies (like IPOs or acquisitions) define entrepreneurial success in the current age. In a mad rush to show high quarter-on-quarter growth rates, corporate leaders have forgotten that the true value of a business is how long it stays relevant in the market and instead focus solely on transient growth spurts even if they cost profits.

Any business, no matter how big its initial success, needs to take a long-term approach if it’s to avoid being one of history’s almost-rans. This applies to every aspect of the business, including, people, products, and customers.

 

Invest in People

When you are a new company working on developing deep tech, discovering talent and retaining them is a challenge. Try to create and slowly nurture a pool of capable workers who will gain domain expertise over time. At Zoho, in order to sustain our long-term R&D efforts, we initially kept the teams small and worked with people who were committed to learn and understand the domain.

Patience is the key when you cultivate talent in-house. As people refine their skills and gain deeper domain knowledge, they gradually bring their learning to the business and build a solid offering that will stand the test of time. Ultimately, it’s the culture of experimental learning that you build which keeps you going and also motivates people to stick around for the long haul.

 

Build a product that can pivot and adapt

Equally important is to take a long-term approach to your product. You might be selling something simple today, but you need to be able to build on that. Take Amazon, for example. It started out selling books and gradually built out to become a trillion-dollar company. It hasn’t just focused on e-commerce either. Amazon Web Services (AWS), its cloud-computing division, keeps more than 40% of the internet up and running.

The lesson here is that long-term thinking isn’t just about having a product plan and sticking to it. It’s also about adapting to any future opportunities that present themselves. Whatever sector you operate in today, it will see disruptions sooner or later. If you can adapt to those changes, or find new opportunities in other sectors, you will be better placed for continued success than your competitors.

 

Keep up with customer expectations

Finally, you need to take a long-term approach to your customers. If you are constantly gaining new customers but not retaining them, you’re unlikely to see real success. Returning customers routinely spend more money on brands they’re loyal to. People are also more likely to recommend others to businesses they have had a good experience with. Simply put, it just makes business sense.

But taking a long-term focus with your customers isn’t just about the direct touch-points you have with them. Everything, including the software solutions you use, should have the customer at heart. For example, a unified tool which allows you to instantly see every interaction a customer’s had with your business (be it via voice, email, or chat), will put you in a much better position to serve them than trying to work with several different products.

Taking this long-term approach might feel overwhelming initially, but it’s much more likely to pay off than simply trying to survive from quarter to quarter. After all true success is built over time.


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CBN Pulls Rate Cut Trigger, King Dollar Returns

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By Lukman Otunuga, Senior Research Analyst at FXTM,

In a move that caught investors off-guard this week, the Central Bank of Nigeria (CBN) slashed interest rates by 100 basis points bringing the MPR to 11.5%. Given how inflation has been above target since 2015, rates were expected to remain unchanged for the rest of 2020 and possibly early 2021.

 

The question on the mind of many is whether the rate cut will achieve the desired effect by stimulating consumption and economic growth? Ongoing border closures and disruptions created by COVID-19 have pushed inflation to levels not seen since March 2018 above 13.20% while a drop in the production and price of Oil continues to rub salt into the wound. While looser monetary policy could support growth, it may come at the cost of rising inflation and weaker Naira.

 

Over the past few months, central banks across the globe have deployed unprecedented measures to defend their respective economies against the coronavirus menace. However, fiscal policy has been identified as the sharper tool with governments across the world providing a critical lifeline to keep the wheels of their respective economies rolling.

 

Outside of Nigeria, King Dollar made a return by appreciating against every single G10 currency. In times of uncertainty, everyone wants a juicy piece of the world’s most liquid currency. As coronavirus cases rise in Europe and other parts of the world, the flight to safety is likely to boost appetite for the Dollar. This is bad news for many emerging markets currencies, especially those with high Dollar-denominated debt.

 

On the commodity side, Oil prices remain heavily influenced by demand-side factors and the state of the global economy. Prices are likely to remain stuck around the $40 regions in the near term, especially If another round of possible lockdowns hit Oil demand. Looking at the technicals, WTI Crude is under pressure on the daily charts. If prices are unable to break away from the sticky $40 regions, the next key point of interest remains around $38. A weekly close above $41.50 could pave a path towards $43.


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