Increased levels of investments in network quality and performance create sustainable competitive advantages and improved financial returns for network operators, writes BEN UZOR
Over the years, Nigeria’s telecommunications market has witnessed significant growth. The sector has grown from about 400, 000 connections eleven years ago to over 129 million active mobile subscriptions as at April 2014. Much of the milestones recorded in telecoms can be attributed to two critical factors.
The existence of a quasi-independent regulator through effective policies created the enabling environment for the industry to blossom. In addition, the tenacity of Mobile Network Operators (MNOs) in expanding their network across Nigeria, Africa’s largest economy by GDP, cannot be over-emphasised. However, the phenomenon of poor Quality of Service (QoS) in the country has continued to rub the shine off the country’s successes in telecoms service delivery. Earlier this year, industry regulator, the Nigerian Communications Commission (NCC) fined three of Nigeria’s four telecoms operators the cumulative sum of N647.5 million ($3.89 million) for missing their QoS targets for the month of January. The telecoms regulator had also directed telcos to stop the sale of new SIM (Subscriber Identity Module) cards, a move that did not sit well with them at the time.
The ban has since been lifted, but mobile operators, according to industry insiders, are lining up big budgets for network upgrades and expansion this year, hopeful that the operational bottlenecks hindering deployment of infrastructure will be resolved. Delays in Right-of-Way (RoW) approvals, vandalism, multiple taxation, regulation and lengthy timelines for site approvals have slowed down infrastructure rollouts in many parts of the country.
Telecom companies’ investments in network expansion initiatives are expected to rise by over 200 percent this year following intense regulatory pressure over the abysmal QoS being rendered to holders of Nigeria’s 120 million lines, industry insiders have said. In 2012 and 2013, telcos spent an estimated N347 billion and N979 billion, respectively, on infrastructure expansion. These figures show a 182 percent increase in network expansion spend year-on-year (y-o-y). Market observers are of the view that telecoms operators stand to benefit more from raising the investment profile for network expansion initiatives. Increased levels of investments in network quality and performance create sustainable competitive advantages and improved financial returns for network operators, according to a new study commissioned by Ericsson, Swedish telecommunications equipment manufacturer. The study however demonstrates that investments in network quality do translate into better financial returns for mobile operators, not only from a cost savings perspective but in terms of increased revenue. According to the recent report, network investments generate 5.5 percent increase in service revenues and a 6.4 percent improvement of EBITDA (Earnings Before Income Tax Depreciation and Amortisation) margin in a case of a 10 percent increase in capital expenditure for an operator in Brazil, decrease of 1 percentage point in overall churn leads to a 6.86 percent increase in service revenues.
Globacom says it remains committed to not only providing innovative services to Nigerians but offering them better and unique customer experience. When Glo launched operations in 2003, it introduced the 2.5G technology for the first time in Nigeria. This technology enabled it to offer GPRS with services such as multimedia messaging, mobile banking, BlackBerry amongst other services that other operators who operated on the 2G technology could not offer then. Glo also introduced the beautiful and environmentally friendly Palm Tree base stations. The company followed this up in 2008 with the launch of the third generation technology (3G Plus), the first company to do this in Nigeria and, indeed, West Africa. With the development, Glo is able Video Calling, High Speed Internet (HSI), Mobile TV and Video on Demand (VoD). As the firm turned 10 last year, it began a massive network expansion project with leading technology infrastructure companies Alcatel Lucent, Huawei, Ericsson and ZTE are handling several aspects of the scheme. It involved swapping of old base stations with new ones and modernisation of existing infrastructure.
The swapping of old base stations in Lagos is now 90 percent complete, leading to improved network experience for Glo subscribers. It is expected to be completed before the end of this month. Ogun State swapping is fully completed, while Edo State is about 60 percent completed. The swapping project has also started in neighbouring Delta State.
This is in addition to Abuja, Oyo state, Osun State, Akwa Ibom State, Port Harcourt and several parts of Lagos including Lekki, Ikorodu, Agbara and Otta which have also been completed. By the time the project is completed, Globacom, second national carrier, would have completely swapped old components on the network across the nation with state-of-the-art network software and hardware.
In addition, the Globacom network, according to Bisi Koleosho, head of operations of Globacom, will soon achieve its target of having 90 percent 3G coverage, the first in the industry, making it possible for Glo data subscribers across the country to experience significant service enhancement. The project is however expected to be completed by the third quarter of the year. Service improvement is already being felt in various parts of the country, and Koleosho further promises that the improvement will continue and manifest nationally by the time the project is completed.
Mohammed Jameel, group chief operating Officer of Globacom, said recently at a media interactive session held in Lagos, weekend, “having played a prominent role in the first telecom revolution in the country, Globacom is now ready to lead Nigeria into the second telecoms revolution, which will be an explosive Information Communications Technology (ICT) broadband growth across Nigeria in the next three decades. “Globacom will be the biggest player in the second telecommunication revolution in Nigeria.
“We are converting every cell site in Nigeria into broadband. Nigerians will enjoy the massive transformation on the Glo network after the expansion and modernisation exercise”, said Jameel. The project covers swapping, upgrade, and overhaul of network infrastructure, as well as building of new switches and construction of additional 4,000 km of optic fibre cable to complement the company’s existing fibre optic facility, which is among the most extensive private fibre networks in Africa. The company’s existing 10,000km optic fibre network is also being expanded with IP MPLS (Multi Protocol Label Switching) and Dense Wavelength Division Multiplexing (DWDM) network to provide capacity and route protection. It will also ensure constant (24/7) connectivity.
The massive project, according to Koleosho, also includes installation of new base stations and densification of existing ones, setting up of three new call centers in Port Harcourt, Abuja and Lagos to take care of vast increase in subscriber figures and upgrade of the radio access network which will ensure that data customers enjoy unparalleled speed and reliability. The Port Harcourt call centre is ready for commissioning.
According to Globacom, Lagos is being supplied with a sparkling brand new network that will be congestion-free with reduced call drops. “The Lagos microwave network is also getting transformed into a full IP Network geared up to meet future data requirements of the rapidly expanding state”, added Jameel.
According to him, Glo, as a brand, remains committed to offering subscribers the best in the market. The firm, he said is boosting customer experience on the network in terms of installing the best technology and lifestyle-changing products and services. As the firm rounds off the first year of its second decade of business, Globacom is scaling up the offering to its subscribers. In the last two months, several products and services have been introduced to demonstrate the firm’s commitment to subscribers. Some of the services include: User-friendly IDD packs, Glo Ringa, Multiple recharge strings, to mention a few. In another leg, Globacom is enhancing its reputation as one of the biggest voice and data carriers in Africa.
It has deepened its roaming services offering with the addition of over 100 leading network partners across the world in the last one year. Subscribers to Glo who are on the postpaid platform can enjoy seamless roaming services in almost every part of the world as Glo has interconnectivity arrangements with over 430 partners in 176 countries. Thus Glo is now the network in Nigeria with the largest international postpaid roaming footprint. Jameel noted that Glo had similarly extended its prepaid roaming to more destinations as the service is now available in most major destinations where it is partnering with over 80 leading networks.
Among operators on the African continent, Glo’s General Packet Radio Services (GPRS) roaming footprint is also one of the largest. The service which enables data roaming for mobile phones, laptops, iPads, Blackberry and android handsets is available in 115 countries comprising all major travel destinations. GPRS roaming enables the subscriber to access the value added services available on the Glo GPRS technology such as Multimedia Messaging Service (MMS) and Mobile Internet.
