Abass: We Will Spend over $1bn on Rollout in the Next Four Years

The Chief Executive Officer of ntel, Mr. Kamar Abass, has unveiled the company’s rollout plan after its acquisition of NITEL and MTel. Emma Okonji presents the excerpts:

There has been so much hype about your rollout plan. When exactly is ntel rolling out its services to the public and what are the preparations on ground?

The first phase rollout with the commercial sales of our 0804 mobile line began on April 8 in Lagos and Abuja. But we are rolling out physical sites across the coverage areas in Lagos, Abuja and Port Harcourt, and we are rolling out the sites on 900GHz and 1800GHz spectrums, with 4G LTE Advanced technology. That will enable us offer four broad category of services, which include VoLTE; crystal clear high definition voice; better battery life experience on the system, and this helps to preserve the battery life of the mobile phones that customers will use on our network; and less overlap technology that will boost capacities on the Base Transceiver Stations (BTS), also known as base stations.

Our services will include better video experience when customers are downloading and watching videos on their mobile phones. To achieve all of these, we have acquired over 800 base transceiver stations, spread across the country from the old NITEL, and we have also entered partnership agreement with IHS and Helios Towers, builders of BTS and other telecoms infrastructure, to roll out 600 base stations for the commercial rollout in Lagos and Abuja, with plans to extend the rollout plan to Port Harcourt with additional 200 BTS.

Has ntel gotten approval from the regulatory body for the planned rollout?

The Nigerian Communications Commission (NCC), the telecommunications industry regulator, has approved all licence authorisations necessary for ntel to launch its Voice over LTE (VoLTE) network using next generation telecommunications infrastructure, for its first phase rollout in April.
So we are ready for rollout and we will double the speed of mobile broadband in order to offer better customer experience. So from April 8, 2016, we will begin commercial sales of our 0804 lines and our customers will have access to our network, beginning from that day.

We have rolled out enough BTS in Lagos and Abuja that will enable customers access our network, beginning from April 8. It is a gradual rollout process and it will continue in the next three to four years without having a break, because our target is to offer customers the best of services.

Some time ago, ntel had some regulatory issues with NCC. Have the issues been resolved?

The report that ntel had regulatory issues with NCC is inaccurate. We have been working with the NCC to get all the regulatory approvals that we need, and we have gotten every clearance from the NCC to launch our services. We have had good dialogue with the NCC and I found that dialogue as the best engagement anywhere in the world, between the operator and the regulator.

Is fixed line service offering part of your rollout plan?

Yes, fixed line service is part of our rollout plan, and we are already selling fixed lines service to our enterprise customers that have their offices close to our metro fibre network and this is the best practical thing to do. So in order to maintain data on our network, we need a lot of fibre and that exactly drove us to build a metro fibre network in Lagos, Abuja and Port Harcourt and this has given us a solid beginning with our service rollout. Fibre network is fixed and it is also mobile. So we are also rolling out our fixed line service, alongside our mobile broadband service, which is part of our licence.

As the fifth GSM company into the Nigerian telecoms space, how do you intend to cope with competition from existing GSM operators?

If people understand what we want to do in the Nigerian telecoms space and what we are already doing, they will not doubt our survivability in the Nigerian telecoms market. The truth is that the demand for telecoms services globally will always be underestimated, and there will always be underestimation in the transition that is occurring in the telecoms industry. We are beginning to see a tremendous shift in the telecoms sector and this paradigm shift is unstoppable, and the shift is from a voice oriented communication market to a market that will be dominated by data and mobile broadband.

So what this means is that there are huge opportunities in the Nigerian telecoms market for any operator to exist and survive in business.
So there should be no worries about our late entrance into the Nigerian telecoms space because the growth rate is high and the demand for telecoms services, especially mobile broadband service will be high enough to accommodate more players that will even come after ntel.

Having entered into the Nigerian telecoms market, what does ntel intend to spend for the initial service rollout?

Our forecast is to spend over $1 billion in the next four years to give Nigerians quality telecoms service and Voice over Long Term Evolution (VoLTE) service that will ride on our 4G LTE Advanced technology network.
Looking at what we have done to date in order to achieve all of these, is quite amazing. As of today, we have laid nearly 200km of metro fibre in Lagos, Abuja and Port Harcourt. We have acquire a fourth generation long term evolution (4G LTE) core advanced network and we have also added other elements that will facilitate seamless operations in our own 4G LTE advanced technology network.

We have acquired a total of nearly 1,000 cell sites that are in the process of being rolled out. These are cell sites that will enjoy two advanced technology features, which are the carrier aggregation on the 900 and 1800 spectrums, plus 4/4 multi antennae technology that allows us to boost network coverage and customer experience.
So we are doing a great deal already to ensure that from a technology standpoint, we are the most advanced network in Nigeria.

How do you intend to raise the $1 billion for the rollout?

We are currently speaking to investors and those who believe in our dreams and vision are beginning to respond. Some of them are foreign investors that are still willing to invest in Africa. We are quite happy with the level of funding we are already getting, even though most investors over estimate the risk in investing their money in Nigeria. But we believe that when investors see what we have done in terms of rollout, they will be willing to invest in the ntel business.

What were your fears about the federal government’s initial plan to reverse the sale of NITEL/MTel, and what could have been the effect on foreign investors?

When the federal government, through the House of Representatives was calling for the reversal of the sale of NITEL/MTel, we had the opportunity to speak to them and they were satisfied.
Permit me to take this discussion from the NITEL and MTel debt, after ntel acquired them, which was about $350 billion debt. And at the time the ntel deal was announced, the debt was about $2 billion and the company was liquidated in 2008, but those debts persisted. When the guided liquidation of NITEL/MTel was announced, all the proceeds from the $2 billion, went to the creditors. We paid $252.3 million, which also went to the creditors. The problem is not in the amount of money paid to acquire NITEL/MTel, but the amount of money it will take to turn it around.

What are the envisaged challenges in the course of maintaining these advanced technology that ntel will be rolling out?

No doubt, our challenge will be on how to maintain the advanced technology network that we have and that is why we are building and shaping our business to be able to maintain the extremely high quality from our network. We are already rolling out a good number of BTS, to enable us have better 3G and 4G coverage on our network. All these are to provide great customer experience.

You talked about 4G LTE Advanced network. What is the difference between it and the 4G LTE network?

The difference is that there are lots of features that could be added to 4G LTE that will qualify a network to be 4G LTE Advanced. What we have done to achieve 4G LTE Advanced network is to use carrier aggregation technology to bond together, the spectrum and make the spectrum to operate more uniformly and more efficiently. The second thing is that the aggregation has allowed us to introduce additional features on the network and this is significant in engineering terms because it allows us as operator, to give better coverage on the 900GHz and 1800GHz spectrum bands. Again we are using multi antennae, whereby we have up to four antennae transmitting signals and additional four antennae receiving signals and this doubles performance and efficiency. All these make up for the 4G LTE Advanced that I am talking about.

Prior to your launch date, ntel had earlier called on intending customers to register for reserved lines. What is the registered figure so far?

We will not want to publicly announce the number of customers that have been registered for the reserved 0804 lines, but I can confidently say that the number is in tens of thousands.

What should subscribers expect from ntel in the area of cost data?

We are not in a position to fix the cost of data for subscribers, but the truth is that when quality data services are being offered to customers, they will be willing to pay for the cost. Mind you, there will be no fixed rate for data services across board. Prices will depend on the type of service that the customer wants. But in terms of pricing, we will offer good value for money and for excellent services. It is not about cheaper prices, but about great and excellent services.

So which segment of the market will ntel be targeting. The low-end or high-end customers?

I have told you earlier that there will be tremendous growth in the number of mobile broadband customers from 35 million to 200 million by the year 2020, and what this means is that there is a mass market for data in the Nigerian market and this is not about targeting the high-end or low-end customers.
Today the internet market in Nigeria is fast growing because of the massive market, and this is applicable to our data service offering. So what we will do is to sell the mass market proposition rather than the elitist proposition.

Why did ntel decide to build its own Tier 111 Data Centre when we have existing operational Teir 111 Data Centres in Nigeria, that were built by some operators?

The reality is that we did not set out to build Tier 111 Data Centre. What we set out to do was to give our customers excellent data service, and we are passionate about delivering on our promise. Yes there are existing Tier 111 Data Centres in the country, but we discovered that none of them is offering what it takes to give our customers unique and better service experience. So in order not to compromise on our promise of delivering excellent service, we decided to build our own in-house data centre that will meet our standard. Yes we spent so much in building our Tier 111 Data Centre, but it will help us to serve our customers better. This is just one out of the several data centres that we intend to build. As our customer base increases, we will need additional data centres to drive our operations.

So what makes the ntel Tier 111 Data Centre different from other existing ones?

It is collocated with the cable landing, which makes it a self data centre that cannot be outsourced to a third party simply because we do not want another business owner to run another business alongside our cable landing station. So it was good we have a Tier 111 Data Centre in-house to meet the needs of our customers.

What arrangements do you have with channel partners in preparation for rollout?

We have finalised every arrangement with our channel partners for rollout. We have engaged channel partners that work for existing telecoms companies and we are currently putting finishing touches to the branding aspect of our business. Stalls, vehicles, merchandising materials are all ready for our rollout.

Telecoms subscribers over the years have been groaning under poor service delivery, which include incessant call drops, which they are eventually charged for. How do you intend to address this issue when ntel eventually rollout its services?

We are coming out with advanced technology, the VoLTE, which offers clear voice transmission and our 4G LTE Advanced technology will enable customers to download videos and watch them on their mobile phones, while on the go. So the issue of drop calls will be eliminated and customers will get better experience. The issue of billing subscribers for drop calls is a thing of policy and regulation, which I think the NCC should address.
So when it comes to promises made, we must make sure we meet our promises and also compensate customers adequately, if we have course to fail in our promises.

How is the current dwindling exchange rate likely going to affect your business, and what are your plans to carry along local companies and the pension institute in your business plan?

It is true that the unstable exchange rate is giving some business owners some sleepless nights, in terms of their return on investments, but I think return on investments for businesses in Nigeria is solid. The earlier we remove our minds from exchange rates, the better it will be for our business growth. For the local companies, we are already talking with them, and as for the insurance companies, our doors are open to any of them that is willing to do business with us.

Do you have plans to list the ntel business on the Nigerian Stock Exchange in the near future?

We are proudly Nigerian company and we will do whatever it will take to enable us succeed in the Nigerian market. Listing on the stock exchange is a future investment and we hope to do so in the future and not in the short term. So we will consider doing that in the future.

You appear so confident in the telecoms business ahead of you. What gives you this confidence?

We are confident because we have built the right technology, we have developed the right crop of staff over the years and we have better timing for business, and our investments are huge. The latest technology that we are bringing, also makes us confident. We are entering the market when there is a shift from voice to mobile broadband, which is our core service delivery.

NCC recently released a memorandum for the auction of 2.6GHz spectrum band that will drive broadband deployment across the country. Is ntel interested in acquiring the spectrum?

We are aware of the planned sale of the 2.6GHz spectrum and we see it as an interesting opportunity and we are considering it, because we know that the 2.6GHz spectrum is useful for hotspot coverage, even though it is not viable for wide area mass market coverage. So we will consider it for hotspot coverage within our massive coverage areas.