East African operators must get basics right
Competition in one of Africa’s most dynamic markets will allow operators to enjoy East Africa’s growth opportunities if they get the basics right, said participants at East Africa Com in Tanzania.
The mood was upbeat in Dar es Salaam, Tanzania, last week, where over 450 telecommunications executives gathered for East Africa Com, their annual event in the region. The conference and exhibition brought together the leaders of the region’s stakeholders to discuss the commercial and technology strategies to maximise growth and improve services for users. From the debates that took place over the two days, it was clear that East Africa is one of the continent’s most dynamic markets.
The message from some of the region’s major operators and investors at a plenary that opened the conference was that growth opportunities can be great in East Africa, for those who know how to grab them.
Most markets in the region experience high GDP growth, and favourable market and regulatory conditions. Host country Tanzania was presented as one of the most attractive of them, with 7% GDP growth, stable political conditions, dynamic operators and a low penetration levelwhich leaves room for growth.
After an opening address by Vitalis Olunga, Chairman of GSM Africa, Bashar Arafeh opened the keynote session. As Celtel International/Zain’s COO for the East Africa region, he explained the importance of East Africa in the group’s strategy to become a global operator.
He was followed by Dietlof Mare, CEO of Vodacom Tanzania, who described the key success factors for Vodacom’s leadership in the market: building quality networks (including 3G/HSPA and WiMAX in the main cities for corporate customers) and developing services that meet the customers’ needs (such as the M-Pesa payment service, which should be launched in Tanzania at the end of the month).
Both speakers mentioned competition and the resulting price decline as a major challenge in the markets. Mare pointed out that new players dropping prices affect long term profitability and the investment level necessary for future network deployment in a market. Arafeh, on the other hand, welcomed the entry of two new operators in Uganda. One of them, Warid Telecom, was represented by its CEO, Zul Javaid, who described its entry strategy. His key points echoed what his colleagues mentioned throughout the event: good brand positioning, good coverage and good quality of networks, as well as a great (mostly local) workforce.
Other topics discussed in the plenary were regulatory strategies, with a representative of Tanzania’s regulator TCRA describing the unified licensing process, and interconnection issues.
The second day included two parallel streams. Stream A looked at the technologies available to improve networks. The first part was dedicated to the technologies available for the provision of advanced services, with a look at GSM and its evolution (with a presentation from the UMTS Forum by Jean-Pierre Bienaimé), CDMA (with the participation of William Hearmon from the African CDMA Forum), and the opportunities created by combining technologies such as WiMAX, VSAT, and WLAN.
Speakers and participants also discussed the challenges of cost-effectively deploying networks to improve coverage. Eng Ahmed Dirie from Golis Telecommunications Company (Somalia), described the benefits and principles for outsourcing for network optimisation.
Stream B was more customer-focused, with a look at the new services to address specific segments and increase ARPU. Dylan Lennox, Managing Executive – New Technologies at Vodacom Tanzania described the services offered by the company (including internet access and data bundles).
Zantel’s Noel Herrity’s message was to keep things simple to attract a loyal customer base. Other speakers looked at the potential for services targeted at specific customer segments, such as low-end customers or those with disabilities.
More than 25 different operator companies were present at the event, with a full representation of the telecommunications value chain: GSM, CDMA, fixed-line, wireless broadband, cable and satellite operators, as well as equipment vendors, regulators, investors, consultants and more. Participants represented the region’s most dynamic markets, namely Tanzania, Kenya, Uganda and Sudan, as well as neighbouring markets like South Africa and Zambia.
- East Africa Com will take place again in 2009 on 1st and 2nd April. For more information, visit www.comworldseries.com/eafrica