Airtel Africa in it to win it says CTO
Airtel Africa plans to be the number one service provider across all fourteen countries it services on the continent.
The telecommunications operator made headlines recently after concluding infrastructure acquisition agreements with Helios Towers, as well as Rise Fund investment of US$200-million in Airtel Mobile Commerce BV (AMC BV).
Recently Airtel Africa penned an agreement with Helios Towers over passive infrastructure operations in Madagascar and Malawi, as well as an MoU for passive infrastructure assets in Chad and Gabon. The Rise Fund investment values Airtel Money at US$2.65-billion.
The developments have strengthened the company’s confidence and its determination to not only sustain its operations in 14 countries and provide services to 120 million customers across Sub-Saharan Africa, but also engage with new markets.
Group Chief Technology Officer Razvan Ungureanu joined the company in 2016 and has developed the network and helped expand operations into some of the continent’s most isolated and unconnected areas.
He told ITWeb Africa that connectivity remains an ongoing priority as Africa continues to digitise, and added that the way a customer interacts with the company for services is a key trend going forward.
He referred to the company’s mobile app and how it speaks to the needs of the digital customer as an example. This is delivered via its IT services division and supported by several technologies.
A core component of the company’s value proposition is the expansion of 2G, 3G and 4G network coverage across its footprint.
“(In) ninety-five percent of our footprint we are delivering 3G, seventy-six percent we are delivering 4G, and our plan for the next financial year is to bridge that gap and reach almost one hundred percent across all technologies,” said Ungureanu.
He is confident of the company’s ability and network strength. He claims that according to benchmarks measuring data speed, quality of service and network performance available through Facebook to telecommunication services providers, Airtel is well placed.
“Across my fourteen operations, more than fifty percent we are best in class, so basically number one …. in the worst case we are number two and we have plans in the next six months to be number one across all fourteen countries. We are not here to just fake something, we are here to win,” he added.
The main challenge with operating in Africa is the actual environment itself Ungureanu said, reflecting on the issue of power consumption and distribution as a case in point.
“Having power is a day-to-day strife… our organisation, the mobile operators organisation, has one of the biggest fuel distribution (operations) across Africa, we are the second biggest distributor of fuel after the pump station… because in order to maintain our sites and make sure they are up, because the power outages are so often, we need to deliver fuel to the power generators.”
Power is one issue but security and logistic/ geographic considerations also impact operations.
According to Ungureanu, despite these challenges, a customer can pay one US dollar in ARPU per month and still expect the same quality in service that anyone in a Western country would receive.
“Mobile is the only gateway that they have to the world and sometimes one person paying you one dollar to recharge makes a very big choice between food and reloading his mobile, so you have to respect that choice. It is a very important choice and you have to respect it, he cannot waste his money… so what we deliver for that dollar must be worth the money.”
Africa also magnifies the level of success or failure within a business’ operations, Ungureanu explained.
He said in Europe if a mistake is made and there is a drop in ARPU, it would be noticed but largely shrugged off to bad luck.
“Here if you make a mistake, you have an immediate hit. Eighty percent of our handsets are dual SIM, so if you r network is out one day, customers will immediately go to the second operator and you lose revenue for one month. Ninety-nine percent of the market is prepaid, so the volatility of the market is extremely high. So the network stability and the way that you address the market must be damn solid and you can’t afford a lot of mistakes.”
Rather than simply jump into the latest technology and revel in the many buzzwords, Airtel takes a more logical approach to innovation said Ungureanu.
It has to make business sense he explained and used 5G as an example and specifically in terms of handset penetration. “So today sixteen percent of my handsets are 4G ready and I just did a study last week of how many handsets are 5G ready and the average is 0.08, the highest percentage is 1%,”
In Nigeria, Airtel’s largest market, the company has 21 000 handsets that are 5G ready in a market comprising a 30-40 million customer network.
“So we can quickly see it is not making sense now to address the market with 5G.”
Fixed wireless access represents a very strong use case for 5G in Africa, he added.
“I believe that 5G will make sense in Africa, but not now. Another major factor is that the big majority of roll outs in Africa are basically the telcos, meaning we don’t own the tower, not only Airtel, any operator in Africa. Why? Because as I explained in the beginning, they are bringing power to the tower, a totally different business and different type of focus. So those guys that are delivering us power, they specialise in that. When I have a contract with a telco, I have some limitations. I have limitations on the weight I can put on top of the tower, I have constraints with the number of antennas and the amount of power.”
As to Africa’s telecommunications ecosystem, Ungureanu said that the focus must be on the reliability of the network and investment in the best quality infrastructure from vendors to ensure this reliability.
Network availability is critical to the bottom line, he said. “… because I pay less on maintenance and my network will be up more so I have more revenue. We are investing in more reliable vendors.”