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Telecel says massive expansion on cards

KC: Telecel’s network continues to comprise some sections, particularly in rural areas, that do not have any data coverage within the 3G areas. Why has there not been sufficient investment in this area?

JS: We have been affected like anyone else in this economy by the lack of liquidity for real investment. However, plans have been put in place now to ensure we consolidate in this area.

Economic and financial considerations mandated that we tackle the coverage issue based on real business prospects and market potential first, but our current investment programme places a high priority on improving coverage and service offering outside the major urban centres and in rural areas. It’s a matter of using our cash flow optimally.

KC: What strategy do you intend to pursue in order to revamp the company’s operations?

JS: Following the Orascom Telecom Holdings merger with Vimplecom, we are now in a very good position to leverage the local operation on many purchasing decisions as we take advantage of group supply management frameworks.
We have been able to acquire so much more for what appears like minimal investment. Thus going forward, we will make heavy use of these group supply management agreements, especially on big vendors, focusing on the immediate gains provided by the parent holding company.

KC: Some critics have argued that Telecel’s service is poor compared to other local telecommunications companies saying network congestion is a perennial challenge. This is in light of the current dollar for two lines marketing craze that has hit the streets. What is your comment on this and does Telecel have the capacity to handle the increased data traffic?

JS: Independent research and feedback from our own subscribers have indicated that we actually have the best quality network in the country. Obviously, this tends to differ across the country, but we have set very high standards for ourselves and this is our guiding principle.
Our current push to acquire more subscribers has been prefixed with the necessary upgrading on systems to ensure we have the necessary capacity to carry the additional load. The activity you see on the sales on SIM cards is actually based on one of our values that we provide value for money for everyone.
Many vendors and dealers have actually started running their own sales campaigns to take advantage of the popularity of our SIM cards.
Most of the sellers you see are some of these vendors and dealers who have realised the opportunity and are doing their own campaigns to increase their sales revenues.

KC: 3G coverage is about 50% of the network and the rest is GPRS, according to Telecel. How much is the company willing to invest in further network expansion, and any plans for the introduction of Voice Over Internet Protocol?

JS: As indicated, we have firm plans to cover all outstanding small towns and rural services centres.  We believe there is still a lot of potential in basic GSM voice telephony and we are not considering VoIP at the moment. Our decision is also based on the low PC penetration rate in the country at the moment. We prefer to create value for the majority of the citizens.

KC: What is the present situation concerning boardroom squabbles over ownership and control of the company, have these issues been amicably resolved and put to rest?

JS: First, let me note that from inception, Telecel Zimbabwe has had two and only two shareholders, Empowerment Corporation and Telecel International. We’ve known each other a long time, and we have excellent relations.
I find this frequent question rather amusing in that I’ve never heard of any family that never had some squabbles.
A lot is going on behind the scenes to ensure that issues are resolved to the satisfaction of all stakeholders. We are in contact with the appropriate regulatory and governmental authorities that have a direct interest in this. Suffice to say, our shareholders are fully committed to meeting all licence and legal requirements, and everything is being done to do so.

KC: A 55 megabytes bundle is priced at US$5 roughly 9 cents per megabyte while the largest 3 gigabytes bundle is going for US$150. In between is the 550MB and 1,25GB bundles priced at US$45 and US$85 respectively. How keenly has the market taken up this product at its present price and how justified is the pricing model?

JS: We have had a very good uptake of the data bundles. One thing that is apparent, though, is that many of our subscribers are struggling with disposable incomes.

Uptake has been very good on the low end bundles but rather thin on the high end ones, despite the good value offered.
We believe there is scope to refine the pricing but the biggest issue has been the landed price of bandwidth. As that comes down, which we believe it will, the price of the service will also come down in proportion.


Telecel to spread wings to rural areas, promises more base stations


KC: How much has the company set aside for expenditure in upgrade of infrastructure, specifically in rural areas?

JS: We have plans to roll out about 300 base stations countrywide this year alone, covering all the outstanding rural service centres and small towns.
We have also identified shops in selected towns which will be opened as corporate offices to ensure that there is customer convenience when they are looking for direct service.

We believe we have done reasonably well in most urban centres and now our focus is shifting to the rural areas to provide them with wider choice from what they have experienced from the other operators. We have also been putting up ancillary power via back-up generators to mitigate erratic commercial power availability to ensure consistent network availability.

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