Etisalat Nigeria

In just two-and-a-half years, Etisalat Nigeria has carved a place for itself in the Nigerian communications industry. CEO Steven Evans describes to Gay Sutton how he aims to take the company to the top.

The African continent is undoubtedly a region of tremendous opportunity as nations strive to take their rightful places on the world economic stage. Good communications, which is the business of Etisalat Nigeria, is one of the cornerstones of a stable and prosperous economy. Interestingly for Nigeria, it is private companies like Etisalat rather than the national government that are constructing the telecommunications networks the country will need if it is to fulfil its potential and take its rightful place as a giant of Africa, not only in terms of size but in terms of development.

Etisalat is a relative newcomer to the Nigerian communications sector and has been operating in the country for just two-and-a-half years. But during that time the company has been fast-tracking the construction of a mobile communications network based on GSM technology, and today this comprises over 2,000 cell sites providing coverage in all 36 Nigerian states. Alongside this, the introduction of the latest services and technology has ensured unprecedented growth in the marketplace. “With the network as it stands today we are able to provide coverage for around 60 per cent of the population,” explains CEO Steven Evans. “But in terms of market share, by the end of 2010 we had attracted 6.8 million active subscribers to the network, which equates to approximately 9 per cent of the market. This is phenomenal growth in just two-and-a-half years.”

Etisalat is competing against three companies who have been operating in the country since 2001. “At the moment we are the fourth GSM here. But our intention over the next five years is to become one of the top two operators in the marketplace, and to achieve between 25 million and 30 million subscribers by the end of that period.”

The company’s strategy for delivering on this vision has four pillars. First and foremost, the company is customer focused. A strong ethos of customer service is instilled in the staff from their initial training period, and this is continually reinforced and backed up by measurable KPIs. However, the company also bases the development of its services and products on detailed analysis of the customer’s needs. “We make sure we understand our customers, and provide products and services that are designed with their needs in mind,” Evans states.

The second pillar of the company’s strategy is to be innovative in terms of products and services, and this is very closely linked with the first pillar. “We’ve come into the market as a late entrant so we need to generate excitement and interest from the consumers, and offer them something more than they’re being offered by the competition,” Evans says. “The interesting thing about this market is that there are over 700 GSM operators globally so there are many product and service innovations that have been tried and tested around the world. We therefore have a great opportunity to select products and services from other markets to match the needs of our customers here.” And this has certainly paid off so far, creating the rapid growth in customer base.

Among the new technologies and services Etisalat has introduced into Nigeria so far is Home Zone, which offers a lower tariff for calls made from home, or from the location where the majority of calls are made. Reverse charging is another first for the country and has been very popular, particularly for enabling young people who have run out of credit to ring home to their parents who can then accept the charge for the call. Perhaps the most popular innovation, though, has been the introduction of a missed call service. “Other operators had said it would be impossible to support. So it has been very popular with our customers and has created considerable loyalty among them.”

The third pillar of the Etisalat strategy is to build and maintain a top quality network. Over the first two-and-a-half years in Nigeria, the company has made a considerable upfront investment in infrastructure, funded directly by the company’s three shareholders: the United Arab Emirates-based communications company Etisalat, which owns a 40 per cent share; Mubadala, the sovereign fund from Abu Dhabi with 30 per cent; and the Nigerian group Myacinth, also with 30 per cent.

To date, around US$1.8 billion has been invested in infrastructure, a large part of which has gone into the construction of the GSM network infrastructure. Alongside this, investment has also gone into introducing the next generation of mobile network technology—3G—which will deliver reliable high speed broadband, a capability the country needs if its businesses are to thrive in the global marketplace.

“At the moment we are delivering a form of broadband service by a variant of GSM called Edge, but it’s slow and has low capacity. The introduction of 3G will represent a dramatic change in internet connectivity and data transfer for our customers,” Evans says. Etisalat’s 3G service is scheduled to be launched in the next few months. 

The company plans to continue its investment in infrastructure, and has recently raised an additional $650 million from eight Nigerian banks, which it will spend on expanding the GSM and 3G network. “Ultimately our aim is to provide coverage for somewhere between 80 per cent and 90 per cent of the population. Above that it ceases to be cost effective for individual companies to cover really rural areas,” Evans says. “However, it is possible to collaborate with other operators to build a single network in such areas, and install multiple sets of radio equipment on each tower. So we’re currently in negotiations with other operators to establish what we call passive network sharing to reduce the cost of extending into these rural areas.”

The final element in the Etisalat development strategy is to drive for operational efficiency and thereby reduce the cost of service delivery. To achieve this, the company has drawn together a team of efficiency specialists to form the Program Management Office. “This department is responsible for two things. One of them is managing projects and programmes, and the other is developing business processes and measuring our efficiency through KPIs across those processes. Process engineering and re-engineering is a critical part of our business philosophy.”

Evans believes that the company is now prepared to begin the drive to increase the customer base threefold over the next five years. The majority of the network infrastructure is now in place, 3G is shortly to be rolled out, operational efficiency is continuously being monitored and improved, and customer focus and product innovation are coordinated with the sales drive. If the tremendous achievements of the past two-and-a-half years are anything to go by, this will certainly be a company to watch. www.etisalat.com.ng