AJAY AWASTHI is the CEO of Spectranet Limited, a foremost Internet Service provider in Nigeria. In this interview with DAN OBI, he says Nigeria has made rapid strides in mobile broadband penetration. However, the story is completely different in Fixed Broadband space. He said given the criticality of FBB in delivering high quality and affordable services to homes, MSMEs, a unified, nationwide policy can help unleash the potential of this sector. Excerpts:
As a major player in Nigeria’s Fixed Broadband segment, how will you describe the pace of Nigeria’s broadband penetration and its impact on digital infrastructure?
Fixed Broadband penetration in Nigeria is at abysmally low levels currently at about 0.1%.This pales in comparison to overall broadband (including mobile broadband) penetration which, as per the latest figures by NCC, is at 42.27 %. Just to put these figures in the right perspective, the worldwide Fixed Broadband penetration in 2021(as per Statista) is 16.7% with Europe leading the table with 34.7% penetration.
Fixed Broadband services have the capability to deliver extremely cost effective, high quality and high-speed access to internet. It can play a significant role in overall development of world class digital infrastructure in the country.
It’s quite clear that there is a lot of ground to be covered to increase Fixed Broadband penetration to even half of the worldwide penetration level. Being the foremost ISP in Nigeria, Spectranet is keen to lead the effort to increase the FBB penetration to the next levels within the next 2-3 years.
Spectranet as a pioneer in launching 4G LTE services in Nigeria is popular for providing 4G LTE based internet services. What was the trigger for launching Fiber based Fixed Broadband services?
Culturally, we are an extremely data analytics and insight driven company with a deep sense of commitment towards proactively serving the needs of customers, the first to recognize the changing trends in data consumption and offering relevant products or anticipating and eliminating the causes of their pain points.
Post COVID, we have been keenly observing the key shifts in usage behaviour of our customers. A post COVID data user wants high speed internet access with low latency, high level of consistency with 99.99% up time. All this at extremely affordable prices to watch movies on OTT platforms, play games or use video conferencing! We understood that these fast- evolving trends can be effectively addressed with a superior price-value proposition, through Fixed Broadband technologies. This is what triggered our entry into Fixed Broadband and we are extremely pleased with the response we have been getting in the market in the cities of Lagos and Abuja. We will soon be entering into other markets too.
How is Spectranet going to differentiate its Fixed Broadband services when 5 G services are launched in Nigeria soon?
The Telecom regulator NCC has done a commendable job by auctioning 5G Spectrum way ahead of many other countries. For a comprehensive 5 G launch, in order to realize the full benefits like high speed data, low latency, IOT, it is critical to have an omnipresent network interconnected through a robust optic fiber network- connecting various towers and then for backhauling of the data to the network core and further. All this infrastructure is at a miniscule level at this point of time and would certainly take a couple of years to be fully on-ground.
Having said that, Fixed Broadband and 5G technologies by no means are competing technologies. These will actually complement each other. Advanced technologies in fixed Broadband like XGS-PON are capable of delivering upstream and downstream speeds of10Gbps,way above 5 G speeds and at low latency levels. Both the technologies will co-exist, serving different needs of the customers while on the move or working inside an office/home.
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Fixed Broadband roll out is generally known to be slow paced due to associated challenges on account of securing right-of-way, trenching work and laying of cables. How is Spectranet managing rollout of FBB services?
At Spectranet, we fully well understand the on-ground challenges and have been addressing these by deploying multiple technologies – HomeFibre ( FTTx) and FibreOnAir (WTTx). The latter is used in dense areas and helps in expediting roll outs of FBB. By this dual technology approach, we are able to deliver high quality internet services at a rapid pace.
What are your greatest challenges in offering FTTx services and how best could the challenges be addressed?
Nigeria has made rapid strides in mobile broadband penetration, with the regulator NCC playing a key role in proactively driving this through relevant policy interventions. However, the story is completely different in Fixed Broadband space. This industry is completely bogged down by the lack of unified and robust policy framework for granting right-of-way (ROW) and charges the operator needs to pay for laying optic fiber cables. Different states have different approaches to these which effectively thwart quicker rollouts. Further Non-availability of affordable/ reliable metro and national optic fiber networks also poses a key constraint on offering high quality Fixed Broadband services.
Given the criticality of FBB in delivering high quality and affordable services to the homes, SMEs/MSMEs, a unified, nationwide policy can help unleash the potential of this sector.
Over the last 3-4 years after MNOs launched their 4G services, we have witnessed intense Data price wars and a significant reduction in Data prices. How is Spectranet defending itself?
This will need a bit of explaining to set the context right. In Nigeria the regulator has fixed a floor price for Voice calls and the operators cannot charge less than the floor price. This wise move by the regulator has ensured that no operator indulges in predatory pricing hurting the profitability of the industry which is so critical to the creation of a digital economy.
Strikingly, there is no floor price yet fixed for Data prices and that is leading to an imbalance in the industry which favours the bigger players. While the MNOs are using their floor price protected voice revenues to cross subsidize and slash data prices, ISPs like us are forced to drop prices to unsustainable levels in order to defend themselves. Let’s be clear that ISPs are defending the indefensible if the regulator doesn’t intervene immediately and set a floor price for data to curb predatory pricing.
Isn’t a price war good from the customers’ view point?
I have said this earlier also and my views remain consistent.
War of any kind is destructive by nature. A price war is no exception. It is a short- sighted ploy to gain market share. In the near term, it may be touted as a “customer friendly “move but over a period of time a price war results in significant destruction of value for the industry, forcing the players to degrade quality of services. A price war is not sustainable in the longer term and a lose-lose proposition for both the operators and the customers. The hapless customers finally end up at the receiving end and are made to suffer through poor quality.
At Spectranet, we stay committed to provide high-quality, high-speed broadband to our customers. We believe in delivering a superior customer experience through better understanding of their needs and through differentiated tariff plans backed by excellent customer service.
What is Spectranet approach to customer service?
At Spectranet, we deeply acknowledge the fact that customer service is not just limited to putting up a call center but goes much beyond and that CS can be a powerful source of differentiation in the market place. Customer service to us is not a reactive action but an organization wide mindset which gets embedded into all aspects of the business.
Secondly, we constantly remind ourselves that Customer Churn is just one bad experience away. We call such bad experiences “customer pain points” and assiduously work on getting down to the causative factors and addressing these. Proactive customer service (anticipating customers’ needs and pain points) is like a religion at Spectranet. The focus always is on eliminating these pain points or bad experiences by staying ahead of the causative factors.
Another critical factor is the design of Customer Service Delivery (CSD) organization and the hierarchical distance from the front-end Customer Service Executive to the CEO. At Spectranet we have managed to keep just two layers between CSE and CEO and that helps significantly in staying tuned to customers’ requirements in a proactive manner.
Telecom operators are itching to increase the cost of voice call, SMS and data services by 40 per cent. Are Internet Service Providers (ISPs) like Spectranet also thinking of a price hike in the cost of internet services?
Across all the industries the cost of doing business has seen a significant increase over the past few quarters. The cost of running the towers being a significant cost, the recent hike in the price of diesel has further exerted pressure on the bottom line. As an industry, telecom has held the prices virtually constant over the last few years. In order to continue providing high quality services to our customers and continue to create direct and indirect employment to thousands of people, it’s imperative that survival of the industry is ensured through a price hike mitigating the impact of ballooning costs.
As an internet service provider in Nigeria, what safety measures have Spectranet put in place to ensure security from Cyber attacks?
With more and more digitalization happening, the vulnerability to cyber attacks has increased for sure. Cyber Security threats caused by DDoS, Malware, Emotet etc. are quite common these days. As an operator we take cyber security very seriously and have deployed sophisticated equipment to thwart and neutralize these threats. There are multiple layers of cyber security comprising latest generation of Firewalls and Intrusion Prevention systems which effectively neutralize such threats.
Q: Fixed Broadband services have the capability to deliver extremely cost effective, high quality and high-speed access to internet. It can play a significant role in overall development of world class digital infrastructure in the country
