Abiodun Omoniyi is the managing director and CEO of VDT Communications, a leading broadband communications service provider. In this interview with Jumoke Akiyode-Lawanson, he talks about VDT’s recently launched retail data network 4G LTE advanced service, Nigeria’s telecommunications sector challenges and the company’s plans for 5G in the future. Excerpts.
What is the acceptance rate of VDT services since it launched a month ago into the retail broadband internet market?
The market has responded quite well to our introduction and we have seen an increase in market uptake of the product. We are also getting good feedback about the service from customers, in the sense that there is nothing like hearing from the customers. We do pride ourselves in our customer service and customer feedback is very important. VDT is an ISO certified organisation and what ISO focuses on is making sure that the customer is the centre of activity before you can be certified. We have experienced increase in sales and this has afforded us the ability to hear feedback from the customers which we use in refining the product for a better quality service.
What are the steps VDT is taking to make sure that it does not struggle to survive in this tough operating environment and that it gains a wider reach to all Nigerians?
We are quite happy to be part of the market development of broadband services in Nigeria; in the sense that there is a lot of yearning to deepen broadband penetration, and we can see that the totality of all the different operators cannot meet the demand right now, especially when it comes to the quality of service, coverage and spread. We are just trying to contribute our own quota to this – trying to make sure that there is availability of service, better penetration of signal and that internet services are a lot more qualitative. VDT prides itself in providing a more qualitative service than others. To expand this service, we are planning to invest more and we have also taken steps to assure our investors that once we are able to show the rate of uptake in Lagos, it will be a lot easier for us to move on to other cities across the country. We have a plan to expand to five other cities in Nigeria before the end of the year. However, our aspiration is far more than that because our license is national which is why we also need customers’ attestation that the market is truly there, and the only way you can know that is in recording good sales. Our plan is to move next to Abuja, Port Harcourt, Kano, Ibadan and Benin.
What is VDT’s unique selling point considering that there are so many other internet service providers in this market?
There is a gap in Nigeria’s internet service market, and that is the need for good quality service. If you know and understand VDT’s history, you know that we would never launch unless we can provide that good quality service. Everybody says they provide quality service but what do they actually mean by quality service? Customers want to be able to stream videos seamlessly without buffering. This is what VDT is offering, because we have provided adequate bandwidth to every customer’s access, and we continue to monitor that, and make sure that it delivers. We also provide available and affordable service for different segments of the market.
What prompted VDT to move from serving only corporate clients to playing in the retail space for the provision of broadband services?
Apart from wanting to bridge the gap in providing quality internet service to all, we have ensured that we have a bouquet of several plans to address the needs of different people. Families that are home only after work in the evenings are being offered our free night service plan from 8pm to 7am. We are the only network that provides free night service from as early as 8pm in the evening. Discerning customers know that if you must provide good quality service, you cannot give fully unlimited service because there is what is called the fair usage policy which means that you still need to put some economics behind what you call ‘unlimited’. As a service provider, you will not want some people to take more than their fair share. When you put more and more people on a bandwidth, then it becomes limited because it is a finite resource, so you want to make sure that people use their fair share. What would be the point of having an unlimited internet service valid for 30days which doesn’t work properly for some days out of the month?
VDT is operating in a tough sector. What challenges do you think can impede the growth of Nigeria’s telecommunications and broadband industry if not duly addressed by either the government or stakeholders?
The issue of security of lives and property is a big challenge in Nigeria which needs to be addressed. But particularly in our sector, telecom infrastructure needs to be protected, especially right now when we are pushing a lot of data traffic and need to be able to provide uninterrupted service. In a situation where digging and fibre cuts are not monitored and prevented, there will always be service disruptions. Also, power infrastructure affects every sector including the telecoms sector and because we have found a way to generate our own power in this sector, it drives up the cost of provision because the multiple base stations need to be constantly powered, maintained and secured. Another major challenge in this sector is the issue of multiple taxation. However, in the last few months, this has been a bit mellowed. We are just hoping that the government agencies can come together and earmark what taxation they want players to pay, rather than coming up arbitrary charges that we need to pay. These things actually disrupt services.
VDT is a strong player in terms of 4G service, especially since the acquisition of 2.3GHz spectrum from the Nigerian Communications Commission (NCC) in 2016. What preparation is the company making towards the future deployment of 5G services in Nigeria?
We are still grappling with deploying 4G generally around the world and not just in Nigeria. 4G has not really been dense enough world over. However, the direction eventually is 5G and I believe we would get there. For us to have autonomous vehicles, Artificial Intelligence and others, 5G needs to come in. VDT is at a vantage position to be a foremost company in the introduction of 5G in Nigeria because the infrastructure that we have built is built from the ground up. We don’t have 3G, our infrastructure is built on the Long Term Evolution (LTE) foundation and 5G is coming on this new LTE foundation so we would be one of the first companies to provide this service when it comes. In fact, what we are currently providing is actually a 4G advanced service which is also known as 4G plus.
Is VDT partnering with any Original Equipment Manufacturers (OEMs) to ensure that adequate devices for your advanced 4G service are readily available for customers in this market?
In the telecom world, you can’t do it alone. Even the bigger Mobile Network Operators (MNOs) actually work through the sellers. We are using the same kind of model to move the service. VDT is currently partnering with OEMs, supermarkets and others to ensure wide spread across the city. We have signed about 45 resellers and 50 sales outlets in Lagos.
How does VDT come up with investments in its business and is the company looking at the possibility of going to the capital market in the future?
VDT has operated in this market for more than 18 years, and one thing we believe in is building a legacy, and the only way to do that is to open up the business to raise more investible funds. We have advisers that will let us know the appropriate time to go into the capital market. We are not opposed to listing on the stock exchange but we need to do it in a way that does not crash the system. VDT is operating for the long run, so we will definitely come to the market at the right time.
Is VDT interested in playing in the space of payment service banking?
We are interested in playing in everything digital and not just being a digital payment service provider and that is why we are currently working on customer acquisition. Many of these digital services such as artificial intelligence, autonomous vehicles and the likes are going to be driven by the connectivity companies.
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