advertisement

Techzim Interviews: ZOL CEO David Behr on acquisition by Liquid

advertisement
ZOL CEO David Behr

We had the opportunity to speak to ZOL CEO, David Behr on his company’s recent acquisition by the Liquid Telecommunications Group. In the interview he talks about why they sold to Liquid, what this means for ZOL going forward in terms of independence of the ISP and service delivery to customers. Below is a transcript of the interview.

advertisement

ZOL CEO David BehrSo what exactly has taken place?

Liquid Telecom Group has acquired ZOL. So we’re now part of the group. We have announced it to staff and we’ll be doing an email to customers in a day or so and we’re telling you now.

advertisement

For how much?

That information is still private at the moment.

So, wholly owned by Liquid now?

Yes.

And you [David] going forward?

Going forward I will stay the CEO of ZOL and I will start to do more on the Liquid side to help develop their products and network.

For how long?

We have not defined a set time. I’m very excited about my job. I’ve loved doing this for the past 15 odd years and I’ve just got even more excited. So there’s no fixed time. I’m really looking forward to it. If I absolutely hate it I guess I won’t do it for too long and if I absolutely love it I guess I’ll do it for a long time. I don’t feel I’m being forced to do anything. I really want to stay on. I really want to help ZOL grow. I really want to help Liquid grow. And I want to see the two integrating as well as they can and just become better.

On the customer side what does this mean?

I think for the customers it’s really good news. One thing ZOL has done in the past is we have made a very good name for ourselves. I think we’ve focused on a lot of customer support. We haven’t been perfect as you know; we obviously had some challenges in the environment but we’ve always tried to put the customer first and we’ve always tried to give them as best an experience as we can. I think now with much bigger group behind us we have much more resources and we have much more control of the network itself.

One of the things we have always complained about to customers in the past is that we haven’t owned the last mile and we haven’t controlled the last mile. So we have had absolutely no way to ensure that it’s got good quality of service.  And I think the deal with liquid allows us to now have a much closer relationship with the people physically controlling the last mile.

So for the customers it’s going to mean we have much more access to the whole chain from the customers desktop all the way to the internet overseas. The whole chain is now part of this group and therefore we can give end to end guarantees.

But is there anything immediate, anything the customer will experience immediately?

These changes will take a short time to come to fruition.  So it is not an overnight process. I think it will take time for it all to start to make a difference. I don’t think anyone can wake up tomorrow and find ZOL is a million times better because of this. It will take time to integrate. It’s going to take time to deploy the new systems. I hope over the next 6 months you will feel quite a difference.  We will be launching some exciting new services.

So a customer is used to having a personal service, if they’re not happy with a certain service they are able to call a senior guy at ZOL and have it resolved? As part of a larger group, that will still be possible?

It will. One thing we’ve agreed to do is to keep ZOL very independent and very separate. We’re going to continue with the ZOL brand which is very strong. And we’re going to have the same relationships we have with our customers today carrying on. The customers are still going to be dealing with the same people. They are going to have the same management team. We’re going to have the same support team. So nothing gets worse for the customer.

It’s just that now, if there’s something we need to escalate we have much more visibility into the liquid network where things could be going wrong. We have much more power to get things fixed quickly. And even for staff, change is not going to come pretty swiftly; customers will still be dealing with the same people.

But there’s going to be some change, some staff coming from Liquid

We’re bound to look for areas where we can improve efficiencies. We will do a full skills and capabilities audit, and thereafter decide where people fit best. We’re going to be careful though to make sure customers that have been dealing with Liquid carry on and those that have been dealing with ZOL carry on. We’ll make sure we bring out the best of both companies and not create a muddled mediocrity, where it just becomes the lowest common denominator. We’re going to be very careful to make sure that the customer experience just gets better.

We’re both very fast growing companies. We’ve been growing independent of each other and we’ll keep growing. So it’s not like we’re bringing together two entities that are shrinking in some way.

Will these brands merge at some point?

It’s very hard to see in the longterm future. But for the foreseeable future there’s going to be no merging of those brands. We both have our strengths, I think ZOL has a pretty good brand and name in the retail space and Liquid has a good brand and name in the wholesale and corporate space.

Up to now the Liquid brand hasn’t been strongly advertised or talked about, I imagine that’s going to change. But I think we serve very different segments of the market. We have survived the past couple of years together without trampling on each other’s territories and I don’t see why it’s going to change now.

So Liquid is part of the Econet family and Econet is already doing stuff on both corporate side and consumer internet. How will that work? You’re competing against each other in the same family?

I don’t know how that is going to work because I’m not particularly familiar with the structures that are in place now. I haven’t focused much in the past on what Econet has been delivering. I think Econet is very focused, from what I can see, on GSM, on mobile data. And we’ve been much more focused on broadband by fixed access. We both resell WiMAX products and that can only lead to more choice for the consumer and a great example of how there is healthy competition.  The market segments we target are quite different; it’s not as much mass market as Econet has been going for. We’ve gone for a much higher end prosumer if you like. We all got our market segments that don’t overly clash with each other.  Whilst there is clearly some cross-shareholding, liquid is a very separate and regional entity.

But as we go forward this year, there’s going to be a lot of blurring of that line? The user that’s used to getting good internet at the office is now starting to get good internet at home as well.

I think the line in telecoms is getting blurred in general not just between the user at the office and the user at home. As data starts to be pervasive you start getting services like for example Voice over IP. That’s going to get more blurred with TDM over GSM networks. So there’s a lot of blurring that’s going to be going on but I think that the market is big enough to have the different segments targeted by different types of companies.

And for the big question; Why?

I think that ZOL has done very well for the last 15 years. For me personally, I’ve run ZOL the 15 years and it’s been a great experience. I’ve enjoyed growing the business from literally one computer and two modems. But I personally felt that it’s time for me to get on to doing something a bit bigger. From a company perspective I wanted to make sure that ZOL had a very sound footing going forward. I think the competition in the country is getting extremely severe.

I was actually thinking last night about it, telecoms is pretty the most competitive industry in Zimbabwe today. I can’t think of a more competitive industry. So there’s a lot of fragmentation at the moment and consolidation is quite inevitable. You’ve already seen consolidation happen when last year iWayAfrica (Telkom) bought out Mweb Zimbabwe and Africa Online. There are so many players in the telecoms space at the moment its inevitable there’s going to be consolidation driven by market forces because there is so much competition out there.

So one of the reasons to do this was to become part of a bigger group that would give us a much more solid footing going forward. And reduce the risk in customers choosing a company like ZOL. I think being independent, I think being small relative to what telecoms is, there was always a bit of a danger that customers would fear being with a smaller ISP. Although we would commit to giving a good service there was some degree of questioning over viability. We have always been successful up to now, but going forward there was always the possibility that we get squeezed because of the heavy competition in the environment. By doing this deal it ensured ZOL’s viability and gives us access to far larger resources.

In terms strategic alliances you had with other ISPs and IAPs, YoAfrica, Aquiva, Aptics. What happens to those?

Well we have to see going forward what’s going to happen to that. I don’t think a lot will happen. We will continue with our important strategic alliances. As you know, we did have an alliance with YoAfrica in terms of investment into these WiMax networks.

ZOL as an independent company has a choice where it’s going to buy services from. We are always going to buy services where we think we’re getting the best deal both in terms of price and in terms of quality of service. So there’s no reason for us to go and jump ship or be forced to buy from any particular vendor if we’re not going to give customers the best deal at the end of the day. So the most important thing is to keep our eye on the customer and make sure the customer is getting the best service and the best price. And I can’t believe that we would ever go a situation of doing something that would hurt that.

So I hope that our existing strategic alliances can continue and will flourish, and we will certainly work with them to make sure they are comfortable with it going forward. Obviously it takes two people, but from our side I hope that we continue to always be able to get the best service to the customer.

And your general comment in terms of uptake of internet services in Zimbabwe. Do you see any major things to happen in 2012

I think in 2012 were going to see a lot more uptake on another segment of the market because I think up to now internet has been quite expensive. I think it’s been very clear over the last year how much internet pricing has dropped. And obviously as you drop prices you make internet available to a much broader spectrum of customers. So I think you’ll see the market grow quite dramatically because of that.

We’re continuing to get as much fibre as we can to customers because we really believe that long term, the only way to deliver services is over fibre. Because once you put in that fibre, once you’ve invested in that fibre, you can deliver not just data services but all kinds of services over it. And of course it’s infinitely expandable.

This is fibre to the home?

Yes, we’d like to do fibre to the home. At the moment we’re doing fibre to businesses. We’re doing fibre to neighborhoods and ultimately fibre to the home is the end goal.

And you don’t think Wireless is there yet?

Wireless is always going to be about capacity because there are simple laws of physics that only allow a certain number of megabits to go over the megahertz. Of course wireless is getting improved over time but in terms of legacy network I don’t see wireless being able to deliver the high capacity bandwidth to the home. I think wireless will always have a good place especially mobility. But when we start talking 20 plus megabits speeds into each home, I don’t believe wireless can deliver that.

Do you think Zimbabwe is there yet in terms of needing 10, 20 megabits to the home?

I think everywhere in the world where you have delivered those kind of speeds, you find the consumers finding a way to make use of them.

Like?

Like YouTube, download of movies, rental of movies, video conferencing, a bunch of services that we can’t even envisage today that will come. I think that every increase in speed has always ended up being consumed by consumers. I don’t think we need to worry too much about what they will be doing with it because they will figure out ways or companies will figure out ways to deliver that to them.


Quick NetOne, Telecel, Africom, Econet Airtime Recharge


WhatsApp Discussions

Click to join a Techzim WhatsApp group:
https://chat.whatsapp.com/EnkR09pi9CIGPYKvdXrLIp

If you find the group full, please notify us on +263 715 071 199 and we'll update the link.


23 thoughts on “Techzim Interviews: ZOL CEO David Behr on acquisition by Liquid

  1. sounds complicated on the alliance with other IAPs there.
    and the econet side woooow strange
    let me see if they dont buy you out.
    i don like econet/tn hostile takeovers

  2. Wholly owned and independent. They have to invent a new management system for that to last! There is business sense in the “why now?”.

  3. Remember Econet bought out Data control from the Nustern family and called it Ecoweb. Zol is bound to be ecoweb as well soon. In terms of corporate politics it will be very difficult for Zol to exist under the guidance of the old Zol gaurd. They have been paid and my advice is for them to take their money and invest in value added services around the internet and mobile computing.

  4. I really am praying that Liquid continue on its acquisitive streak and buy out Brodacom as well. We have gone for up to seven months without pay. There have been promises of things getting better but the exodus of technicians and even the senior guys is telling a different story. The irony is that some of the techies are heading to Liquid telecoms and that is why i wish the latter would just consider buying us. Kana vakatitora on board, we know kuti tinenge tapinda. Brodacom has been a painful and expensive experiment. Someone, please just come and buy us. 

    1. I think Brodacom will come right in the fullness of time. People just need to be able to imagine the impossible and it will become possible. They just need to see the invisible, sort of like ghosts or something. Give them a decade or so then they will start turning a profit. Telecoms is not retail where you get your money back there and then. You need patience. In the meantime, get a job elsewhere mr riverdance

      1. Easy for you to say. You probably have a good job that pays you well and on time. You are like those in Borrowdale who sit in their air conditioned living rooms, watching HDTV and asking themselves, “Why do the people of Kuwadzana 5 not buy bottled water to avoid the typhoid?” Musadaro veduwee. Wedzerai empathy

    2. Riverdance, I understand your frustrations. The problem with today’s economy is that of liquidity(hakuna mari) so I think your bosses might just not be the only ones going through this problem. I agree with Sango Shumba that given time, Broadcom will come right. Which is better to be fired/retrenched or to be owed seven months salary and be paid all that you are owed.

      1.  This is insane, hanzi better to employed and not getting paid for 7 months!!! what kind of reasoning is this?
        No wonder Mugabe continues to piss on us and he knows we will do shit about it.

  5. My main worry with Zim ISPs why are we still getting 20+ hops to ZA while they are just our immediate neighbour. LTTPR-1.UK.MTNNS.NET [195.66.224.18]

    1. This being a commercial decision of some of the bigger South African ISPs including MTN That you mention who Want to charge Zimbabwean ISPs crazy rates to ‘buy’ bandwidth to their customers websites.

  6. Does anyone out there know of an ISP in Zim who provides cheaper Vsat than what we are getting now.Without mentioning names we are are paying a whooping $1200 per month for 2MB Up/ 400 Kb Down on a Contention ratio of 8:1….can some one tell me if this is beatable elsewhere

  7. I respect ZOL as a leader in providing true innovative internet products for the longest time, I wish them the best and hope that something fruitful will arise from partnering with the likes of liquid. I personally have no pleasant words regarding Econet affiliates and subsidiaries and will probably never have. I hope this acquisition will not result in a Kingdom Bank style wrangle. All the best Mr. Behr   

  8. Interesting article. But one thing I hope that will come from all this is a reduction in EQUIPMENT prices for wimax etc…(I, like many who don’t live close enough to a wimax base station need an outdoor modem according to zol, aptics and yo.) I am prepared to pay the $70 or even $135 per month for their “unlimited” internet but then managing to fork out the $500+ needed for installation is too much to handle at one time. Maybe you can even implement a contract system where a person is bound to your company for maybe 6-12months so that you can afford to give the equipment at cheap prices and have them pay back the real cost over the contract period.

  9. 1. Why can’t brodacom introduce commission based salaries, they are in business, they have clients, let them share with their employees proceeds from the clients payments. If the clients are getting service for free, I also want to be one of their clients. Recently creativeloop.co.zw were complaining about some prejudice on a brodacom promotion, so what is what  here? I think some paper or blogger needs to cover the BRODAGATE scandal so that employees are protected. If you do not have the money to run a business then work for that money and then get back to business.

    2. As an exit plan maybe Mr Behr you did a good thing but I am sure and certain that if Liquid/econet/tn bought ZOL then yes you have your desires on going forward for the business but expect anything from Liquid, they will run the company the way they want and would chose suppliers they want because IT IS NOW THEIR BUSIESS. Ask Mike Arrington who sold Techcrunch.com to AOL. Now he is always rumbling and complaining on how AOL is messing up things. If I sell bread and someone buys it, it is up to them how they consume the bread…

  10. Another man’s meat is another man’s poison. You never see how bad a company is until u get in there. 

  11. one thing ZOL has been VERY disappointing with is it’s service in Bulawayo. I hope this improves.

Comments are closed.

%d bloggers like this: