Angeline Vere, the CEO of Telecel Zimbabwe
Government is interested in acquiring Telecel Zimbabwe. That’s the latest on the issue surrounding Telecel and its ownership and the latest comments by the Minister of ICT, Supa Mandiwanzira seem to confirm that the government is indeed seriously considering the buyout.
There have not been any indications from Telecel in preceding discussions that indicate that it may be acquired by the government. In fact, from a recent interview, Telecel’s CEO, Angeline Vere, implied that it was business as usual.
However, putting ownership issues aside, there’s also a lot related to the operator’s strategy that will determine how it performs under private ownership or even as a State entity. At a recent press event, we (TZ) posed a few questions to Angeline Vere(AV) and got some perspective on Telecel’s plans.
Here is the full transcript of the interview.
TZ: What are the most important things in terms of strategy direction for the next 12 months?
AV: Ok, basically we intend to continue to offer affordable service, so we are looking at ways of continuing to give service which is affordable, which is value driven for our customers. We have looked at a number of strategic initiatives. On revenue generation immediately we are launching three promotions. I think you have seen the promotions and you are aware of the super voice bundles. We are now introducing also a night promo. The night promo will be introduced in time, within the next 3 weeks or 2 weeks. What we are trying to do is encourage our customers to use our service during the night, either data or voice.
TZ: But as you have such services, doesn’t that hit your bottom line at a time when you are already under strain?
AV: No it doesn’t. Right now if you look at Zimbabweans, after about 11 everybody goes to sleep. So the network is free. So we are just bringing in a promotion which allows us to ensure that the network is occupied during that period.
TZ: It’s an investment that you have already made and you are optimising the use of that investment?
AV: Yes we are optimising the use of that investment. Its no cannibalising our current revenue because its only during the night.
TZ: Talking about the infrastructure and utilisation of that capacity what is Telecel doing or looking at doing within the next 6 to 12 months with regards to capitalising the business as a whole in order to fund new Infrastructure, things like 3G and maybe start looking at things like LTE that other operators are looking at?
AV: We are looking into (it) obviously speaking of bringing in some money to roll out more of the 3G network but we are also looking at optimising the current 2G capacity. We are looking at site optimisation. What I mean by (that is) we are looking at our high-value sites and ensuring that they are available 24 hours a day. That is where our main focus will be. However we have 2G, every base station has 2G which is Edge. We are also ensuring that 2G will be available and you can make your data activities. But we are also going to obviously rollout more on the 3G and on LTE we are looking at maybe (commencing) pilot beginning of next year.
TZ: How much money do you think you will need in 6 to 12 months in terms of optimising the network?
AV: I cannot give you an actual figure. I cannot give you an actual figure because we are really working on it right now.
TZ: Is it an urgent thing to look for more money for you?
AV: Yes it is!
TZ: In the region of how much, in terms of the network with the capacity that you want during the day when people are making calls and using data?
AV: I will not commit to a figure.
TZ: You can commit to a range?
AV: Not really, I will come back to you. We obviously need to also discuss with our holding company, the main shareholder.
TZ: In terms of (shareholding), this will be Vimplecom bringing in new investment?
AV: The shareholders capitalisation, or we get a loan, it depends.
TZ: Now, in terms of the components of the business, what has been the contribution of the mobile money service in the whole business and how has it been affected by this issue that affected the company as a whole, about the license cancellation?
AV: Mobile Financial Services, it hasn’t contributed a significant amount yet, maybe in the region of 5%. Remember we launched in January last year and immediately after we started having these challenges, licencing issues. Yes Mobile Financial Services is the one which has been (affected), which has had huge impact. Obviously you know the Multichoice issue, where Multichoice has, immediately after we got that announcement Multichoice came to us and said look we heard something from the government (can you confirm) confirming that you are still licenced. Because of that, there has been really an impact on Mobile financial Services but I am glad to say that we have started feeling an upsurge again.
TZ: How many partners got into this shaky position of wondering whether you will be there or not?
AV: It was only one or two and all of them not national but outside (the country).
TZ: What about the impact of over the top services like WhatsApp? How has that affected the revenue on data and also the revenue on the voice side of the business and how are you strategically preparing to compensate for that?
AV: Basically over the top services are applications and obviously they have had an impact on our business but what has impacted us more is the 35% retail tariff reduction where the anticipation was that as you reduce the retail price you see an upsurge in usage.
For example if you reduce the price of bread, the anticipation was that instead of having one loaf at your house you start having three loaves but that has not, we haven’t seen that traction.
I think throughout the industry we haven’t seen a serious upsurge which is commensurate with a reduction in the tariffs. That is what I would say has had a major impact rather than over the top.
With over the top we were in anticipation of the fact that yes data is the way to go, new applications are coming and we knew, I mean if you look at the global trend you can tell that voice is now going down.
Voice revenue is going down whilst data is going up. However in Europe the decline is faster for voice than in Africa. We have seen it in Africa declining but not as drastically as in Europe. So we as Telecel started preparing for it by obviously rolling the 3G network in anticipation of an upsurge in data and obviously a reduction in voice.
So we are working with that. We are bringing in a lot of bundles for data, WhatsApp bundles, Facebook bundles because we are recognising that data is the way to go, where everybody is going.