x Abu Dhabi, UAE Friday 21 July 2017

Etisalat to raise stakes in Nigeria phone wars

Etisalat is aiming to leapfrog two of its key competitors in Nigeria within four years as the UAE mobile-phone company looks to increase its share of Africa's biggest telecommunications market.

Etisalat Nigeria aims to build on its momentum as the fastest growing telecoms company in the country by expanding its customer base by a further 20 per cent by the end of the year. Akintunde Akinleye for The National
Etisalat Nigeria aims to build on its momentum as the fastest growing telecoms company in the country by expanding its customer base by a further 20 per cent by the end of the year. Akintunde Akinleye for The National

LAGOS // Etisalat is aiming to leapfrog two of its key competitors in Nigeria within four years as the UAE mobile-phone company looks to increase its share of Africa's biggest telecommunications market.

Etisalat Nigeria aims to build on its momentum as the fastest-growing telecoms company in the country by expanding its customer base by a further 20 per cent by the end of the year. So far, it has 13.3 million customers, up from 9.8 million at the end of last year.

"It's tearing along," said Steven Evans, the chief executive at Etisalat Nigeria. "We have a very aggressive set of targets and are looking at between 15 [million] and 16 million subscribers by the end of this year. We are on track to achieve that."

Etisalat's growth in emerging markets such as Nigeria and Afghanistan comes as the operator's revenue at home comes under pressure from its smaller rival, du.

Domestic revenue dropped in the first quarter, but income from global operations rose 21 per cent to Dh2.28 billion (US$620.7 million) compared with the same period last year.

Etisalat owns 40 per cent of the Nigeria business, with 30 per cent held by Mubadala Development, a strategic investment company owned by the Abu Dhabi Government.

The remaining 30 per cent is held by Myacinth, a group of Nigerian shareholders led by Hakeem Belo Osagie, the chairman of Etisalat Nigeria.

In a little under four years, Etisalat Nigeria has managed to capture a 10 per cent market share of Africa's most lucrative telecoms market despite arriving later than its rivals.

Mr Evans said the company aimed to pass Nigeria's Globacomand India's Bharti Airtel in the next three to four years to sit behind South Africa's MTN in the pecking order of the largest operators.

Etisalat Nigeria is focusing on luring customers by aiming to offer better customer service and network coverage, innovative products and lower tariffs, said Mr Evans.

But while the number of new customers joining Etisalat's mobile-voice network is slowing to about 10 per cent a year, activity within the mobile-data segment is rising.

The number of new subscribers for deals that include mobile Web browsing is increasing 10 per cent per month, the company says. "The battle for customers is turning more and more to data," said Mr Evans.

To meet anticipated future appetite for data, the operator is investing more than $400m to improve its network infrastructure. That is in addition to the excess of $2bn that Etisalat's partners have already sunk into gaining a foothold within the industry.

Nigeria's telecoms market is not without its pitfalls, however.

In May, Etisalat and MTN were both fined 360 million naira (Dh8.1m) by the Nigerian Communications Commission for falling short of service standards.

For the same reason, the telecoms regulator also fined Bharti Airtel and Globacom 270m naira and 180m naira, respectively.

Etisalat and MTN cited lack of power and equipment sabotage as reasons for poor connections and dropped calls.

"Where the operators felt the regulator was being a little overly ambitious was that they were benchmarking against other markets that don't have to deal with the same set of issues as we have to deal with," said Mr Evans. "We want that to be recognised going forward so there are more realistic key performance indicators set for the quality of service we as a group of operators have to meet."

Etisalat was also facing a renewed challenge from its rivals as they cut tariffs and invested in their networks in an effort to compete with the company. "The competition has upped its game," he said.

tarnold@thenational.ae

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