Ben Uzor Jr & Adelani Ashamu
Two major Nigerian telecom companies are pushing the boundaries of competition further with strategic price and investment moves that will position them for future customer-skimming. First, MainOne, the underwater cable operator, yesterday fired a fresh shot on radical pricing in the cable market by proposing new adjustments in its pricing strategy, aimed at encouraging more uptake of bandwidth subscription below 10 megabits per second.
At the same time, Starcomms, one of the Code Division Multiple Access (CDMA) telecommunication operators in Nigeria, disclosed fresh investment of N1.4 billion ($9 million), to improve capacity and strengthen its network in 10 cities in Nigeria. MainOne says it would achieve its new pricing strategy through a Partnership Advantage Programme (PAP) strategically designed to provide pricing incentives to customers aimed at increasing their volume of business with MainOne cable.
Prior to this initiative, capacity was offered at MainOne's IP (Internet Protocol) Transit and IP Internet Access offering from 10 megabits on its Pay As You Grow (PAUG) service offering which allows customers to start at 45 Mbps and grow into STM-1 (155 Mbps) through its wholesale products. This new initiative, the cable company said, would allow Internet Service Providers (ISPs) and telecoms operators to increase subscription and accrue benefits rapidly, and thus drive increased utilisation for MainOne pipe.
Industry analysts told BusinessDay that the move would assist in growing MainOne access to the market, and accordingly, achieve the desired objective of increasing broadband penetration in Nigeria. "MainOne is looking to create opportunities for telecoms companies and Internet service providers to expand their portfolio and generate a continuous, incremental revenue stream based on the MainOne network," Gbenga Adesanya, a telecom analyst said.
Speaking at the launch of the company's Partner Advantage Programme in Lagos, Funke Opeke, chief executive officer, MainOne Cable Company noted that customers were not experiencing the expected reduction in prices since the submarine cables landed. She added that the firm had continued to receive feedback and inquiries from end users about direct connectivity to the MainOne platform.
Meanwhile, cities targeted by Starcomms in its investment expansion drive include: Abuja, Oron, Ikot-Ekpene and Eket (Akwa-Ibom State); Jaji, (Kaduna State); Suleja (Niger State); Maiduguri (Borno State); Umuahia (Abia State); Tinapa (Cross River State) as well as Agbor (Delta State).
Chief Operating Officer at Starcomms, Logan Pather who made the disclosure yesterday, told IT News Africa that the investment would cover the areas of equipment and logistics, among others; a process that aims at seeing the company rolling out services to other parts of the country where the company previously had no coverage.
Pather explained that the investment would also lead to the improvement of its capacity in congested sites and areas where it currently has coverage, assuring that subscribers to Starcomms services, within the next three weeks, would be engaging in commercial launches in all 10 cities.
According to him, "Starcomms has continued to make significant investments in the telecommunications industry, despite the difficulties that characterise the business climate in Nigeria."
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