Dear Sirs, Price is not everything

I have been meaning to write this article for a long time now.

Looking at the mobile services market here in Nigeria, I am both amused and sad (though how that combination is possible is beyond me) at how everything seems to boil down to price.

The operators are in a nasty price war – and I daresay that we all are the worse for it. Here is what may have escaped us – every time a network operator has further crashed tariffs, quality of service (QoS) on that network has followed in tow.

Unfortunately, the consumers, who cry foul every time that happens, are as much to blame for the scenario.

But an industry that is price-driven alone is a dangerous thing. Note that I said “alone”.

I wish that one network operator would dare to stand out and offer significantly higher tariffs and superb, stellar services. For example, I’d like to see a network where I can upload 2GB of data without breaking a sweat in a matter of minutes. Every single time. I wouldn’t mind paying more for that service.

That would be serious differentiation based on value, not just price. People who need that kind of reliability are sure to be willing to pay for it.

price

Let’s take a look at the device market. Apple introduced a device that offered much less features than the competition, but that also cost significantly more. This was at a time that the global economy was going down the drain. Did Apple fail?

No; they didn’t. As a matter of fact, Apple has performed exceptionally well by refusing to compete on price. The iPhone range offers less features than others, but because it does well those things that it offers, it could be sold successfully at a premium price.

That’s market differentiation. Apple was not trying to produce another Symbian or BlackBerry copy back then. While they have since implemented some more features, they are still not producing just another smartphone.

I hope we get the picture. As consumers, we need to accept that all networks do not have to offer low tariffs – if they can offer superb value. We need options, and right now, those options do not exist.

Paying More for Less

While we now have much lower tariffs than we had many months and years ago, the fact that we have to maintain multiple lines and devices means that we may not necesarilly be spending less.

We are probably just going round in circles.

Options and Choices

I want to see the people’s network – one that offers the lowest tariffs. But then, I wouldn’t expect the most reliable services from such a network in comparison with a network offering premium services.

I also want to see the turbo (premium) network – one that offers the most rock solid connections for both voice and data, but perhaps at significantly higher tariffs.

There would also be room in the middle – for those who want a bit of this and a bit of that.

That way, consumers can make real choices. With a market as large as Nigeria, operators should have no fear of standing out from the crowd.

The Present is Mediocrity

Unfortunately, right now, there is no differentiation in the market. Absolutely none. There is no competition, for competition based on price alone is not healthy competition.

Dear network operators, where are your balls? You are all hiding in your comfort zones.

Right now, all you are offering are the same things at more or less the same prices. You are valueless brands. Waterless wells. Tasteless salt.

Your so-called brands only exist on TV and on the pages of newspapers. I know that your brand managers will blacklist me for saying this, but its been said. Go break a leg.

All you have here in the Nigerian market are business names, not brands. You are all the same.

And when someone dares to attempt to glorify this mediocrity with a statement like, “Only in Nigeria is this possible“, yes; I agree – only in Nigeria can anyone make millions daily from offering such poor, tasteless services like our networks operators offer.

In 2011, and in a country of over 150 million people, that’s shameful.

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27 comments

  1. True talk, Mr Mobility.

    I remembered 2 or 3 weeks ago when Etisalat introduced their Blackberry Complete at N1500, and also drop their prices of Easyblaze data plans. You lamented that QoS would drop significantly. You have been proved right.

    I enjoyed my Etisalat full BIS for a week before the price drop was announced, and since then I have been frustrated by Etisalat BIS. For more than a week, Facebook for Blackberry has refused to work, despite uninstalling and reinstalling several times; web browsing has been equally annoying; and Etisalat BIS has experienced downtime several times.

    From your article, the people’s Network should be Globacom [at least for data], and the Turbo network should be Etisalat or MTN.

    Etisalat just announced that they had about 10 million subscribers in 3 years. Great. Then they now expressed their desire to have 20 Million by 2013. They have now entered the race of numbers and boasting.

    When easyblaze came out, my friends were complaining about the high prices of the data plans, and I defended Etisalat. I was shocked when they made their data plans on par with those of Globacom. I wont be surprised if Glo drops their prices anytime soon, but you can be sure I wont buy ANY!!

  2. Mr. Mobility, the frankness of your heart-felt dissatisfaction cannot be over-emphasized. i have written off emptyhen and gloi a long time ago.. airtel is not even in d contest.. etisalat… etisalat…

    since the price reduction,i decided to take a crital look at what makes it thick… nothing. initiallt it was actuall fast and at blazing speed. not anymore. so whats d point.. the adverts are only meant to lure unsuspecting subscribers not to deliver credible services. in my area,etisalat was taking the lead in data services,with specific reference to connectivity.. while they were on 2g,i used their easynet and a Nokia N97,it was quite fast commpared to other networks who even boasted of 3g.immediately their 3.75g was launched,it was really fast.. its an apology now.. though managable compared to others..

    the convergence of mobile telephony now is centered around data services…(4g; LTE)… I feel a network provider should just focus on excellent services and name their price. nigerians will play along.. honestly

  3. I disagree with the comments about etisalat. Yes the network has issues but in my area i use etisalat on 3g network mode 24/7 with out interuptions. I dare not do that with mtn, glo or airtel cause i wont get a network signal.

    Now lets talk of emptyhen. They are the most expensive network in the country BUT have a very bad quality of service. The problem i believe is that all this networks are only interested in profits like yomi said. NCC is at sleep.

  4. may we not miss the intrinsic cancer yomi is talking about.

    Nigerians wake up. its not about whos doing manageably. Yomi just opened our eyes to the fact that they are all failures and they have been taking us for a ride.

    Just today i load etisalat for data, glo for fixed calls and mtn for family and friends expanded-madness! yes this is madness. some body should call in the psychaitric doctor. when i was recharging earliar today, i thought i was being smart. I now know better.

    This is a dangerious country where anything happens. God help us. Amen

  5. You’re right! Once upon a time I would swear by and steer anyone toward Starcomms, 1X first, then EVDO. They provided a simple, straightforward and stable, though not super fast connection. I felt data was their ‘competitive advantage’

    Then the GSM companies began rolling into their ‘territory’. Rather than read the signs and up the ante in speeds, Starcomms persisted in ‘competing’ with the GSM majors who have since overhauled them in the speed stakes and now I find it increasingly difficult to justify renewing my SComms data plan.. A case of what could have been… Starcomms: masters of data.

  6. I’m not sure who this write up is directed at. Is us the consumers to embrace QoS at expense of cheap price offerings or to the operators to try at distinguishing their services through quality delivery?

    Etisalat did try offering some premium services with a little higher price offerings but did not maintain that for long before throwing it open to the masses and I’m sure if the result they got with the initial move was positive, they would have maintained it.

    In this business and in this part of the planet, number matters so much that you really can’t afford to miss out in that area. This is one of the reasons Airtel (then ECONET) is where it is today.

    Comparing business in Nigeria with business in the USA is not healthy at all because the terrains are entirely different. Apple survived with the case you mentioned because they brought total revolution to mobile computing. They started with similar business approach on the desktop and failed dismally.

    There certainly are people who would be very happy to pay good money for premium data services but such numbers might not be enough to grow or even sustain business.

    1. Harry,

      I’m not sure who this write up is directed at. Is us the consumers to embrace QoS at expense of cheap price offerings or to the operators to try at distinguishing their services through quality delivery?

      Care to read the article again?

      In this business and in this part of the planet, number matters so much that you really can’t afford to miss out in that area. This is one of the reasons Airtel (then ECONET) is where it is today.

      Not true. ECONET was locked in a bitter price war with MTN from the word go. As a matter of fact, they were always the more affordable of the two networks.

      ECONET-Airtel is where it is today because of persistent boardroom squabbles over the years.

      There certainly are people who would be very happy to pay good money for premium data services but such numbers might not be enough to grow or even sustain business

      This blanket assumption is what has stifled innovation in the country for years. I do not believe that there are not enough people in this country who are willing to pay one or two thousand Naira extra per month for premium mobile services as a sustainable business model? I simply don’t.

      The key problem is that every time a network has charged a little bit more, it has not been commensurate with the QoS of the service.

  7. Yomi,i quite agree with you in all ramifications,and also,i think you should open a voting angle for us all to vote on voice,data,quality,customer care and other services.

    I am in Kano and i have used all sort of modem,now i have come to terms with GLO Netpro,and i can beat my chest for them.On voice calls,please don’t ask me,because i will rate them as follows;VOICE-GLO-6,MTN-2,Airtel-8,Etisalat-4.

    even at that,let us ask,has their 3/3.5/3.75g,they all claim,has it gone round for example,Lagos state? or they only have in Ikeja,V/I,Ikoyi,Surulere,Lagos Island,Banana Island and some part of Lekki.

    Everybody knows that the most stingy network is MTN, i stand to be corrected,and they have the worst call connection in the country.
    Let us have a forum to discuss them.

  8. when etisalat first started the 15mb free that for 200naira, it looked like a very good thing! And yes it was until very recently when the congestion on the network made it almost unusable! And dashin out 15mb for 200 is not sustainable, the day they stop giving it, ppl will stop patronising them and go back to their original lines…

    If etisalat stops their freebies on data today, their data will stand out again and yet still competitive pricing (i stand to be corrected)!

    1. Shayman, my thinking is a little different.

      Etisalat’s data services took a hit after the recent tariff slash. For a network that was already dashing out 15MB free data per N200 recharge, the initial Easyblaze tariffs were okay. They didn’t need to crash tariffs further. It’s their call though.

      All I am asking for is serious market differentiation, such that specific needs are adequately met. Right now, no real needs are being adequately met.

  9. Well i think if they stop the freebies and make ppl pay for the service, the quality would return to number..there are a lot of peeps using etisalat cos of the 15mb only. They make their calls on other networks..if you stop the freebies..the ppl that are really ‘using’ etisalat will gladly subscribe to data services and i bet there wouldnt be congestion! ..

  10. I believe the problem of Quality Of Service (Qos) is a manifestation of inadequacy of effective monitoring by the NCC (Nigerian Communication Commission ).

    There are ISP’s that refuse to add new subscribers when they know that their network will be overloaded – if they do. They wait until they build more capacity before adding more subscribers. That is the logical thing to do.

    Why can our GSM providers NOT apply some discipline and only take on loads that their network backbone can ‘carry’? Of course, it all boils down to the poor regulatory regime that affects almost every facet of our national life.

    If a network provider greedy, and keeps attracting subscribers – by whatever incentives – DESPITE a lack of capacilty to service those subscribers effectively, then NCC should wake up from its somnolence and call them to order.

    Ncc should direct any culpable Provider to desist from adding further subscribers – until they have broadened their network capacity enough to take on additional load. It is that simple.

    I do not share the viewpoint of jerking up prices – so as to keep ‘non-premium’ subscribers off ‘premium’ services – just to keep the poorer folks from enjoying those exclusive quality service. Wrong, escapist solution, I would say.

    The networks have not complained that they lack the financial muscle to expand their network. In fact, there is a law in the works to compel them to go ‘Public’. Why are they all refusing to go public? When an Industry is so critical and grows to the level of these networks, the next logical thing is to go ‘Public’. Facebook is about to follow this path off reason.

    Conclusively, our objective is to get good_quality service. The networks can be compelled to only keep adding subscribers when they have demonstrable capacity to take them on. Getting them to charge more to discourage poor subscribers from getting on board is not the right solution.

    Of course this is easier said than done. I suspect the ‘Enforcers’ are probable on the Payroll of some of these big companies

  11. Ncc should direct any culpable Provider to desist from adding further subscribers – until they have broadened their network capacity enough to take on additional load. It is that simple.
    GBAM. Nuff said. Nigerians most nigerians cant afford to pay premium. Remember when gsm first started in nigeria? The price was high, service was superb but profit was low. Nigerians then wrecked the networks with ‘flashing’ forcing networks to create call me back service that still put the network bank accounts in red. NCC should make sure NO sales beyond its capacity. Remember majority of gsm users live on less than a 1dollar a day.

  12. @Yomi

    Not true. ECONET was locked in a bitter price war with MTN from the word go. As a matter of fact , they were always the more affordable of the two networks .

    ECONET – Airtel is where it is today because of persistent boardroom squabbles over the
    years .

    I was staying on the eastern part of the country in the early days of GSM. My understanding was that whereas MTN were busy spreading to the major cities and towns in the eastern states, ECONET were busy trying to offer the best of service as they could then, within the towns and cities they have their presence and it was observable fact that call quality and stability of ECONET was better than that of MTN then.

    Because of the dismally low teledensity of the country before GSM came in, people were so starved that they would make do with or at least condone the kind of poor service offered by GSM operators then which was why MTN kept expanding even the quality of their was worse than ECONET services generally then.

    1. Harry,

      I agree with that storyline. But if ECONET had stuck with that approach and not allowed the petty boardroom squabbles – and the subsequent sales and rebranding exercises to distract them – they would be the network to beat today.

      Back then, ECONET had a very loyal following that they could have built on.

  13. I quite agree with the NCC fingers. What happened to having/creating standards and upholding them?
    Recently in Ghana,the telecoms commission fined MTN,Vodafone and Airtel for poor QoS despite the fact that MTN claimed construction workers were tampering with their cables….who cares??? Its their responsibility to put up signs wherever need be. If NCC can’t stand for the interest of Nigerians, who would….#OccupyNCC ???

  14. This is a country where everything goes, our service providers can behave as they like, provided money is exchanging hands somewhere (Please i don’t know where)our Communication Regulator are big big men, provided they stash there bank accounts with cash and make their free calls, they don’t care! let the masses go to hell! if you advise them to sanction the network providers, oooh the money will still enter the same place (their pocket) so i really don’t know what to do with this country called Nigeria.

    Now what Etisalat does is to automatically deduct my money for BB Service without giving me the service, call their customer care, they will tell you that they are sorry, and they will go ahead and repeat it again, the worst of it is that the deactivation code doesn’t work anymore, Oh God when will you come and save us in this country?

  15. I am actually a sucker for low prices and I hopped on the etisalat train to my utter disappointment.However I would like to say that in a very undeveloped country like ours,price is a very determining factor in all we do.This is why there are cheap and substandard goods everywhere in the Nigerian market.

    I can confidently say that the number of persons really willing to pay good money for quality goods or services are in the barest mininum.Remember china phones?It actually took nokia phones for EMERGING MARKETS to knock them off the wish list of many nigerians.Me thinks we still have a long way to go to actually pay for quality.

  16. @infection
    thank God i thot am d only one havin problem with etisarat .. I loaded three thousand on my bb sim card and i went to one village to work coz etisalat network z not good there i had to leave d sim at home and i was hopin to use d credit when i get back.. When i got back i found 0.00 in d account i call dere customer service dey said ehn dere bb service auto reactivate that i shud deactivate by dialin 399 blablabla.. Till today am still tryin to deactivate it and it not working and everytim i load d fone they wnt even ask before deductin it… Foolish network

  17. Yomi’s article is right on point on several issues raised.

    For me, etisalat meets my needs for data and voice so no need for me to maintain multiple lines. As at the time, glo reduced BIS to 1400, I still went ahead to pay 3000 for etisalat BIS to the surprise of my friends and colleagues and even if they didn’t reduce their BIS, I still would have paid 3000 again this month.

    For me, price is never an issue, quality is. But in a society like ours, price comes first before quality.

  18. This past few weeks since the launch of Etisalat’s BB complete plans have been excruciating painful as the network has gotten slower.

    I really wouldn’t have minded paying the 3k monthly fee if the service had maintained its quality!

  19. I will say this because i also am affected.
    Etibaba’s data plan of 500mb was blazing fast at 3k, now that is has been lowered to 2k it is so slow, imagine that i can not install bolt or any java app, all it tells me is disconnected. And for those defenders i have 3g at my location and yet all this happens.
    Finally its time to tell this network providers that we are tired of their nonsense,and if eti hardly stands how much more airtel xhai

  20. @good
    i agree with you.. its so saddening to find out that even upon availavility of the 3g,that still doesnt guarantee quality service.you can have the 3g/HSPDA indicating on your device throughout the day and be experiencing 2g speeds. thats ridiculous

  21. Our GSM provider are more apt to make billion of naira as profit within a short period of time they are not after quality service and they are not to blame entirely for this. There no better alternatives to them. In a country where there are better alternatives like WIFI and where people can access data through cable in house without hazzles they will do better.
    In the long run it is only the organisation that can provide the best quality service with adequate infrastructure that will rule the market.

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