Can 9mobile get back to winning ways?
By Kasim Bakare
9mobile, Nigeria’s fourth largest telecom operator has had a chequered history of highs and lows in the highly competitive Nigerian telecom market. 9mobile originally known as Etisalat, a UAE telecom operator, entered Nigeria through a strategic partnership with Mubadala Development Company, an investment vehicle owned by the Government of the Emirate of Abu Dhabi. Mubadala controlled about 70 per cent of the shares in Etisalat along with Etisalat UAE mobile, with Emerging Markets Telecommunications Services (EMTS), promoted by Hakeem Bello-Osagie, owning the remaining 30 per cent.
Etisalat became the operating partner for the Nigerian telecommunications company established by Mubadala to own and operate in Nigeria. Mubadala was granted a 15-year universal access service licence in March 2007. The licence gave it the ability to offer mobile services and also the right to provide fixed-line, voice, data services and establish an international gateway.
In the first few years of its operations, Etisalat gave other telecom operators a run for their money as it had a reasonable market share of mobile subscribers in Nigeria. Etisalat had great campaigns and the brand resonated with millions of subscribers who were enthralled by several offerings of the Abhu-Dhabi owned telecom operator.
Etisalat Nigeria became entangled in a serious financial mess as a result of issues around its corporate governance. Etisalat obtained a $1.2 billion foreign-backed guarantee bond in 2013 to upgrade and expand its operations, but was unable to meet its obligations. The credit facility offered Etisalat’s was provided by 13 Nigerian banks. In fact, Zenith Bank’s exposure to the Etisalat loan amounted to N80bn of the total loan and this was about 3.5% of Zenith’s total loan book. In March 2017, Nigeria telecoms regulator(NCC) pushed for talks to halt takeover attempts by Etisalat creditors and reschedule its outstanding $1.2 bn loan. In July 2017, Etisalat withdrew from the market after its debt was not repaid or rescheduled. It was thereafter that the telecom was renamed 9mobile
In the midst of the crisis, Mubadala, the company’s largest shareholder pulled out its investment and headed back to the UAE. At some point, there were attempts by leading telcos like MTN and Glo to buy Etisalat but it all fell through. However, in spite of these troubles and uncertainties, there have been several efforts at repositioning and rebranding the telco for it to reclaim its lost glory.
Recently, there were reports that three telecommunication giants, Orange (French telecom group), Britain’s Vodafone Group and India’s Bharti Airtel,1 were in the race to take up the investment opportunity and buy 45% of Etisalat’s stake.
In a major decision to drive the rebranding and re-engineering focus of the telcom brand, however, Alan Sinfield was announced as the substantive Chief Executive Office of 9Mobile on June, 1 2020. The company had been ben led in acting capacity by Stephane Beuvelet since November 2018 after the reshuffling of the company’s management
The task before the new 9mobile is a herculean one considering the ground it has lost during the hiatus. One of those challenges would be how it would increase its subscriber base and bring back old subscribers who left the network as a result of the uncertainties that hung over the telco during its crisis. As of June 2020, MTN had 79 million subscribers. Glo and Airtel followed at roughly 52 million each. 9Mobile had only 12 million, down more than at least 8 million from its peak.
Two of the biggest tasks for the new CEO are to win back subscribers while growing revenues as telecom voice services continue to suffer an expected decline. Interestingly, the telco market globally has become a slow-growth environment. Operators are increasingly expanding to non-core businesses like media, financial and enterprise services to pursue growth
Urgently, 9Mobile has to win customers and find ways to grow the bottomline. But in a market dominated by MTN and followed closely by the likes of Glo and Airtel, one imagines how the new 9mobile CEO will pull it off.
The new 9mobile boss seems to have hit the ground running following recent media campaigns by the telco. One of such campaigns tagged “mega millionaire promo” was launched recently. The promo is designed to reward 90 lucky customers with N1 million daily. The telco also revealed its partnership with Transsion Group, manufacturers of Tecno mobile, iTel and infinix, to give out smartphones every hour for 90 days and a grand prize of N10 million at the grand finale.
Speaking to journalists during the virtual launch of the promo, Alan Sinfield, the chief executive officer of 9mobile, said that the promo is one of the company’s ways of supporting and giving back to Nigerians during the uncertain and challenging times caused by the COVID-19 pandemic.
To improve the financial situation of the telco, 9Mobile has diversified its revenue stream by delving into financial services.
In 2018, 9Mobile partnered with Nigerian bank, UBA to roll out 9Pay, a mobile payments solution. Just recently, the telco launched a digital payment solution product, 9PSB, having secured the licence in 2019. The 9PSB aims to provide basic banking services to six million people mostly in rural locations where the population is unbanked.
Speaking on the vision of 9PSB’s entrant into the Nigerian financial sector, the CEO of 9mobile, Mr. Alan Sinfield stated that there’s a huge potential in the market and 9PSB is strategically positioned to expand its operations into financial services. He stated that “We are happy to be the first Payment Service Bank to provide all Nigerians with access to banking services and open up a digital world of possibilities to improve everyday lives. We know that this new development will further improve the country and the people going forward. In 2018, 9mobile partnered with Nigerian bank, UBA to roll out 9Pay, a mobile payments solution while also pushing for a fintech license. We are delighted that we have now secured finale approval for a Payment Service Bank.”
Few weeks after the launch of the unique product, the hardworking boss of 9mobile was on the roads across the country for the customer forum. The forum offered the management of the company to interact with customers and deepen its market penetration.
Speaking on the event on its LinkedIn page, the innovative and customer-friendly telco said: “ In keeping with our promise of superior Customer Experience, our senior management team will be in Kano to host a customer forum event. Our C.E.O, Alan Sinfield, CCO, Stepan Udovicic and other senior members of 9mobile will be on ground and happy to take feedback, comments and suggestions”
In view of the media campaigns and huge investment by 9mobile, it is not out of place to see the telco compete for a seat at the top of the telecom industry in Nigeria in no distant future. Only time shall tell.
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