Our next plans, by DCC's boss

Phillip Obiora, managing director of DCC, shares with IT Edge plans to move to the mass market. The company, a member of the CWG, has delivered leading communication services for the corporate market for nearly a decade.

What exactly does DCC offer as a company?

Basically, DCC offer services in three broad ranges. We started as a local area network company, we are still strong there and we are still doing business in that area . We just finished a very big networking job of about $1.7million for MTN at Ojota switch center were we put in a lot of fibres. We have provided similar services at Globacom offices, MTN friendship centres and so on. We also set up metropolitan area networks using digital radios to link up different places within a metropolis, you can only use radios in the metropolis because of the distance limitation and we provided a lot of service for the banks to link up to their head offices. The third area is the wide area network and that is where VSATs have a role to play, they don’t have those geographical limitations that we have in metropolitan area networks using radio. As far as the footprint of the satellite covers between point A and point B, you can provide service, so we have provided a lot of VSAT services between towns or between countries.  We are providing the service in Ghana, where we are also licensed to operate. We offer the connectivity between here and Ghana for a couple of companies.

That is where your relationship with Gilat comes into play then?

Before I go into that apart of using all these products for building blocks, let me some new products we are going to introduce in the near future. We are going into the prepaid calling card so that people can make international call and people and even local calls at a better rate, most of the infrastructures for this are on the ground.

You paint a picture clearly saying that you have had your successful runs and that doing business in Nigeria is profitable.

Yes, I will say we’ve been successful. Doing business in Nigeria is tough, but it can be rewarding. The competition is getting even tougher but I think we have captured a fair share of the market in the areas where we have played and still playing.  For example, we have played mainly in the corporate market but we are beginning to enter the mass market. Apart from the prepaid calling card we are going to launch soon, we are also going to launch two other new products with some level of mass appeal. I cannot put a finger on the exact time these two will come on but we are keen on them.  One will be in the Internet sub-sector. We have that service for selected business organisations at the moment but we are not focused on that.  We are also looking at coming out with a unique product in that area that would have mass appeal.

Let us go back to your relationship with Gilat

We have a very good relationship with Gilat. We started with them long time ago when we installed our first hub. The hub is called the Gilat Faraway hub. It has been running for five years with a number of banks on it. Gilat has shown a lot of support and we have gone also to invest more in their products and that is why we have Skystar360 products. We are soon going to launch another Gilat hub products. What we are trying to do is to provide different services on these products and provide services that are easily affordable. The far away product is a very good product, it is relatively more expensive but we have come out with something cheaper that will give the same functionality and even better but at a cheaper price as you know the price for electronics tends to drop with time so we are trying to take advantage of that and pass on the benefit to our end-users.

You certainly have a good relationship with Gilat but how much of this has impacted on the market in terms of these factors: consider that bandwidth is still very expensive and quality of service is still far from being perfect?

Like I said we started by bringing together different products to build a solution. When you look at a VSAT solution Gilat provides 40% to 50% of the requirements for those companies that use the solution but somehow Gilat’s name still sounds more. VSAT solution involves a number of providers, we had a meeting last night with PANAMSAT, and part of the key thing we discussed was pricing. We were pushing them to cut on pricing and tasking them what would be their response to other solutions like GPRS were coming and what was their response. We wanted to know what were responses of the satellite manufacturers to cheaper prices offered by competing solutions. You can do a lot with GPRS and at a lower cost. For a solution like VSAT, you have diiffrent companies playing very vital role. Their combined role would determine the final price for a solution. We have companies like Gilat playing a role, PANAMSAT or Intesat, Andrews and other equipment manufacturers including people making cables.

In terms of quality of service, it depends on the products you are looking at. The products will directly link to the quality of service that you get. It is actually true that the service level has not been near perfect but like I said, it depends on the product you are looking at. Take Skystar with availability of 100%, it works beautifully well. Other factors are the bands, whether it is KU or not, each has its advantages and disadvantages. There also technical issues, the Far Away is not a shortcut, it gives you the authenticated bandwidth you are applying for.  The Skystar or share products work in a different way, what happen is that you share bandwidth and what some companies have done is to put many people there because they to offer something that is cheap. Before you know it, people will start to complain that it is not working well. What they do is that they make a pool of bandwidth that should probably carry ten companies to carry twice that figure and what happens at the end of the day? The system is very, very slow. So it is not the product but how the product has been configured by the service providers to maximise profit

You always like to talk proudly that your hub is here. What advantages does this rub off on the consumers over those with offshore hubs? 

One big advantage is that you have control over the hub and its management. For in stance, NNB called me yesterday. They’ve gone to put two branches on the VSAT somewhere down in the east, and the link slowed down. They called and said they have done this and they want their link to be faster that we can talk about the pricing later. I called the hub and say do this. If the hub were abroad, I am not sure I will be able to respond as fast as that or ensure they get quality of service. We have more control over the quality of service we are giving the customers and you can even take them to the hub and if you are interested, you can teach them one or two things because an educated user is always better. When there are issues, they appreciate more when they understand what we are dealing with. With them, you are sure that when it comes to making a choice, they will make an educated choice.

Does that also mean that it is cheaper for people patronising you than those patronising hubs outside?

Depending on the service you want, ideally it should be cheaper but that advantage is now in the past. If you wanted Internet service, you just want to browse, a hub that is on an Internet backbone abroad will probably give you a better service.  The reasons for this are clear. Number one is that the hub is sitting on the Internet backbone, number two is that what you pay for Internet service abroad is far cheaper; you know they have fibre everywhere. Fibre is cheaper anywhere; when our SAT3 eventually becomes a reality you can provide very good service with a hub that is here.  A hub that is sitting there will give you service on what they call a single hub: it will just go to the satellite and come down where you are browsing. If I were to offer you a service here, I will have the satellite bringing the thing to my hub and from my hub it will go up again to the end user; this is called a double hub service. But with SAT3 that comes on the same bill. In any case, if you are offering a corporate service it is better you have your hub here because I may be able to give a single hub service.  From the end-user, it comes to my hub, from my hub I use what they call radio back-up or fibre-back up- I have 21^st Century fibre in my hub- so I can give you connection on the last mile through radio or fibre to your head office so I can give you a single hub service or corporate services. If the hub is abroad and you wanted to give a corporate service, that means you go from Onitsha, for example, to the satellite to that hub abroad, then you come back again to the hub to the head office in Lagos. You can’t use radio to go from London to this place so for corporate service it is a double hub. So now with a hub here I am able to offer you Internet on a single hub and I am able to offer you corporate service on a on a single hub.

Who are your competitors in this area?

Direct on PC is on the Internet area. But the main competitors in the corporate market are companies like GS telecom and BT.

Virtually all of you have hubs here

Yes, for a corporate market you need to be serious, most of the people that are using hubs abroad are offering Internet service.

And that is one area you are about to enter

Yes, we are going to offer Internet service.

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