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MTN Nigeria upgrading to Telco 2.0

2014.12.10
MTN Nigeria: Upgrading to Telco 2.0

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By Joyce Fan

Charles Molapisi, CIO of MTN Nigeria, spoke with Communicate about how the largest operator in Africa's largest market is upgrading to Telco 2.0 in order to unleash endless possibilities through ICT transformation.

IT in the front

Communicate: How has the strategic positioning of a telco's IT infrastructure changed over the past five years?

Charles Molapisi: In the past five years there has been a lot of discussion about IT transforming from a cost center into a business driver. I think that the time has finally arrived for IT to be much more prominent than it used to be.

It is very evident now if you look at the telco space. I think IT is no longer supposed to play a background role as a supporting function. Instead, it must move forward to take a very critical role in creating a whole value chain across the business. IT is now almost at the forefront in terms of driving new solutions, new products, digital services, and the whole transformation of the business today. Even in other vertical industries, such as banking and logistics, etc., you can't ignore IT alone.

Let me give you an example from the MTN perspective in terms of the role we play in customer experience. We are responsible for enabling all the touch points of the business, such as call centers, service delivery platforms, payment channels, and retail channels, to make sure the customers can get the products they need; we are responsible for customer engagement, the cloud platform, the data center, as well as the digital solutions that deliver all the value-added services. Those are the key business drivers for us going forward. Our role is not just supportive, actually we have to be revolutionary. For example, we are now hosting businesses into our own environment and that demonstrates that IT is in the front.

Telco 2.0: A two-sided business model

Communicate: How would you define MTN's ICT transformation?

Molapisi: My definition is very simple; I see Telco 1.0 and Telco 2.0. The way I see it, Telco 1.0 is for basic services like traditional voice. Telco 1.0 is focused only on the customer, at the consumer and enterprise levels. Now in the new space of Telco 2.0 there's a two-sided business model. One side includes enterprises and consumer customers, and the other side includes banks, developers, and retailers, etc. The whole ecosystem has changed and Telco 2.0 is at the core of that, enabling all of these elements and creating this massive ecosystem of developers, partners, verticals, and consumers who are enjoying all of those services. So it is the creation of a whole new ecosystem and that is what Telco 2.0 transformation is all about.

Communicate: What are the business and technology drivers behind this transformation?

Molapisi: First of all, there is the pressure on revenue. The prices are falling, which pressures operators to bring the cost down. Second, customers want you to know them and to personalize the services. The days of broad campaigns and marketing tactics are over.

The only way you can understand all your customers' needs and offer targeted services is to dive very deeply into data analytics and match relevant products and services with your customers; that is where IT comes in. We provide analytics and the capabilities to conduct marketing campaigns to our customers. We can orchestrate cost-effective and precise analysis. We also have to save the data center cost. Now we can turn the data center into a cloud data center to enable data analytics in a much more efficient way.

New businesses are all about third-party integration, ecosystem creation, and time-to-market. The quicker you launch, the quicker you can make money before your competitors are able to copy you. The service delivery platform (SDP) provides us the ability to integrate partners and bring them on board very quickly.

Communicate: What can we expect from MTN Nigeria's Telco 2.0 phase?

Molapisi: If we go to the Telco 2.0, the possibilities are endless. Once we implement Telco 2.0, our customers will have a plethora of content and services from different partners, because we are the orchestrator who brings everything from different partners and ensures customer take-up.

We can talk about location-based services for example, because that's an area where telcos of our size can really offer value. It means that we will be able to tag our customers, and understand their preferences and location. We will be able to deliver advertisements and services that are much more relevant to them.

Today we are the biggest music distributor in Nigeria. In 2008 we launched our music service, Callertunez, and provided ring-back tone (RBT) services. We reached the 17-million-subscriber mark last October, a record yet to be beaten by any of the other networks. The service currently offers Nigerians a library of over 12,000 sound files, offering subscribers the ability to personalize their RBT. Nigerian artists are provided with a new means to monetize their content. Working with our partners, we made the music distribution transparent. The artists and other parties involved can monitor the subscriptions and download count.

Mobile payment is another example. Infrastructure and transportation are two of Nigeria's challenges. We are going to shrink the gap by collaborating with partners to provide online payment. When we finish the transformation, individuals in Nigeria will be able to make a payment or transfer from the comfort of their home. We've already launched a finance service in cooperation with a local bank. Now, having a mobile phone means you can enjoy banking services anywhere.

All information in one pile

Communicate: How are you getting your IT infrastructure ready for the transformation?

Molapisi: First of all is the integration with content, services, and partners. We have deployed our SDP with Huawei. It's a very powerful and strategic platform for us. With it, we can integrate all third parties with any of their content and value-added services and launch them very quickly. Also, partner onboarding, management, and payment are easy to conduct and monitor.

We are in a business that is definitely driven by analytics. We tag to our customers, develop our solutions, and conduct online campaigns based on that. Our customer management platform and data center help us see the customers. In the past, one of our challenges was that we had separate piles of customer information. We are trying to create a comprehensive view of the customer by collaborating and unifying all information into one pile. We are now moving into big data and will have a very strong analytic platform. At the same time, a transformation in the data center is underway; it's becoming software-defined and everything is moving into the cloud.

MTN is the biggest in the local market with about 58 million subscribers. We've got very strong network coverage and capacity, as well as a solid distribution network. Remember, this transformation is about maintaining the strength of our core business while unlocking many elements around the core – data analytics, music distribution, and payment channels. All those capabilities arise around the core and depend on IT. We are leveraging all the technologies that enable all those elements.

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