At the ready

Afghanistan's largest mobile operator Roshan is bracing itself for increased competition in the war-torn country. With formidable rivals such as Etisalat and MTN now on its doorstep, Roshan's forthright CEO Karim Khoja oozes confidence.

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By  Administrator Published  September 11, 2007

Afghanistan's largest mobile operator Roshan is bracing itself for increased competition in the war-torn country. With formidable rivals such as Etisalat and MTN now on its doorstep, Roshan's forthright CEO Karim Khoja oozes confidence.

How do you think your market share will be affected with the presence of four operators in Afghanistan?

We have to be realistic, Roshan is not going to maintain an approximate 50% market share with this many operators present but I'm confident we'll maintain market leadership.

You don't relinquish market share in a growing market that has approximately 10% to12% penetration overall. We were never under the illusion that we would remain in a position where we'd have no competition.

Everybody seems to forget that we were the third operator and not the first here. However we effectively operated as a monopoly because the competition was so bad.

What we are seeing is the introduction of good competition, which leads to the market expanding. As I see it, what happened in Pakistan is now taking place in Afghanistan.

Prior to the arrival of Areeba [MTN] and Etisalat our average growth rate was about 30,000 subscribers a month, even if we were being quite aggressive. That has more than doubled now.

Okay, there might be price-erosion and a drop in ARPU, but at the end of the day if we are doubling our subscriber numbers, you cannot complain.

Competition is good for revenues, the country and is ultimately good for the customer.

Where Etisalat and Areeba are taking market share from us is in the major cities, they have not gone into the smaller villages and are not experienced nationwide operations. They are only present in the top six cities in the country.

So when they truly go out into Afghanistan, they are really going to learn what the cost base for operating in the country is and will face the issues that we faced as far back as two years ago. I see us as having an advantage there.

How do you see Roshan differentiating itself in the market?

We have a better quality, we have a larger coverage and we have a much more in-depth management team that has been there consistently from day one.

Also, we are in a different life cycle than our rivals are. It's easy to come into a market, steal people from Roshan and double their salaries, but after a year it becomes a stale story and it's then that the true test of management comes into play. I'm not sure they have the same commitment from their management teams as we have.

Is Salem Al Kendi [Etisalat Afghanistan CEO] going to be there for five years? I doubt it. Is Mohamad Toufic Ramadan [Areeba project director] going to be there for five years? I doubt it.

We are into our second re-engineering of our management team, where we'll bring even better people than started our ventures. I've just got a new CTO, who was formerly the CEO of Mobilink and PTCL. That's the calibre of the people we are bringing aboard.

The other area that we are heavily focused on is corporate and social responsibility and Roshan is investing back into the country. All of this breeds joy in a country that is tough to keep in people in.

Both Etisalat and MTN have highlighted how their international presence will prove an advantage over rivals in Afghanistan. How will you compete with such large-scale rivals?

There are a lot of misconceptions there. We already own an operation in Tajikistan that gives a cross-border link for international traffic. We have already announced a product with our operator partners in Tajikistan (both companies owned by common shareholders) where we have one tariff between our mutual SIM card owners. In this sense we are ahead of Etisalat and MTN.

Just a month ago TeliaSonera bought MCT's shares in Roshan and this brought us access to markets such as Uzbekistan, Kazakstan, Georgia and Moldova, which gives us much wider scope for synergies. We are also looking to strike deals with other neighbouring countries in the rural telephony segment, which will enable us to widen our footprint.

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