Muyiwa Ogungboye is the managing director of e.Stream Network, an internet service provider.
He spoke to chike onwuegbuchi on issues around e.Stream Network’s decade of service delivery in Nigeria as well as it expansion plan to other cities with LTE technology.
eStream 10 Years of Operation
eStream was founded on March 2006, so, we have clocked 10 years old. As an entrepreneur that saw a problem in the country in terms of connectivity and providing a solution to it, that was how eStream was formed.
We started with VSat as means of communications. Ten years ago, the fiber network in Nigeria was limited, radio connectivity was also limited. Mainly, satellite was the choice. As years go-bye we found that there was a need for us to start incorporating newer technologies in our network.
To that end, we have put in fiber and radio. We still have satellite running up to date.
Actually, over the past ten years, it has been challenging. The situations in the country are such that dollar has never been stable, all the equipment are bought from abroad, government regulations have been tough with accruable multiple taxation. Accessing funds from the banks is another major bottleneck we encounter in as we pursue growth. In all, we have been able to weather the storms.
Generally, I will say that it was the urge to solve problems in the country that manifested in having eStream come to live. We also want a situation that indigenous companies can be perceived as capable of executing, even better projects, what Americans and Europeans are doing for us. So, during the course of our ten years, we also obtained our certification on quality management. I think we got that ISO:1900 certification when we clocked seven (7) years.
The whole idea is to prove to the outside world that there are some indigenous companies that can do it in the right way. Corporate governance is something we hold very seriously in this organization. Quality is also something we don’t play with. In all, it has been challenging and interesting in the life of the company.
Moving forward, we intend to expand our network on fiber and especially on radio. There are some sub-marine cables that have come into the country, but the problem is distribution. It is a factor to induce results in the sector.
Last year, we came up with a five-year business plan. When we started the company ten years ago, the business plan we had was exhausted at about the fifth year. Another one was written, which ended last year. So, our focus for the next five year is majorly on expansion.
Right now, we have agreements on colocation on certain base stations across the country, but we also want to invest on some of those base stations. We have some already, but we are expanding. Like in Onitsha, the ones we have are not enough. In Abuja we have one and we will launch another one before the end of the month. There is an existing one in Calabar, we want to launch another one there too; so that we can cover the larger part of the country and also the hinterlands.
Secondly, we just signed an agreement with Bitflux, which won the licensing for deploying LTE in Nigeria. But by the law they can’t sell to the end users, rather through internet service providers like us. We are one of their major partners. The base stations we are building will help in spreading their signals across the country; it is a collaborative drive where they set up some and we do too. We also have plan for setting up our cloud services. Discussions are on with Microsoft and Dell for the purchase of the software and hardware. We expect that the cloud will soon be up and running.
For the LTE, it is not going to be working only on WiFi or MiFi; it will still work on mobile as well. It is not restrictive; as long as your phone has the capacity of working on 2.3GHz spectrum, the signal will work. We are spending a lot of money in setting up these base stations. It costs a minimum of N20million to set up one base station. If we do some arrangements with people that have buildings, we will be spending N10 to N12million. That is going to be the major drive of our services.
Investments on Distribution
For this year, we have a budget of about $1.2million. What we did was to break down the five year plan into yearly focus. That is why, this year we are focusing on coverage. By next year, it is going to be more on Value Added Services (VAS), because the coverage would have been established. Then, we have plans to have a TV business. TV perfectly works on satellite. We are trying to incorporate IPTV into our existing business. That will probably happen by next year. Our team is already having talks with a Kenyan Company. We have visited each company’s facilities; we are hoping to tidy up the agreements this year, so that by next year we can launch our IPTV business.
End-Users Services against Corporate Services Delivery
What heralded the birth of our Company was due to the challenge in the corporate market, basically, connectivity. We have achieved a milestone on that, however, we also realized that in the retail or mass market sector, what is focused on is mobile, be it MiFi, or mobile phone, that was what led us into signing agreement with Bitflux. It is basically to solve some problems in the mass market segment. But you know that as at today most of the mobile internet services providers are on 2G/3G. None of them is actually what is regarded as full 4G. What we intend bringing on board is the pure 4G service which has a minimum of 10Megabytes per second. Anything short of that is not 4G, but most Nigerians do not understand the definitions of 2G, 3G or 4G. If the public is educated on how to test the service they are getting, they will understand better. Therefore, we want to bring alongside, education on 4G. It comes with exceptional speed at a very competitive price. You can imagine getting 100megabytes per second for as little as N5,000. As I speak, it is already happening in some locations in Lagos such as Ikoyi, Victoria Island, among others. Our focus is that before the end of the year, Lagos State would have been covered. With that, you and I will have access to affordable, reliable and exceptionally fast internet connectivity. In Europe you get a minimum of 12megabytes per second. They are advanced, because on the move you want to watch CNN, BBC, skype with your wife or husband. These services need big bandwidth, which 2G or 3G cannot really offer.
True Value Of What Subscribers Pay
We are already in mobile, just that the devices that will support our 4G services are not yet available. I want to believe that before the end of the year, it will be available. As we speak, Huawei is already producing 2.3Ghz phone which is compatible with our services. I want to believe that organizations like Samsung, among others are thinking towards that direction. We don’t want to be restrictive in such a way that you must buy our particular set of mobile phones. No. let people have varieties. It will definitely happen.
On whether other companies offer real 4G, I wouldn’t want to quote companies, but what we have experienced is that some are still deploying 2G or 3G. But they say it is 4G. Education needs to come in, the Nigerian citizens to understand the differences. A typical 4G services have minimum of 10megabytes speed. But 2G is like 2megabytes while 3G gives about 4megabytes. It is not enough to watch Nollywood content via the mobile phones, but people need the services real time. Only 4G can accord you the pleasure.