Poor Business Strategy Causing CDMA Failures – Dadson

Alex Dadson, is an interesting person who cuts both a picture of an entertainer and a blue chip chief executive.
He is the managing director of Qualcomm West Africa. In his role, he works with operators, vendors, OEMs and other stakeholders to design and execute CDMA/3G network and devices strategies in the region.
Prior to Qualcomm, Dadson, was managing partner and founder of the Blue Management Group (BMG), a Telecom, Media and Technology (TMT) management and advisory firm he founded in 2006.
A Ghanaian with degrees from prestigious US universities, MIT and Harvard, he chose to return to Africa, specifically Lagos to start-up the Qualcomm office. Barely a year here, Dadson feels at home, although he believes there is still so much needs to be done. He spoke with Miebi Senge.

Qualcomm in the ICT ecosystem
We are a global chip set provider and we like to look at ourselves as a technology point to the telecommunications industry in general. Our technologies are targeted at the heart of mobile devices. These chip sets power mobile devices be it smartphones or tablets; and at the heart of these devices are the chip sets. We are the world leading producer of these mobile chip sets. Now to create more value from the chip sets that we produce, we also get very much involved in helping our clients with their technology issues. We work with operators for example to help them fine-tune their networks.
We work with OEMS to make sure that our chip sets fit properly into their devices. This ensures that devices have the right features, the right key facilities for the target market. We also work with retailers- those who bring the devices into the hands of end users. Developing technology is all well and good but if you do not look at how it impacts the society, then you are just developing the technology for the sake of it.
At Qualcomm, we are interested in that long chain from the laboratory all the way to the consumers’ hands. The way we hook up with end users is through the distribution in the retail chain. We work with all these eco-system partners in all the geographies that we find ourselves in. In Nigeria, we established our office here a little over a year or so ago. We have developed relationships with operators and with local representatives of the OEMs because we know the OEMs from our headquarters, they are our partners so we already know them. But we needed to meet up with them locally and then of course their distributors who tend to have local businesses. But then we had to come to Nigeria and start meeting them and we have been growing those relationships. The whole idea is to make sure that the mobile sector continues to grow and do well in Nigeria.

Technology convergence
What is happening is that mobility and computing are coming together. When you see a tablet for example, a tablet actually is a relative of the phone. A tablet has a SIM card in it which makes it look like a phone so mobility and computing are coming together. Companies like Qualcomm develop a technology that makes that marriage between computing and mobility possible. The modem (technology) in a tablet for example is made by companies like Qualcomm. Without the modem, that tablet cannot get to the network. Some of the protocols that allow the tablet to communicate with the network are technologies developed by companies like Qualcomm. Tablets are very interesting and we make sure that our chip sets fit into that.

Investment in CDMA Technology
It is very true that we have invested big in CDMA technologies. We support CDMA operators to develop chip sets and so on. With time we have applied some of those technologies into the 3G world. We have a thriving WCDMA 3G business and when I talk about our business, I mean not only are we at the beginning of 3G but we are also in this evolution right to technologies like HSPA+. Beyond that, we are still with the 3G evolution right through LTE and beyond – CDMA is an evolution path to LTE.
3G adds data connectivity to the core voice service that you have got in GSM. For example, you have HSPA which is one of the earlier 3G implementation. It supports data rate up to 3.7Mb/ps. HSPA 12 supports data rate up to 21Mb/ps. That is also 3G but you will see that the data rates are a lot higher compared to HSPA+ – that is a defining characteristic for the everyday user.

Data Connectivity
Data connectivity opens up a whole new world of interacting with the internet. It opens up a whole new world of sending bigger text so you can have something like video and calling which is called video calling. You can have a video conference call; that video is fixed data so you need 3G in order to make video calls. Internet and other data intensive transactions are made possible by 3G. Here in Nigeria everyone knows how to make phone calls, swap a SIM card and send SMS. That is wonderful but what next? What are we going to add to these? How do we start tapping into the added value that companies like Qualcomm are enabling in this telecommunications revolution?
That requires a movement towards 3G. The simple devices that we had previously could not carry video but new devices that we have today can carry video. When you carry video across distances, you can do things like educative programme in a village.
The teachers can sit in the comfort of their homes in Lagos and teach children in a village 200 miles away. That then means telecommunications is beginning to impact on education and that is only possible over 3G. You cannot do it with GSM; you cannot do it over voice. All you can do is to call the children through phone but they cannot see you. Imagine trying to teach them A, B, C, D with only voice, that is impossible. They would learn it but would not know how to write it and the way they can learn to write it is if they can see it. It is imperative that we quickly move to 3G and beyond to really tap into the values that telecommunications enable. It is a very important thing for us to do and great, operators in Nigeria have started migrating towards 3G.

Is Technology Moving Too Fast for Africa?
If technology moves too fast we would soon be too late to cure malaria. We take tablets, we get injections and we feel better when we take those medicines.                                                                                                                                                                                                                                                                                                                                                              We do not even manufacture most of the medicines here. That is how advanced those technologies are but there is nothing like technology moving too fast. It is done responsibly. Every country wants to adopt the latest, brightest and best technology available. If we did not adopt more advanced technology for example we would not have cars with air bags in Nigeria. Technology moving too fast is actually not the issue. Technology would move fast because people would try to create more and more value in every technological revolution. The key point is; can we organize ourselves to get on that value wagon and adopt the technology that makes sense for us?
For example, we have heard of LTE, the question is, does LTE make sense for Nigeria today when we have not even gotten video calls right? In fact, there is a reason for using two Sims. If you were a satisfied customer you would have only one SIM card. Why have two SIM cards if there is no certain problem you were trying to solve. Yes, there is LTE but the thing is we have not even got the basis right. LTE would be there waiting for us when we are ready but today we need to deploy what makes sense for us. That the 3G network has been deployed by operators is a wonderful step in the right direction.
The investments that they have made can be leveraged unto higher and higher data rates. An operator who deploys HSPA 3.6 has a very clean evolution plan all the way to HSPA 5. In fact when they get to HSPA 5, we can even combine two HSPA carriers and give them double HSPA plans. At that point you can have 42 Mb/ps. The question to Nigerians is: what would you do with it? That is the question because LTE would give you 100, 200 and more, what would you do with it? We have to answer that question as we make our technology choices. 42Mb/ps could probably address education, it could probably impact banking, it could impact the oil sector and so on but if at that point we feel we want even more, then LTE would be there.LTE would be there for us to adopt but we should not deploy technology for the sake of deploying technology. We should deploy it to address key problems on our society. That is our position.

Solutions for Failing CDMA Business in Nigeria
The CDMA situation in Nigeria is an interesting one and I have stated over and over again that the problem is not the technology. Let me tell you why the problem is not the technology. With a CDMA phone, you can make a phone call just like you can make a call with a GSM phone. You can take a CDMA phone and send a SMS. There is also no problem with that just like with GSM. In addition, in CDMA you need the most basic phone and with that you can actually get data connectivity.
One megabyte on CDMA actually gives you good data connectivity; you can use that to get on the internet. You actually cannot do that with GSM.GSM becomes competitive for data connectivity once you deploy 3G. On a technology basis, CDMA is actually quite competitive: so then what is the problem? The true problem and this is not related to just telecommunications. The key problem is one of business strategy. It is more of the environmental factor that affects you business and how you manage it.
The CDMA while it was an early entrant was also disadvantaged. We did not start out with nationwide CDMA licensing. There were riggings. The interconnect regime weighed against CDMA. All these problems have been subsequently fixed but CDMA took a beating as a result of business strategy, as a result of environmental factors and so on.
Today, CDMA has access to broadcast infrastructure. They have access to a growing number of local devices. One of the most recent things QUALCOMM did was that we have put GSM and CDMA on the same chair so your phone actually has two Sims. That is why you can use two SIM cards on a phone. We have now created a single chip that can accept a CDMA SIM and a GSM SIM. You do not need two SIM cards (anymore) because we have put it all on a chip. Again, that is something that gives value to the CDMA. We are saying that somebody may choose to be on a CDMA network because of the quality of service.
In Nigeria it is well known that the CDMA quality of service is actually quite high but they may also want to be on the GSM network in order to get in-network tariffs to call their friends and family. Qualcomm has enabled a chipset that allows you to have two SIM cards in the same phone. This is essentially an innovation that enables the CDMA side of the house so CDMA also have technology development happening in the background.
The CDMA sector is no where near over as Qualcomm and other companies are competing to innovate in the CDMA sector. What we need CDMA operators to do is to put together the right business strategy to attract the right partners, financiers, technology partners and so on. With all those pieces in place, we believe that they can actually continue to do well.
Today in Nigeria, there is a CDMA player that actually adds subscribers to its network every quarter. It is not losing, it is gaining subscribers and this story needs to get out there that in spite of all the odds, there are some CDMA operators who are adding to their numbers today and what they need is the support of the industry. They need the support of the regulator; they need the support of Nigerians. Some of these CDMA operators are people you and I went to school with and supporting them and supporting the jobs that they are creating is also the right thing.

Would Mergers and Acquisition Help
Mergers and acquisition help just about every industry. It sometimes helps and then it sometimes creates value and sometimes destroys values. It is a tool that we should look at but we should remember that most  mergers and acquisitions kill innovation and it needs to be done where it makes sense and that could help the sector in general – both GSM and CDMA.

State of Local OEM Market
The OEMs (Original Equipment Manufacturers) of PCs are well established here. We have local representatives for the various PC manufacturers in town and so they tend to be very well established. You have the Microsoft office here in Lagos which supports all the PC manufacturers. We also have indigenous PC manufacturers. The OEMs on the PC side seem to be thriving. The interesting thing is that there is a coming together of mobility and computing so the PC OEMs and PC distributors actually need to start thinking about the mobile future.
It would make sense for a PC OEM to start thinking about tablets (by 2012 if they are still selling only PCs, then they are missing the point). They need to have a tablet or two on their line up and one of the biggest shortages with fakes in Africa in general are textbooks. We are the youngest continent on earth because we do not have textbooks. Why are there no e-readers? How do we educate that young population when we do not have textbooks?
Well, technology has answered that question. Deploy e-readers!