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2014 was not business as usual – MTN SA CEO

Farroukh looks to finalising MTN’s transformation in 2015.

MTN SA CEO Ahmad Farroukh says that it was definitely not business as usual in the South African telecommunications market in 2014

2014 was a heavy year. This is according to MTN South Africa CEO Ahmad Farroukh, who said that the telecoms industry underwent a “massive transformation at a fast pace”.

“While some people attribute this quick transformation to the new termination rates, this was only the tip of the iceberg and not the real cause,” said Farroukh.

He explained that consumer preference and behaviours changed, and that data usage increased in multiples.

The massive growth in data use left operators worried about their network capacity and accelerated capex deployment.

This situation is exacerbated by the absence of frequencies that can make it easier for the operators to cope with the surge in usage.

“With this going on, operators were left with no other choice but to look at their cost structure. The South African market was not prepared for this,” said Farroukh.

Changing operating model

Farroukh said that his biggest concern in 2014 was that “it was not business as usual” for the industry.

“Whether some deny it and blame it on MTR (mobile termination rates), in reality it is not,” he said. “Our operating model needs to change.”

Farroukh added that many stakeholders insist that it is business as usual. “They need to transform their business model to align with the new realities in the industry,” he said.

The MTN SA CEO said that he looks forward to finalising their transformation in 2015, and getting their health check done to be ready for the new realities in the market.

“We will provide the best value proposition to our customers, staff and shareholders,” said Farroukh.

What keeps you up at night?

Farroukh said that his biggest challenge is meeting data demands without the needed frequency. “In other words, missing the quantum leap of LTE if we do not execute our plans,” he said.

Another challenge, said Farroukh, is to convince their stakeholders and the regulator that the only way forward in this industry is consolidation. “Operators will have a common stand to cooperate with OTT,” said Farroukh.

This article was first published on MyBroadband here and republished with permission.


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