Celtel Proposes Lower Tariff Via Operational Cost Reduction
 1st OCT 2006

Shortly after MTN, its rival operator in Nigeria announced a slash in its call charges, Celtel has indicated an interest in lower GSM tariff regime in the country by proposing strategies for reducing the huge operational cost. According to Celtel’s Chief Operations Officer, Lars Stork, the main route to lower tariff is reduced cost of operation, a factor, generally regarded as the major impediment to lower tariff regime of GSM service.

While presenting a paper entitled, “Commercial Strategies for Cooperation and Expansion” at the Fifth International Nigeria telecommunications Summit held at the International Conference Centre Abuja, last Thursday, Lars Stork, Chief Operations Officer, said the high cost of operation represents one of the main contributors to high cost of service in the country.

The Celtel officer, a business development expert with an extensive work experience in Nigeria and a number of African countries, also believes that co-location infrastructure that can be shared by operators. They are transmission structures, masts and other structures. Methods of achieving effective sharing of resources highlighted include, “one to one sharing, simplified and uncomplicated infrastructure sharing, among others.

He explained that, operators can and should collaborate for the good of the industry and the society by jointly tackling common problems such as impediments to Environmental Impact Assessment; lack of certain basic infrastructure such as the appalling power supply situation; and multiple taxation. Others include mutual dealing with the obstacles to achieve fair interconnection between operators where feasible; and hindrances to stable regulatory environment.

The celtel official said, the mobile telephony would continue to be a vital driver for development as demonstrated by the company’s experience across 15 African countries. He also drew example from the economic edition of March 2005 which reported the outcome of a research at the London Business School sponsored by the Vodafone. The report concluded that “plenty of evidence suggest that, the mobile phone is the technology with the greatest impact on development. A new paper finds that, mobile phones raise long term growth rates, and that, their impact is twice as big in developing nations as developed ones”, saying this evidence further provided a reason for this optimism.

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