'Sri Lankan market is ready to experiment in video broadband and 4G'

Amali Nanayakkara has a flair for being the 'first' and the only woman CEO in Asia's largest telecommunication provider, Bhart airtel. A seasoned professional with in-depth experience, Amali spearheads airtel's operations in Sri Lanka. Prior to joining Bharti airtel, Amali was working with Unilever Sri Lanka as director, marketing in the personal care division. Remarkably, in a span of under 2 years of her joining Bharti airtel Lanka, the company has been able to record the fastest 1 mn customer base. Considered to be an ever-changing market, Sri Lanka's telecom segment with a teledensity of 17% holds good signs of growth. In an exclusive interview with VOICE&DATA, Amali candidly discusses the company's standpoint in Sri Lanka, strategic importance of 4G, regulatory issues in Sri Lanka etc.

-Amali Nanayakkara, CEO & MD, Bharti airtel Lanka

Bharti airtel is the largest operator in India. What initiatives are you planning to replicate your success in Sri Lanka?

Airtel in Sri Lanka has done remarkably well to successfully replicate Bharti airtel's renowned business model. Airtel Sri Lanka is Bharti airtel's first international foray. In a span of 2 years, the company has been able to record the fastest 1 mn customer base, deploy the fastest network rollout to cover the entire country, and has led in dominating an incremental customer market share. By leveraging this model and its efficiencies, we have been able to deliver significant advantage to the customer through our platform of affordability and an array of life enriching solutions. Through this, we will continue to grow in Sri Lanka.

With airtel Lanka reaching out to 70% of the addressable population for its 2G services, by when will it reach out to the larger base for 3G?

We are very happy to announce that by the end of 2010, airtel expanded its technical footprint across Sri Lanka, to cover the entire country for 2G services. Our 3G services are currently available in the Western, Central and Southern business hubs in the country and we are looking forward to expand the 3G footprint in the near future. Having said that, 3G is yet to take a full bloom in the country owing to high cost of terminal devices and accessibility of user-friendly applications.

Is the Sri Lankan market ready to experiment with digital video broadband and start 4G services? How is airtel Lanka taking this opportunity?

Owing to the mature stage of the life cycle the Sri Lankan market is in, we believe that there is a sense of readiness to experiment in video broadband and 4G. Of course, as with all mobile services, the intent to provide sustainable access to these services either in terms of hardware and software applicability and of course affordability is critical to the success of these services.

The India IDD calls were slashed by 60% and Indian roaming rates by 99% by airtel Lanka. Can we expect the company to bring down the roaming rates in Saarc?

The revolutionary pricing on India IDD and roaming was fueled by the close relationship between India and Sri Lanka. Given the significant cross-border efficiencies between Bharti airtel and airtel Sri Lanka, we were able to leverage this to provide a better and the most affordable service to customers in India and Sri Lanka.

In June 2010, airtel Lanka pledged to invest $200 mn. Can you please provide a break-up of the investment to be made and in which segments?

We made an initial investment pledge on $200 mn at the outset of our entry into Sri Lanka in 2007. Since then, the greater portion of this investment has been utilized in the setting up of all passive and active infrastructure and in gearing up all other services required for a successful operation to take firm root. Of course, we have not limited ourselves to $200 mn. We have surpassed that commitment and will continue to invest further.

What are the regulatory challenges and floor pricing issues that Bharti airtel Lanka is facing? Has the severe price competition caused slowdown in revenue growth?

The national regulator has made significant strides into creating favourable market conditions to induce sector sustainability. For instance, an interconnection charge was determined last year and the national regulator announced the decision for a downward revision of the floor rates effective mid this year. This establishes the regulator's commitment to health sector. On the other hand, market players must concentrate on driving consumption to drive sector revenue, which has been our constant focus.

Presently, TRC is investing a $100 mn on communications tower which is expected to bring together the communication towers of all service providers under one roof. How you think this will influence the efficiency of the SPs?

As I said before, this installs the firm notion that the regulator is committed to the health sector and long-term sustainability by investing its own capital for sector development. Needless to say that infrastructure sharing gives considerable efficiencies to the sector but in Sri Lanka, sharing is a relatively new concept and we are yet to reach optimal levels. It is our view that this initiative will lead the way to greater commitment by the regulator. The SPs ensure greater collaboration and thereby reduce costs substantially.

The island's major operator Dialog has been significantly aggressive with its incremental network expansion program with a $1.2 bn investment. What initiatives is your company planning with regard to its expansion plans?

As I told you before, we have far exceeded our original investment pledge and will continue to make exponential strides such as the fastest network rollout of its kind by any operator in Sri Lanka. Our services will be available on a mark-to-market basis and will compete in all areas of business and services that we are licensed to operate in.

Rural penetration for voice is quite low and broadband is merely 3 lakh subscribers. How is Bharti airtel Lanka addressing this issue? How are you planning to overcome your geographical barriers?

In a nation of 20 mn with over 17 mn SIMs issued, we are clearly operating in a multi-SIM market. Our aggressive nation-wide rollout is focused on leveraging this and we are confident that we are spearheading this growth drive across all markets, be it rural or urban. We are also very satisfied with our customer acquisition drive and all indicators demonstrate a healthy acquisition and retention of a healthy blend of both rural and urban penetration.

Broadband is still to get a hold in the Sri Lankan market. How are you trying to leverage on this?

We have a suite of services offering customized to suit customer usage requirements. These products have gained popularity owing to their relevance and affordability based on customer usage segments. As computer penetration increases and as more Sri Lankans receive access to internet, we believe that demand for our unique offering will take a quantum leap. Of course, we will continue to evolve our services in this area just as in our other services and keep abreast of customer requirements.

The Sri Lankan regulator is planning to set minimum speed standards for ISPs this month. Do you think this will improve broadband internet services?

Yes, it has improved the quality of the service drastically. The national regulator has made a significant contribution in championing quality of broadband services for Sri Lanka at large and we believe that it has enhanced the total broadband offering. This has also renewed interest in consumers for broadband services as the lack of quality standards in broadband had previously led some consumers away from the service. We believe that this far-reaching initiative will contribute to the industry growth further.

Archana Singh
archanasi@cybermedia.co.in