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The people of Nauru stand to benefit tremendously from the announcement of Digicel, the fastest growing telecommunications operator in the Pacific, confirming it has been awarded a GSM licence in the Republic of Nauru. Starting in August, Digicel will launch operations in its 32nd market worldwide. You can read the full announcement here. With a a presennce in Nauru, Digicel looks to further its commitment to the development of a true Pan-Pacific network.
Nauru is the 6th Pacific Island nation that Digicel has entered. The others are: Papua New Guinea, Vanuatu, Fiji, Samoa, and Tonga.
Some comments from Digicel Pacific CEO, Vanessa Slowey:
Ms. Slowey praised the Government of Nauru’s determination in bringing world-class mobile telecommunications to the people of Nauru and added that, “We have been working alongside the Government of Nauru for the last six months in ensuring that this investment will transform the lives of all Nauruans and we have been enormously encouraged by the sheer drive and enthusiasm of the entire team from Nauru who have worked tirelessly and diligently on this project. Digicel is totally committed to building a hugely successful business with the Government of Nauru and ensuring that everybody in Nauru has access to the service”.
You can download the full news release from Digicel, here.
This is the transcript of a phone interview conducted recently with Digicel Pacific CEO, Vanessa Slowey. I want to take this opportunity to thank the Digicel leadership for the genuine spirit of cooperation which they extended to me. Their openness and willingness to answer difficult questions is a good indicator of how they view their committment to the Pacific Islands.
1. In which Pacific countries does Digicel operate in at the moment? What countries are next in line for Digicel service?
Digicel currently operates in five countries in the Pacific: Papua New Guinea, Samoa, Tonga, Vanuatu and Fiji, covering a total population of 7.5 million people, and directly employing more than 1100 people across the region.
Digicel began its Pan‐Pacific roll‐out when it launched Samoa’s first GSM network on November 1st 2006. The incumbent provider there was operating a mobile service over nine towers on a second‐hand switch. Needless to say, Digicel’s arrival to market has transformed the telecommunications industry in Samoa with an increase of 150% in mobile usage.
On July 24th 2007, Digicel’s launch in Papua New Guinea marked the end of a fifty year monopoly in the telecommunications market. To date, Digicel has invested US$150 million in Papua New Guinea with plans to invest a further US$340 million over the next three years. The Minister for Finance has directly attributed a growth of 0.07% in Gross Domestic Product (GDP) to Digicel’s launch in Papua New Guinea.
Digicel has invested US$150 million in Fiji with ongoing investment throughout and across 300 islands in the group. Prior to Digicel’s launch, the incumbent operators scrambled to get organised as even the threat of Digicel coming to the market scared them. We have witnessed a revolution in Fiji with Digicel’s arrival here, as prices have been driven down and now customers are experiencing real competition for the first time. Read the rest of this entry »
The ingenuity of users to take up offerings and adapt them to their own needs can mean technology is used in a way the designers might not have anticipated. That’s really the definition of disruptive technology.
As Digicel and Vodafone begin early rounds of jostling for market share, it might help consumers in Fiji to understand what the possibilities for the technology are. Consider the example of mobile banking in Kenya. The incumbent operator Safaricom (a Vodafone partner) launched a service that would allow for prepaid cell phone plan users to send minutes to family members. The service was immensely popular and allowed users to apply the technology to solve other problems:
According to Eagle, local incumbent Safaricom had started a minute-sharing service for its prepaid cell phone plans a few years back. The idea was to enable users to send minutes to family members in rural areas, who weren’t otherwise able to buy prepaid phone cards. However, Kenyans quickly came up with other uses. “Lots and lots of people were using it as a surrogate for currency,” Eagle said. “[You] could literally pay for taxi cab rides using cell phone credit.”
The use of mobile phones in this manner has been a key part of how technological innovation has transformed Kenyan society for the better. Unlocking the keys to these kinds of possibilities requires the ability to be responsive to the needs of customers . Can we count on our local mobile operators to come up with such ingenious offerings? It might be helpful to look at the types of promotions being put out by Digicel and Vodafone and see if it offers us a glimpse of future possibilities.
Digicel clearly is looking down the road and recognizes that wide take-up of mobile internet service offers a lucrative revenue stream. Their current offering includes access to 1 gigabyte of internet use. They must get praise for offering promotions that propagate cutting-edge technology to users.
Over at Vodafone, their messaging seems to suggest that they are willing to concede first-mover status to Digicel. They are aware of the fact that few people are willing to actually make the switch between providers and that Digicel’s early inroads will come from previously unreached users.
Word of their offering came to me via an article on Fijilive:
“The reduced call charges of 5 cents a unit can also be enjoyed from 12am (midnight) to 5am every other day of the week for the month of March,” Prasad said.
Come on Vodafone, that’s the best you can do? Offering for two weeks, the chance to make phone calls at reduced rate, in the middle of the night? To be fair, that was just one part of the promotion. Text messages have also been reduced to 5 cents, but its unclear if that is also just for the two weeks of the promotion.
We’re left with questions like, “on what days is the promotion actually valid?” Undoubtedly Mr. Prasad will straighten it all out in upcoming letters to the editor of the newspapers. It is concerning to see that Vodafone’s marketing effort still has the markings of the bad-old monopoly days. Maybe they have chosen to see what kind of progress Digicel makes before they get serious about making offers on new services?
A new type of mindset is needed to foster the development of innovative ideas. We see progress coming from so many different parts of the world. If we are to plot a course from today to the point where services like the one in Kenya become commonplace in our own country, then we need to be able to count on our operators to show some vision.
Safaricom users can use their mobile phones for a wide range of banking services
It seems like just the other day that I was writing about Digicel’s arrival in Fiji. 
Well, it’s safe to say that their impact has been immediate and significant.
Earlier reports confirm what everyone in Fiji already knows about mobile calling rates. Digicel entered the market in October of 2008 and since that time incumbent provider Vodafone has slashed rates by 44% to hold on to market share.
Peak rates for Vodafone “on-net” calls have been dropped from 27 cents a unit to 15 cents a unit or 30 cents a minute in comparison to 54 cents previously. Off peak rates have been slashed from 18 cents a unit to 12 cents a unit or 24 cents a minute. SMS charges have been dropped by 50 per cent to 10 cents per txt compared to 20 cents earlier.
As these two companies battle it out, it should be consumers who rejoice. 
Real Competition in the mobile sector will mean continued improvements in these areas:
- improvements in call quality
- expanded coverage areas
- responsive customer support
- more frequent releases of services and features in-demand with customers
And really, the list of benefits is far too extensive to be detailed here. The real measure of the success of Digicel’s entry into the market will be made several years down the road.
Digicel has built its reputation on monopoly-busting in small markets all over the Caribbean and the Pacific and there’s nothing to indicate that they will stray from their credo as they expand in Fiji.
Announcement of their donation of $500,000 to assist victims of the recent floods in Fiji, as well as their plans to build a green-powered mobile network in Vanuatu show Digicel’s comittment to being a genuine partner in the Pacific.
For 14 long years, Fiji has suffered under a telecommunications arrangement that granted exclusive licenses to operators and prevented the entry of new companies to challenge these monopoly agreements. As a result, Fiji has had to endure terrible service, non-existent customer support, prohibitive pricing, and a host of other issues that one would expect when monopolies rule the day.
No longer. With the entry of Digicel into the mobile market in Fiji today, there will be real competition in the mobile market. Benefits to the consumer will be immediate. Already, Vodafone has started slashing rates to compete and in unprecendented moves, has even responded to widespread customer complaints about SMS promotions. Offering competitive pricing, excellent customer support, and the genuine motivation to shake up the market, it will not take long for Digicel to make a serious dent into Vodafone’s business.
Digicel stores in Suva open at 8 AM and the company is putting on a free concert at Albert Park, where a crowd of 60,000 is expected. The show will feature Sean Kingston, NZ-based Katchafire, and several local artists who get the thrill of playing for the largest crowd ever to gather in Fiji (for a non-religious event). The people of Fiji are not used to being shown any sign of appreciation from the companies they deal with. For a company to thank them with a free concert, before they have even started operations is a clear sign of great things to come.There are areas of concern. While the mobile sector has been opened up to competition, the internet gateway/backhaul function under the control of FINTEL will not be challenged anytime soon. This is an issue that has been dealt with extensively on this blog.
Change in internet will be more gradual and even there, Digicel will be a key mover. As it signs up more people to its data services, expect Digicel to show more interest in investing in internet backhaul capacity. It is only at this point that we can really expect internet service, quality, and pricing to show any movement in Fiji.
Today is a step in that direction.
According to reports from Pacific Magazine, Digicel officials have indicated they will be ready for the launch of their service in Fiji on Oct. 1st. They point to their business in Samoa:
“We offer a first world mobile network with all the bells and whistles,” Slowey added. In Samoa, for example, the government-run telecom company had 18 cell broadcast sites. Digicel opened with 43 and has continued to add more over the past two years, bringing up the coverage now to about 95 percent of the country, with plans to increase that to 98 percent of the nation by Christmas, she said.
“We promised the government of Samoa that we’d provide a minimum of 75 percent coverage (on launch),” she said. “But we came in with 85 percent coverage. We put our money where our mouth is — we deliver.”
Their approach to customer service:
In Samoa and in Papua New Guinea, as in Marshall Islands, the government telecoms didn’t offer 24-hour customer care, she said. The government’s SamoaTel has responded to Digicel by now offering 24-hour customer service, she said.
“In PNG, our 24-hour customer care was unprecedented. People call just to see if someone will actually answer.”
Future plans:
Speaking from her Fiji base, Slowey said the company is operating in four south Pacific nations, plans to launch service in Fiji after October 1, and is talking with other island governments, including the Marshall Islands, about starting mobile phone services.
“We’re knocking on everyone’s door (in the Pacific),” she said.
Digicel has been properly welcomed to the realities of doing business in Fiji. Several of their sites across the country were hit by thefts and vandalism. According to the Fiji Times article:
It has been confirmed that equipment at sites in Tavua, Sigatoka and Suva have been stolen.
…
According to sources, copper wire from sites in Rabulu, Tavua, Nacuva Street in Suva, Sigatoka and the Malawai Honey Farm in Nadi have been stolen.
In the article, the Digicel representative turned down opportunity to comment further on their upcoming launch (finally, someone smart enough not to make a comment to a FT reporter).
Mr Pritchard also refused to comment on the current progress of preparatory work ahead of the company’s launch in October.
In additional news, an Indian technology firm has signed a multi-million dollar deal with Telecom Fiji. The deal with Tech Mahindra is largely seen as an effort by Telecom Fiji to develop new offerings to remain competitive in the new era of deregulation:
“Looking at Tech Mahindra’s capabilities, we are also exploring possibilities of leveraging on each others strengths to work together as global services partners for providing ICT services within Oceania region to our enterprise customers. We are very hopeful that this relationship will be further developed and can help us grow our service offerings and our reach in the global market,” TFL CEO Taito Tabaleka said .
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