The Business Year

Sunil Colaso

Managing Director, Airtel Tanzania

Ian Ferrao

Managing Director, Vodacom Tanzania

What do upcoming IPO listings mean for your company and Tanzania’s technological and financial make up? SUNIL COLASO We are doing this IPO in compliance with Tanzanian law. However, it […]

What do upcoming IPO listings mean for your company and Tanzania’s technological and financial make up?

SUNIL COLASO We are doing this IPO in compliance with Tanzanian law. However, it is clear that an IPO will help improve the transparency of a business among all stakeholders, as well as raise capital for continued investments in an industry that requires significant investment over time. More importantly, local Tanzanians have an opportunity to participate in the growth and progress of the company. The news that the IPO will be opened up to international individuals and companies is also a positive development. The move will open up Dar es Salaam Stock Exchange (DSE) to the world by bringing in more players and making it a more active and dynamic stock exchange.

IAN FERRAO From a financial point of view, the listings will be transformational for DSE, adding a significant amount of market capitalization. Vodacom has been present at various roadshows in the region, and this brings more visibility to DSE, which will hopefully go a long way toward improving the liquidity and levels of trading volumes. This will be beneficial for all companies that are currently listed on DSE and improve the financial landscape more generally for Tanzania. From a technology point of view, our vision is to lead Tanzania into the digital age and use the latest developments to continue changing lives here. In line with this vision, we are evolving our technology at the same pace as most emerging markets. Using M-Pesa, we can turn Tanzania cashless faster than any other market.

Which global advances in communication would Tanzania benefit from taking up more rapidly or more widely?

SC Consumers here like a simple value proposition. Today, 90% of our sales are made through bundles, which take care of basic needs and ensure reliability and simplicity. Similarly, SMS is our biggest market in Tanzania, with many customers responding to SMS technology in terms of promotions. Airtel has worked with this demand, and is developing products that are easy to use and cater to this desire for reliability. According to the Tanzania Communications Regulatory Authority’s (TCRA) current report on data usage, data traffic has grown from 12% to 40% from 2011 to 2016. We are investing heavily in our network to ensure we continue to provide quality data services that suit customers’ growing needs.

IF We are truly missing well-developed local content. I am driving for more local Swahili apps in the market as this will rapidly drive internet penetration. We are different from surrounding markets in which English is the primary language, and apps from the outside can be quickly and easily replicated and brought to those markets. Swahili content would be extremely popular in Tanzania, and if the right people came into the market and were able to drive this, then we could have booming local content development here in-country. Vodacom is doing its bit to encourage this. We have partnerships with a number of local entrepreneurs and tech start-ups. One example is M-Paper, where we virtually distribute local newspapers, making them available for download. This partnership is starting to thrive, which has driven us to be on the lookout for more such partnerships to develop.

How are you harnessing industry developments to boost social and youth empowerment?

SC Airtel has pioneered what we call Vsomo, an educational lab for vocational training. We have partnered with the government on about 10 vocational professions. It is a mobile-based training and hence can be done at the convenience of the participant. The participant studies the theory on an app, and once he/she passes the theory, he/she can obtain a practical training certificate from a government institution. With the certificate, he/she can apply for a job or start an apprenticeship. More than 30,000 people completed the training on the app in the last year. We have also developed a program called Amsha Popo, which is a franchising model that enables young people to own a store of 10sqm. Today, we have more than 500 such stores in Tanzania, with more than half of them profitable in the first two months of opening. This is a great model to empower young people and has a massive brand impact, taking Airtel closer to the consumer.

IF Youth are incredibly important given that 35% of the population is below the age of 14. As consumers, they are coming on-stream now and will probably adopt data faster than older customers. We are focused on education, health, and financial inclusion, and have many active programs in those areas. M-Pesa allows young people to seek loans to start businesses. We use their usage history and consumer profiles to help banks vet credit and allow them to lend money to start businesses.



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