ICT Company Seeks Investor for $50m Fixed-Line Deployment Project
Nigeria's robust mobile telecommunications market (GSM network) has obscured the urgent need for a fixed line broadband network that can provide stable, high speed, high quality and low cost connectivity.
The lack of such a network means services such as 'Point of Sale' terminals for credit card transaction are barely operational and where they are found, they are running on unstable wireless technology. In addition to restricted services and poor quality, consumers are paying top rate call fees via the GSM networks that could be reduced by 60% if carried on both local and international fixed lines.
Nigeria-based Voix Networks Limited, an information and communication technology products and services provider, is one company that is taking full advantage of the existing gap and aims to become the leading fixed line telecommunications operator in the country.
In 2007, Voix Networks acquired a Private Network Lease (PNL) licence, which allowed it to deploy a network of fixed telephone lines in the capital city Abuja and the six neighbouring states. The 1st stage of the network, built at a cost $50-million, went live in May 2010. The network covers 125 sq kms of fibre optic around central Abuja and encompasses an initial target client market of 50,000 subscribers. The company's clients include: shop owners within major shopping malls, complexes and local markets, major hotels, private residences, security estates and compounds, as well as embassies.
Voix Networks is now aggressively marketing the services and expects to have secured over 50,000 clients in the next 6 months.
Voix Networks is looking for financial partners and investors to maximize its strategic advantage. The company is seeking to raise up to $50-million in tranches over the next 12 months to support client take-up on its current network and to begin the 2nd and 3rd stages of network deployment to extend its coverage nationwide.
Type of investment: Debt and equity finance options will be considered.
A fixed line broadband network offers clients a range of core and value-added services. Principally these include voice, data and video services such as standard telephone calls, fax services and e-commerce services such as Point of Sale (POS) terminals that allow merchants to take electronic payments for goods. They also allow a range of other demand services such as hosted call centres, enterprise solutions for businesses, banks and hotels and emergency response networks.
As a fully fledged operator of a fixed line broadband network, Voix enjoys strong long term revenue streams. In addition to an initial connection charge of $90 per line, average monthly revenue per user fees are expected to be at least N2000 ($15) per month for core services alone. This means that the current deployed network which has a 500,000 line capacity can generate annual revenues of over $100m from just these core services.
Emeka Onyeama, 43, is Voix Network's founder and majority shareholder. Emeka is a telecommunications engineer and is widely regarded as one of Nigeria's most experienced players in West Africa's telecommunications industry. Voix launched in the VOIP market in 2001 and quickly became one of the industry leaders. Emeka then identified the huge potential for a fixed line network and the lack of credible existing operators.