As an active participant in Nigeria’s ICT terrain for several years, Medallion Communications provides interconnect and co-location services. In this exclusive interview with IT Edge News, MARTIN EKPEKE, the chief executive officer of the company, Mr. IKECHUKWU NNAMANI speaks on telcos and VAS operators, and what data centre could mean to the country’s quest to becoming Africa’s ICT hub.
What has been the role of Medallion Communication in Nigeria’s ICT space in the last one year?
As you know, we are a prime carrier neutral infrastructure provider on an open access basis. So, over the last one year in particular, we have continued with operations, service delivery in the industry, and bridging the gap in terms of marrying efficient service delivery and low cost of operation. That’s what our specialty is and that’s what we have done for the industry. We have been able to put all critical stakeholders together, by offering them cost-effective services that enables them to reach their clients. Our interconnect point is where everybody in the industry meets so this has enabled and sped up the process of people connecting and interfacing with others. So, that alone has been a major impact that the industry is still benefiting from Medallion and we will continue to do so because our strategic goal is to expand on what we are doing both within our current locations of operation, as well as in other new cities across the country. So the more we do this, the more the industry will benefit and the faster the industry will grow. We have seen a number of new carriers of service in the market and we have partnered to work with them in the interconnect realm. Usually,a typical time to market will take from six months to one year; but we have been able to shorten this to a number of weeks with them just because we already have an existing infrastructure that they can leverage on and interface with other people in the industry.
Building data centres seems to be the trend now. Medallion Communications has one. What does this mean to the industry?
The need for data centre service is growing because everybody is looking for how best to operate in a cost-effective manner. First, people come to data centres for expertise they don’t have; sharing of infrastructure like power, cooling, security, transmission facilities and tower base stations. You have a lot of people that are taking virtual spaces on servers; they don’t even want to buy at all because they don’t have the technical and financial resources to acquire these themselves. They leverage on experts that are already into this and run on it. The second is the requirement and availability of local content. Before now, a lot of the services that people run on were posted outside the country. Now we see a lot of these services being developed and posted locally. There should be a neutral place where you have other people you can cross connect and share the available infrastructure with instead of doing it on your own. Imagine if you don’t have multi-running units where people just take up the tool they need, the outcome is that everybody is going to be building his or her own house, but we don’t have enough land space, not everybody has the money and not everybody has the expertise on how to build a good house. So, that is what you see if you don’t have an efficient data centre. In the case of Medallion, we go over and above what we call the traditional data centre service, being that we are also an interconnect operator so what we give to you is not just hosting your servers but also connectivity. That is what differentiates us from these other people, being that most data centres are not carrier neutral. In other words, other data centres depend on an operator that has built a switch centre or a network operating centre for its own use and because they have got more space, they now invite other people to share in it which is unlike Medallion. Ours is purely carrier neutral and built for the need of the industry. Everybody that is critical in the system is hosted within Medallion; all the international fiber: MainOne, Glo1, WACS; they all use Medallion as a distribution point, and that has made it easier and faster to have access to these services because they are meeting at one point. You are not going to different people to buy different capacities from the same location; you can get the capacities you want on different rout. We are the one hosting the Dot.ng servers, Nigeria Internet Exchange Point, Google and a lot of other international infrastructures that are now domiciled within Nigeria. That’s what makes us unique. In terms of client base, I would say we currently boast the highest number of clients in the industry.
Do you think operators, especially the big ones are in conformity with the new interconnect rate NCC launched last year?
Anything that comes from the regulator should be sacrosanct. You don’t go against it. The very day it was pronounced and went into effect, everybody followed it without exception.
The digital migration on broadcasting seems to be struggling, does Medallion have a role in it in terms of interconnectivity?
I think the challenge government is having is national coverage. Given the timeline that we have, we may not be able to have a national rollout across the country, but I know the license of the transmission has just been issued to Pinnacle Communications who won it. Licenses are also been issued to companies that would manufacture and distribute set-up boxes and to the best of my knowledge, enough will be issued. The target is to have about 30-40 million set-up boxes within the first year to cover many households as possible. I think this is because the country is segmented. There are some places that things get to faster than others; things typically get to the north much slower than the south. So, it’s possible that things may not get there at the same time as the others, but I believe it’s fully on course. Medallion is playing a critical role of serving as a point to pick up capacity from long distance providers for some companies that will be working on the transmission side. We are already in touch with a number of them who have approached Medallion to put some infrastructure within Medallion where they can pick up long distance capacity from the long distance provider or fiber. As we speak, we are in the final stages of agreement with these people. Our role will be purely hosting and assisting them with the transmission side of their business.
Operators of VAS are complaining that NCC is not protecting their interest, as big telcos also do businesses that they are licenced to do. Is Medallion into VAS and how will you react to this accusation?
Let me speak on behalf of Medallion. First, Medallion is not into VAS. What we do is to facilitate it. At the moment, a number of the people licensed for mobile money and VAS are working with Medallion. We give them a platform to roll out their services. I can always tell you without calling names that a number of the people that have their money mobile licenses today would not have gotten it if not because they partnered with Medallion in the area of connectivity because they needed access to connect to the telcos and to interface with some of the banks. These are organisations Medallion already have existing infrastructures connected to. We have made that available to them and that was what they rode on. We play the infrastructure provider role to the mobile money operators, we don’t offer those services, and we don’t interface with subscribers. We enable them to work more efficiently and cost-effectively. We have attained success in that regards by enabling a number of them to deploy the concept and operate. That’s the value we have added in respect to that. On the issue of some people operating without license, or not doing it right, I think the regulation is strong enough and I would naturally leave that for the regulators to decide on how they have identified those people and the steps they have taken. I know for sure that once either the CBN or the NCC, in respect to mobile money, or the NCC in respect to VAS, have identified someone is not licensed, they do something about it. Now, the challenge is that there is a thin line between people that have been licensed to offer VAS and the telcos who are also offering similar services. When you have a license from NCC as a VAS provider, you still have to go the telcos for short code; as far as the telcos are concerned, you are just a super-subscriber to them because you are using their mobile plan, and running on their network. So, the rules of engagement sometimes may be tilted towards the telcos purely because of the superior role they appear to be playing with respect to that. Also, I know that NCC is trying to create a regulation that some new class of license will be issued to create VAS aggregators. I am certain that one or two licenses have been issued though they have not been fully implemented because the regulator is not fully out with the license document.
But do you think MTN as an operator, for example, was given licence to offer value added services (VAS)?
It is not fully accurate to say an operator like MTN is offering services for which it is not licensed.They are too big and too professional to do that. I am not speaking on behalf of MTN but from my knowledge of the industry, I think it is the reverse. Sometimes, there is an overlap and could create that impression because if you go through a traditional telco license, it allows you to do voice, data services without breaking it down. Your license gives you a covering for which you can offer other services. Now, the moment you start being specific with your license that is when you can say that your license does not cover this. Mind you, the license these telcos have does not specifically forbid them from doing some of the services they are rendering.
How do we get internet right in this country? There seems to be no headway.
The truth of the matter is that we are expecting too much too soon. It’s like power which has been privatized. Unfortunately, people that do not understand what it means to build power plants, reliable transmission system and distribution system, expect that the very first day that license was issued, there should be a 24 hour power supply the following day. It does not happen that way. It is needed to take two to three years at a minimum to start putting this infrastructure in place before you start to see the result. This applies to the Internet; as we speak, a lot of infrastructure is being put in place. The government through the Ministry of Communication Technology, NCC and even the telcos are doing a lot to solve this. The international fibers have landed in Lagos but the distribution network that would get it to the last mile is not there. It is when these things are put in place that you can see results. I believe that the efforts being made now will bring results within a very short period of time. I am optimistic that with all things being equal, within the next one year, we will see appreciable improvements. The NCC has said it is going to licence InfraCos from August. The role of the InfraCos is to provide fiber transmission facilities that would aid this across various states in the country but we are still dealing with security challenges which even makes it impossible to rout communication in other parts of the country purely because it is not safe to place infrastructure as the infrastructures there have been damaged. Until we solve the interconnect challenges where calls are not moved from different regions to a particular region before it is exchanged, we will continue to have poor quality of service which is one of the things Medallion is working on to establish interconnect service in as many cities across the country so you can localize traffic.