Thursday, September 21, 2017

Change in chiefs for Ooredoo Myanmar

OOREDOO Myanmar chief Ross Cormack has chosen to step down as CEO from the first international telco to launch services in Myanmar, the firm announced on May 11.

A woman leaves the OOredoo offices at MICT Park.The firm's CEO is also heading out the door.Photo:Aung Htay Hlaing/ The Myanmar TimesA woman leaves the OOredoo offices at MICT Park.The firm's CEO is also heading out the door.Photo:Aung Htay Hlaing/ The Myanmar Times

Mr Cormack will be replaced by Rene Meza, currently the managing director of Vodacom Tanzania. Mr Meza has made emerging markets a specialty as he has occupied senior positions at telcos across Asia, Africa and Latin America, according to Ooredoo.

“Ross feels that he’s achieved what he wants to in Myanmar with Ooredoo Myanmar successfully established and he feels that the time is right to look for a new professional challenge,” said Ooredoo Myanmar senior public relations manager Ma Thiri Kyar Nyo yesterday. She added it is anticipated Mr Meza will take over for Mr Cormack in the third or fourth quarter of 2015.

Mr Cormack led Ooredoo Myanmar through a highly competitive telecoms tender and challenging licensing process, through to a splashy launch in August of 2014. The company, which recently announced its financial results for the first quarter of 2015, has racked up 3.3 million customers in total – adding more than 1 million subscribers in the last three months.

The company drove QAR236 million (US$65 million) in revenues and achieved a major milestone in March when its operations finished EBITDA-positive for the month.

About eight of every 10 Ooredoo Myanmar users are on smartphones, and average revenue per user (ARPU) for the quarter came in quite high, at K7600 or about $7. That figure is expected to drop as the company rolls out into Myanmar’s more rural areas and poorer regions get hooked up with Ooredoo service.

“What you are seeing right now is the ARPU from the high-income and high-GDP areas,” said Ooredoo Group chief financial officer Ajay Bahri during this quarter’s analyst presentation.

“As we move to more semi-urban areas, I think you will obviously see an impact of that ... And within the urban areas, as we move to the next segment of the customers, I think that one should expect some sort of an ARPU decline.”

The company turned on more than 500 new network sites from the beginning of January until the end of March 2015. Oordoo’s services now blanket more than half the population – 28 million people – and have gone live in all the country’s major cities and half of its townships, including 20 added this quarter.

International telecoms competitor Telenor Myanmar, which began launching services in Myanmar one month after Ooredoo, has beaten the Qatari firm on user acquisition, however, with almost double the customers.

The Norwegian telecom has accrued 6.4 million subscribers since launch, adding nearly 3 million this quarter.

Though the competition between the two telcos is intense, Frost & Sullivan analyst for Asia Pacific telecoms Naveen Mishra stressed that it’s still early days for both Telenor and Ooredoo in Myanmar.

The country only recently opened up and revamped its telecoms sector, semi-privatising the market with the debuts of three international telecoms in the past year: Ooredoo, Myanmar, and Japan-based KDDI in support of state-owned MPT.

Mr Mishra pointed to the smartphone figure released by Ooredoo as proof that many in Myanmar need to connect to the internet.

“The services were not available ... Now [that they are], penetration and subscribers are increasing quickly,” he said.

As for Telenor’s rapid accumulation of users over Ooredoo, which telco users choose could come down to data and pricing.

“Telenor’s offering is more attractive to consumers,” Mr Mishra said.

However, he reinforced that in these initial days, neither telco is better than the other – and said Mr Cormack was likely not replaced due to poor performance.

“Ooredoo is off to a very good start,” he said. “Within a year they are turning the business into a positive business.”

Meanwhile, Telenor also revealed a major leadership change yesterday. Telenor Group President and CEO Jon Fredrik Baksaas is to be replaced by executive vice president and head of Telenor Asia region Sigve Brekke on August 17. – Additional reporting by Jeremy Mullins