High Internet services should be available to everybody —Marinho, CEO, FiamWiFi

August 24, 2020
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Mr Akin Marinho is the Founder and Chief Executive Officer of FiamWiFi, In this interview with Bode Adewumi, Marinho speaks on his interest in ICT and many other issues.

Let us know how your FiamWiFi works?

FiamWiFi provides internet connectivity by installing WiFi hotspots to high density lower income communities and rural communities. We were licensed by the NCC in 2018. We commenced full commercial operations this year after spending the last few years perfecting our business offering. We have installed 25 WiFi hotspots in Ajegunle, with plans to install another 150 in Ajegunle before the end of the year.

Why did you decide to go into WiFi hotspot?

The majority of Nigerians accesses the internet through a smart or feature phone and they typically buy data and when they need it and usually 1GB at a time. The price for 1GB typically ranges from N300 to N1000 and these plans are usually time sensitive such as daily or weekly validity.

People who can afford to pay N10,000 or N20,000 at a go for a monthly plan will pay about N150 per GB depending on which network they are on. In addition, the average Nigerian who earns N30,000 or even N50,000 a month won’t be able to afford a N10,000 unlimited data plan as they have other expenses to take care of. Therefore, the vast majority of Nigerians are penalised for buying data in small bits. This we believe is unfair. High speed internet should be available for all irrespective of ethnicity, class, gender and age. The benefits of high-speed internet are well-proven and the World Bank, the UN and other organisations such as our partners at the Alliance for Affordable Internet, the US based non for profit, have studies which show this and that 1GB needs to be priced at below two per cent of income. We will be, subject to NCC approval, offering 1GB at less than 1 per cent of the national minimum wage – N200 for 1GB of data. Our pricing is clear, simple and transparent and we don’t have time sensitive plans on our data plans have no expiry or validity period.

How commercially viable is this business, especially in your areas of coverage?

Our initial target market is Lagos and other high-density cities outside Lagos.

Our strategy is to create a community network. Currently, we operate in Ajegunle and 90 per cent of our staff for Ajegunle business FiamWifi AJ City Internet all live in Ajegunle. This means our customer engagement team, our site and technical maintenance teams are all residents of Ajegunle, so we create additional employment in the communities we serve. This is the model we will roll out across Lagos and beyond.

What makes us unique is our strategy; we drive down the cost of delivering connectivity to communities and ensuring we integrate into the communities we serve.

 

How will people be able to pay to access your hotspot service?

We have a dedicated team of sales agents on the ground and we have a number of recharge sellers who also sell vouchers for other networks. Customers will also soon be able to buy vouchers online.

 

Fiam WiFi is starting in Lagos State; can you tell us your rollout roadmap?

We plan on covering as much of Lagos state as possible over the next 18 months. We will have operations in every local government in Lagos. We get messages everyday from people who have used our services or heard about our service asking us when we are coming to their community. We will soon be as ubiquitous as pure water. In addition, we are also looking at places outside Lagos.

How much are you investing into your expansion both on the short and medium terms?

To date we have boot,-strapped to about $1 million, which has come in mostly from the founders and some friends and family. We are looking to invest about $10 million over the next few years via a mix of debt and equity.

In developed cities across the world, WiFi hotspot is the easiest way of connecting people to the internet. Why is Nigeria lagging behind?

Power is one issue, the issues of limited grid power in Nigeria is a problem for all businesses, so we power each of our hotspots using solar, inverters and batteries. Access to affordable smartphones is another factor. Recent studies have shown that in Africa, it can take someone 100 days to work to afford a smartphone whereas abroad it is likely to be a few days.

Access to finance for companies like ours is another issue. As a former investment banker, I was surprised at the number of times over the last year we have had meetings and discussions with banks and other financial institutions and they all declined to provide capital to our company to scale the business. Even though, we had invested $1 million of our own money with a clear business model, which was being executed and which was generating revenue. The common feedback was we don’t lend to startups or your revenues are not significant enough or this or that reason or they ask you to bring collateral. I think this is the challenge many entrepreneurs face trying to start disruptive business in Nigeria. It’s much easier also to find angel investors and institutions abroad, who are prepared to take a risk on a start-up in a capital-intensive business like ours. Rejection made us strive harder and we wouldn’t be where we are today if the road had been easy.

 

What do you think the government and investors should do to bridge the digital divide in Nigeria?

My view is that government can’t do everything, but it should create an enabling environment for business to operate and thrive. It’s only private finance that can bridge the digital divide. The larger telcos all mention Right of Way (RoW) as an impediment to bridging this digital divide. Lagos State is at the forefront of this with its Unified Duct Initiative; Ekiti State has reduced its RoW charges. So, things are moving in the right direction.

Did the lockdown caused by the COVID-19 affect the take-off of Fiam WiFi?

We all know what the Global Pandemic caused by COVID-19 has done to the world; we are all embracing the new normal. We commenced full commercial operations week preceding lockdown. So, you can imagine the immense challenge we faced as we had installed in many recreational places which were not allowed to open. So, we took a decision that for the period of the lockdown as part of our own palliative to the community we serve, that we would not charge to use our network during the months of lockdown.

There is one thing I would like to mention about the new normal. It is very misleading to talk of the new normal and working from home. Studies have shown that 45 per cent of people in developed countries can work from home whereas the number is in single digits in developing countries. By building our community network should we ever have to experience lockdown again it would be easier for example, for children to continue online learning as they would have a hotspot close to their home to be able to download lessons and watch them later.

Lack of electricity also makes it very difficult for people who don’t have alternative power arrangements to charge their devices. We need to move the narrative from those who have to those who don’t have.

 

A few companies are already providing this service, although, not at the scale you are taking Fiam WiFi. How prepared are you for the competition?

Lagos has a population in excess of 20 million, Nigeria about 200 million currently. Predictions state that by 2050 in less than 30 years, we will have a population of 400 million. Therefore, the market is big enough for multiple players. We serve a niche market. In fact, it’s better for the consumer that there are multiple competitors in an industry so that consumers have choice and competition fosters innovation. It’s not about what your competitor is doing, but what you as a company are doing to be successful.

 

How has been your relationship with the telecoms regulator, NCC?

I think the NCC is one of the foremost regulators in Nigeria. We have had audits by them and we have attended a few of their stakeholders’ events and consultative fora. We have a cordial working relationship.

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