Pradeep Lal, CEO of Vodafone Papua New Guinea, speaks to Business Advantage PNG about the challenges of establishing a robust nationwide network, and the massive opportunity ahead, as surging data use in the country encourages more customers to switch to smartphones.

A subsidiary of Fiji’s Amalgamated Telecom Holdings, Vodafone PNG was launched in April 2022. Credit: Vodafone PNG

Business Advantage PNG: Vodafone PNG has now been in Papua New Guinea for almost two years. How is your network build progressing?

Vodafone PNG’s Pradeep Lal.

Pradeep Lal: We had encountered some delays in the initial phase due to COVID outbreak, but in our second year, I am pleased to announce that we’re on track to establish 770 towers across 22 provinces.

Our aim is to create a resilient network spanning the entire country. In addition to our existing Port Moresby data centre, we’ve have expanded with live data centres in Lae, Mt Hagen and Kokopo.

Business Advantage PNG: So you’re covering the country now?

Pradeep Lal: Certainly most of it and there are also talks about co-location that will cover the un-connected. Under the terms of our non-disclosure agreement, I’m unable to divulge extensive details. However, I can share that, in Western Province alone, we’ve finalised agreements for 81 towers, contributing to a total of 851 sites expected to be operational by the first half of the year.

Concurrently, negotiations with Digicel and Telikom PNG are ongoing. Originally centered on co-locating on their towers, these discussions now encompass the prospect of jointly identifying locations for new towers to ensure comprehensive national coverage.

Business Advantage PNG: So, it’s also in the national interest?

Pradeep Lal: Absolutely. The telecommunications sector is poised to significantly revolutionise numerous other sectors within the economy as connectivity becomes imperative in an increasingly digital economy.

“Currently, prices in PNG are positioned towards the higher end, indicating potential for more competitive price offering.”

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Businesses, in particular, are benefiting greatly from this transformation as they now have a variety of options available to them. Many businesses are prepared to pay market prices, provided they receive a high standard of service in return.

The emphasis on “quality” is paramount, especially considering the far-reaching implications because of increased reliance on technology. For instance, if a bank experiences downtime with its ATMs and branches for even a single day, it can disrupt the entire supply chain and potentially have repercussions on the broader economy.

Business Advantage PNG: How has the entrance of Vodafone impacted pricing of data and services?

Pradeep Lal: None of us are inclined towards engaging in a pricing war. Instead, we anticipate a gradual decrease in prices, driven by the efficiency gains through economies of scale inherent in business growth and expanding customer bases.

“Given that nearly 50% of network capacity in PNG is utilised for data usage, owning a smartphone is essential.”

Currently, prices in PNG are positioned towards the higher end, indicating potential for more competitive price offering. Additionally, the cost structure in PNG is comparatively elevated, resulting in higher prices compared to other regions in the Pacific.

Business Advantage PNG: How are you using satellites in your network, and do you see satellite providers as competitors?

Pradeep Lal: We harbour no issues with our satellite vendors; rather, we view our relationship as complementary, offering customers a broader array of choices.

Given the challenging terrain in PNG, we currently rely on three satellite vendors within the country, resulting in a mutually beneficial setup. This approach allows us to extend connectivity to numerous rural communities that previously would have necessitated the installation of multiple towers.

Satellites currently offer a certain amount of bandwidth and data, the evolving needs of customers now demand terabytes of data rather than gigabytes. While satellites can complement operations, meeting current demands poses a challenge, as they are not sufficient for most customers on their own.

Business Advantage PNG: In terms of competition and portability, how easy is it for somebody to switch from Digicel to your service, or vice versa?

Pradeep Lal: NICTA is the regulatory body for the ICT and telecommunication industry and is tasked with ensuring fair competition in PNG. It is currently addressing crucial matters like number portability and interconnect rates. Recognising the importance of providing people with freedom of choice, number portability is already available in about 90% of global telecom markets. So, I think NICTA is committed to addressing these issues in the best interests of everyone.

Business Advantage PNG: How can you encourage people to switch from simple devices to newer smartphones to help accelerate digitisation?

Pradeep Lal: While Vodafone’s network has been 4G+ enabled from the beginning, we are now working on raising awareness among Papua New Guineans to upgrade to smartphones that offer an enhanced experience, allowing them to connect with the world at their fingertips.

Given that nearly 50% of network capacity in PNG is utilised for data usage, owning a smartphone is essential. In our recent campaigns, we introduced highly affordable versions of popular smartphones such as Samsung, TCL, and Apple (iPhone). Devices need to be priced well and customers should have a choice.

Additionally, we’ve observed that customers often begin with a basic smartphone and, upon realising the benefits and good experiences, they naturally opt for upgrades. In the upcoming year, I am confident that smartphone penetration in PNG will surge to an impressive 70 to 80 per cent.