Nepali Times
"The customer is boss"

Sugat R Kansakar is the first Managing Director of the NTC's new avatar: Nepal Telecom. Having worked for almost three decades with the organisation, he knows the days of state monopoly are over. Kansakar talks to Nepali Times about competition, demand and supply, and how the company will remake itself.

Nepali Times: Is this move going to change anything as far as Nepali consumers are concerned?
Sugat R Kansakar: We need more business sense and professionalism than in the past when we had a monopoly. Since we will now have to compete with professional and private organisations, we definitely need to envision how to capture the market and expand.

And how are you going to do that?
We shifted from Corporate Act to Company Act, the latter will guide us now. This means all financial rules and regulations within our organisation will change. Political interference will be lessened and we will have more autonomy. The biggest benefit from this change is that we can float shares. The board will decide modality and details within a few months.

But will Nepal Telecom continue as a government entity?
Yes, unless we offer bulk shares to the general public or a private investor. Right now the government owns 100 percent. We will sell shares to the public and, if the government decides, we may sell bulk shares too. That's going to be a big decision since we are among the biggest earners with almost Rs 7 billion annual gross revenue. We will float a minimum of 10 percent of shares to the general public, which means the company will still belong to the government.

How can you be sure, then, that the government will suddenly stop interfering?
There is no guarantee. But since we will be guided by the Company Act, we have to prepare our financial rules and HRD regulations accordingly. The ownership, however, remains with the government and we will have to be guided by the owner.

Does this prepare you to face the challenge from private competition?
Till yesterday, we saw ourselves as government servants who had the upper hand while dealing with clients. From tomorrow, we have to say the customer is the boss. This paradigm shift is very challenging and we've already begun training our staff. Nepal Telecommunication Authority can make any decision regarding private investors. We have no say in their decisions and must prepare for tough competition.

What new services can we expect?
We'll introduce scratch cards, which is a pre-paid card that allows the user to call anywhere in the world. This is aimed at the tourist market. At present we have around 400,000 land telephone lines and around 130,000 mobile subscribers. We also have internet services, but this sector is primarily dominated by private ISPs. We have installed VSAT telephones at almost 130 remote areas and operate VHF services at around 200 sites. We also provide lease lines to banks, ISPs and the press.

What our readers want to know is will their mobile calls get through?
There is some circuit congestion but we're doing our homework. We are going to install more capacity, and within a couple of months, the situation will improve. We're already doing better than six months ago. Congestion began because we sanctioned too many mobile lines because of a high demand.

So it was bad planning and not bad equipment.
We had a little bit of a problem initially because the supplier was from Israel and the system from Canada. That's been cleared up now. The last tender was from China, which quoted only $12 million. Some people suspected that the supplier might give us second-hand equipment. But it was a global contract and they won. The company itself is one of the two biggest suppliers in China.

We began our investigation on the congestion problem and found this kind of situation arose almost everywhere. In Thailand, there were 10 upgrades before the system was perfected. So far, we've have had only two.

Till the mid-80s, Nepal had the best telecom services in the region. What happened?
China and India escalated in all sectors during the last five years. We could not move as fast. We've have had lot of politics and less development. But we are ahead of Bangladesh, their telephone density is less than ours. I am confident that we will be able to provide telephone lines on a demand basis within three years because we are going to introduce CDMA (Code Division Multiplexing Access) system. This latest American technology was brought by the Reliance Group of India. Till now we had a huge gap between demand and supply, there are 300,000 applicants waiting for telephone lines.

(11 JAN 2013 - 17 JAN 2013)