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Logo of Phnom Penh Post newspaper Phnom Penh Post - More consolidation desired

More consolidation desired

Lan Watson

The CEO of Cellcard says he would like to see further consolidation take place in Cambodia’s mobile telecoms market.

“The size of the population cannot support nine mobile operators,” said Cellcard CEO Ian Watson in an interview last week.

“If you look to similar populations in more advanced economies, they only support three to four operators. Further consolidation in the market has got to take place,” Watson said in an interview last week.

Watson, 49, who comes from Northern England near Manchester, has spent the last 20 years working in telecoms, including eight years at Bright Point, an Indianapolis-based American telecommunications company, as well as the Middle East, Africa and the Caribbean.

Watson also previously served as the CEO of Wing here in Cambodia after he and his team had set up Refresh Mobile, which ended up being part of the company that acquired Wing.

“When I was working in the Caribbean we got an enquiry from one of the telecom companies about a pre-payment system, and we set up a company called Refresh Mobile that was then sold to a private equity company,” Watson said.

After running Wing for eight months, Watson was approached by the Royal Group to run Cellcard and has been serving as CEO for the last nine months.

“Cellcard is the only mobile company in Cambodia I would have joined because of the dynamics, and the way the company is positioned,” he said.

Watson acknowledged that Cellcard was servicing the debt on a loan from the Bank of China that he says was part of a deal to facilitate the purchase of Millicom shares in Mobitel.

“We continue to service the loan in line with the Bank of China’s requirements, and we have substantially reduced the outstanding, and this is the norm as part of an equity buyout in the telco industry,” Watson said.

Answering a question about Hello owner Axiata’s offer to purchase Cellcard last year, Watson said it was an unrealistic.

“The offer received from Axiata was an unrealistic offer. Even though I wasn’t working here at Cellcard yet, I know that it grossly undervalued the company,” he said.

While Metfone has continued in the number one position with upward of seven million subscribers, the merger between Smart Mobile and Hello has put the new larger Smart in the number two position with about five million subscribers, and according to Watson, Cellcard has nearly four million active subscribers.

“We have 3.98 million active customers,” Watson said. “From my perspective, taking into account the way other companies measure their active customers, Cellcard remains the largest mobile company in Cambodia. We think we have got one of the widest and deepest networks in Cambodia, and we cover all 24 provinces and all major populations. We have also got one of the most advanced solar solutions as backup for our cell sites,” he said, adding that Cellcard employs about 700 people.

Watson said Cellcard’s data traffic grows at a minimum of 9 percent month-on-month.

“We run one of the widest 3G networks in Cambodia and we continue to heavily invest in infrastructure to support the growth in data in Cambodia.As the market matures the prevalence of data becomes greater as in line with other markets.”

Watson says over time, voice will become free and people will be charged only for data. He said about 30 per cent of Cellcard customers carry smart phones.

Speaking about the departure of senior Cellcard officials starting last year, including CEO David Spriggs, COO Kay Lott and CFO Kim Fikry, Watson said people come and go in the telecoms industry.

“As a company grows and moves, people come and go. We’ve replaced the senior management with people who have got the relevant experience for the market.”

Watson said Spriggs had moved to the Royal Group, Fikry had gone to England and Lot was pursuing other career interests.

“They all remain close friends of the Cellcard family; I talk to them and they give us feedback,” Watson said.“We continue to attract the best talent. In respect of future growth, I am confident that Cellcard with its business plan will continue to be the only Cambodian-owned operator in the market.”

Watson said Royal Group Chairman Kith Meng “is the best boss I’ve ever worked for. He lets the executives of the company run it the way they see fit.”

Watson said Cellcard would continue to be the leading mobile operator in Cambodia.

“We will continue to invest heavily in products, infrastructure and people. We plan that we will start trials on 4G service in the last quarter of this year. The 4G services will provide exciting services at very competitive pricing,” he said.

“Cellcard strategy will be to continue the lead the Cambodian mobile market by delivering relevant services from the best network at the best value.”



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