Meet the man shaking up Madagascar’s telecoms market

Hassanein Hiridjee is the chief executive officer of the Axian Group, since 2011 owners of Towerco Of Madagascar (TOM). The group operates the island’s leading telco and owns and operates 55% of the island’s towers. TOM is operated at arm’s length from Telma and hosts tenancies from all of the island’s other operators: Orange, Airtel and Blueline. Hiridjee is also expanding into West Africa as one of the investors acquiring Tigo Senegal from Millicom and has ambitions for TOM as a national champion, spreading economic development across the Indian Ocean and Africa. TowerXchange discussed the background of the group, details of TOM’s operational and organisational set up, and plans for expansion. 

TowerXchange: First, please introduce yourself – tell us a bit about your history and how you got into the telecoms business?

I have run Axian for more than a decade now. Originally, we were a traditional family business that needed to reinvent itself, diversify and become more international. We started by investing primarily in the telecommunications market, and we have since made Telma the leading operator in Madagascar. Then, we invested in other markets, still in telecoms: Comoros and Reunion in particular. Today in this sector, we are present in the Indian Ocean and also in West Africa in Senegal. And we will not stop there!

TowerXchange: Many of our readers will have heard of Towerco Of Madagascar and Telma, but for those who don’t know, can you please tell us a little about the Axian Group and how its various lines of business interrelate? 

Today at Axian, we build the group around the notion of impact on economic, social and societal issues. It is our vision that we deploy throughout the African continent. We are present in telecoms, and our expertise is recognised in this sector, but we are also in finance, services, real estate, as well as being involved in energy through Jovenna. Naturally, we seek to create synergies between all activities and we actually do it! For example, the link is obvious between our operator Telma and our MVola mobile banking service, which has been very successful with more than one million customers in Madagascar. 

The common denominator of all our activities is our purpose: contributing to an inclusive and sustainable development through reliable and world class infrastructures and services such as hydroelectric production plants, telecoms towers and nano-saving services. At the same time, we invest in different funds (Partech, Amethys II) in order to contribute to the emergence of an African ecosystem of SMEs, which also allow us to strengthen our footprint across the African continent.

TowerXchange: Please introduce the Madagascar telecom market to us, with a particular focus on network infrastructure.

In Madagascar, Telma has more than 4.5 million subscribers and is the first converged operator in Madagascar. We offer our customers – individuals and businesses – quality services based on the best international standards and at the best price. In Madagascar, as everywhere, our customers want to benefit from an increasingly efficient and reliable network. We were the first to bring 4G to the island, and we invested hundreds of millions of dollars in infrastructure to deploy fibre, renovate metropolitan networks and connect Madagascar to Europe and the rest of the world with the Eastern Africa Submarine Cable System (EASSy) project.

TowerXchange: Congratulations on Telma’s status as market leaders in Madagascar, with coverage above 90%. What are your principle remaining challenges both in terms of coverage in rural areas and densification / 4G rollout in cities?

Thank you for your congratulations and your encouragement, we work hard for our customers to benefit from the best technologies and these congratulations must directly go to our great and dedicated teams. 

Our objective is obviously to reach 100% coverage, to achieve our inclusion goal. Telma currently covers nearly 1,300 cities, including more than 50 with 4G, and we have installed 10,000 km of fibre optics. We must continue to invest in infrastructure as this will allow us to remain leader on our market, build customer loyalty and win new ones. We are currently investing in a new submarine optic fibre cable project to reinforce Indian Ocean’s connection to the rest of the world. We are also reinforcing synergies between telecoms and energy with the deployment of antennas and the energy infrastructure needed to power them.

TowerXchange: What motivated the establishment of Towerco Of Madagascar as an independent towerco? What have been some of your greatest successes with TOM?

Towerco Of Madagascar is an essential asset for us because it allows us to be present in the whole chain of values of the sector. We thus master the infrastructure, the network engineering and services ensuring quality and safety for our customers. We deploy to the world’s best international standards. In addition, it seemed to me strategic that a country like Madagascar could have on its territory a national champion able to control these technologies and develop the network. Since its creation, we have built or renovated nearly 1,200 telecom towers and we are investing to build at least 100 new towers every year. We have ambition and we invest to achieve our goals.

Finally, and to return to the notion of impact that is crucial to me: TOM also acts to open up the territories. Today, when we install a new tower, it is not only about bringing the network to a geographical area, we also bring our customers the possibility to be connected to the rest of the world, to open a mobile money account and sometimes even provide them with a new source of energy.

TowerXchange: How have you devised governance strategies to ensure Towerco Of Madagascar operates in an independent manner from Telma ? What is the relationship like between Towerco Of Madagascar and Madagascar’s three other MNOs?

TOM has operated in a fully independent manner since its creation in 2011. The towerco has its own team of professional staff, its own tools, offices and governance. Services provided and tariffs are mutually agreed with each of TOM’s clients, the MNOs, in a contractual document signed by both parties, defining all terms and obligations of each party. The relation with MNOs are therefore clear, cordial and transparent. Telma remains the major customer of TOM, with a large number of hosted positions and volume of orders for build-to-suit towers and expansion of capacity at existing sites, more so than Madagascar’s other operators.

TowerXchange: What assets do TOM have on the ground? How successful have you been in leasing up the towers to third parties?

With more than 1,200 towers in the territory, TOM operate 55% of the county’s towers. This is essential for Telma as the leader, but it also provides amazing opportunity for infrastructure sharing and to allow others players to grow their presence. The competition is open and every new tenant is more competition for Telma, but competition stimulates me, encourages me to innovate and invest to maintain our leadership.

We have all operators – Orange, Airtel and Blueline – engaged in infrastructure sharing on TOM’s towers, and all of them salute the quality of service and operational efficiency we provide them. We have constant discussion with them on how to improve our businesses and the way forward to the future, and we are confident they will engage more tenancies on our sites on a win-win basis. Again, mobile penetration and technology development gives rise to opportunities  across all the country, enabling synergies and infrastructure sharing  between all actors of the industry, in order also to optimise and reduce their financial investment.

TowerXchange: When we last spoke with Gilles Kuntz he emphasised the importance of energy management and opex discipline at Towerco of Madagascar. What forms does this take today?

Operational efficiency, mainly in terms of energy management, and cost control, are still the main objectives for TOM and a key factor of our success today. We consider also the green environmental aspect of our solutions and we act responsibly to reduce carbon emission and limit all form of pollution. Energy operations are scrutinised and we closely study our processes to ensure optimum efficiency and maximum lifetime for our equipment, as well as controlling spend. We’re also cautious about using the right energy solutions as the landscape of Madagascar varies greatly, with very difficult accessibility to some of our sites. Because many sites are hard to reach, all our sites deployed in rural area are run on a pure solar solution, this represents 60% of our sites.

TowerXchange: What lessons would you share with other MNOs considering carving out a towerco?

We can feel proud of TOM’s success and the economic business model we have set up and put in place over the past years. TOM is seen today as a very efficient operation based on its model, its operational and its financial efficiency. I would therefore recommend any MNO’s or stakeholder carving out a towerco to visit us, or to engage our services!

TowerXchange: Please summarise your vision for the future of Axian Group within Madagascar and beyond.

For the next few years, my goal is simple: to have Axian make a leading impact on the entire African continent. We already operate in 34 African countries, directly through our companies or indirectly through our participation in several investment funds I mentioned early, making us the first “venture” private African investor. When we decide to grow in an activity or a country via Axian brands and services or through our participation in funds, we do so according to a common denominator: that of delivering a positive and lasting impact and contributing to better financial, energetic and digital inclusion for all people on the continent.