Karim Khoja, CEO – Roshan Telecom speaks to Teletimes

Interview by Khalid Athar

TT – Roshan, as Afghanistan’s leading telecommunications provider has a vast area of coverage in the country. Could you give out details about the exact area of its coverage and about those areas which it is still trying to reach?
KK – Today, Roshan covers over 230 major cities and towns and has a presence in all 34 provinces, covering over 60% of the population, about 20 million people. We have the widest network coverage in Afghanistan and are the first operator of choice in terms of coverage and quality. We also have coverage at all the major border roads to five neighboring countries: Iran, Pakistan, Tajikistan, Uzbekistan and Turkmenistan. We will continue to expand the reach of our network to ensure that all Afghans can access the Roshan network.

Since starting operations in Afghanistan, we built into our business model that we would go into cities or towns that were not necessarily economically viable. We call these social sites and each year we select several cities or towns in which to introduce telecommunications service. One example is Bamyan – where the Buddha statues were, which were ultimately destroyed during the war. Bamyan used to have a thriving market, hospital and tourism industry. In our first year we knew that we would lose money by providing service in Bamyan. However, today, the market is thriving again, the hospital has re-opened, a midwifery training school has opened and the tourism industry is growing. Financially, in the long-run this was a good decision, however, most importantly, providing telecommunications service has been a catalyst for building civil society.

Karim Khoja has served in senior management positions in national and multi-national telecommunications companies for over fifteen years. He has extensive experience in nurturing start-up businesses from infancy through development, and has led several GSM start-up companies into becoming major market players as President and CEO, including being the founding CEO of Mobilink (Pakistan), Director of Marketing, Strategy and Sales for ERA GSM, Chief Operating Officer and Member of the Board for CROATIAN Telecommunication HT, as well as founding CEO of T MOBILE, Croatia.
Mr. Khoja has also been on the Board of Directors and in senior positions focusing on sales, marketing and strategy for companies such as, Exi Wireless Inc, Spectronics Microsystems Ltd., and RAM Mobile Data Ltd.
Mr. Khoja’s involvement in the telecommunications sector in Afghanistan began in May 2002 as a volunteer consultant to the Aga Khan Fund for Economic Development in an initiative to install the nationwide private communications infrastructure. In January 2003, Mr. Khoja was appointed as the Chief Executive Officer for the Telecom Development Company Afghanistan Ltd., Roshan. Under his leadership, Roshan has grown to be Afghanistan’s largest mobile provider and today is the largest company in Afghanistan with over 3.8 million subscribers. Mr. Khoja is also Chairman of the Board of the Afghan Investment Climate Facility (AICF) and an advisor to the GSMA Development Fund.

TT – Would you like to tell our corporate readers about your end-to-end business solutions?
KK – Over the last year, Roshan has worked to understand its subscriber base better and how best to acquire and retain new subscribers. Last year, we segmented our main product portfolio and currently offer targeted products for youth, corporate and the mass market. For the mass market we have developed a number of special services, including Friends & Family; for the youth segment, we are constantly introducing new valued added services, including Ring Back Tones. Some of our offerings for the corporate segment include:

• Enaam, our post-paid offering, which lets customers choose from one of eight customized tariff plans with reduced calling rates to suit their communication needs.
• Saadat, our pre-paid business offering, which comes with digressive rates, after the second minute and conference calling features.
  BlackBerry, first launched by Roshan in Afghanistan in 2008, which provides access to e-mail and contacts while on the move.
• TrackCare, a vehicle monitoring service, to track a company’s people and most important assets. This system is used by Roshan today to track its vehicles.
• M-Paisa, Afghanistan’s first mobile money service, which makes it easy to send and receive funds, pay and receive a microfinance loan, buy airtime, pay bill, or pay salaries to employees. The Ministry of Interior is currently using the service to pay police officers in several districts.

TT – Please share with us the success story of Roshan Telecom from the start, from its formation to how it started receiving awards for Excellence in Leadership, Best Corporate Social Responsibility and the Most Innovative Non-Voice Service.
KK – When Roshan began operation in 2003, our strategy was very simple. We wanted to treat Afghans with respect and also provide the best quality service in the country. Over the years, we have grown our footprint nationwide and today provide Afghanistan’s widest coverage and best network quality. We have continued to introduce innovative products and services that meet the basic needs of the population like M-Paisa for mobile money transfer service.

Additionally, we have looked at how we can create jobs and promote sustainable development. Today, we are proud that:

• We have created over 30,000 jobs directly and indirectly. These are all legitimate. Roshan directly employs over 1,100 people, of which 20% are women.
• The average age of our Afghan staff is 23 and they are, at best, high school educated. Many of them were in refugee camps in Pakistan several years ago and today are breadwinners for a family of twelve.
• We spend a minimum of $1,500 per employee, including cleaners and drivers on training and development opportunities.

Through Roshan Community, we have leveraged our telecommunications infrastructure for the betterment of society. We are focused on the children, women and communities of Afghanistan to build a brighter tomorrow:
Constructing schools such as the Hakim Nasir Khusrow School in Kabul for children who are the future of Afghanistan.

• Providing women with skills in technology through the Roshan/Cisco Networking Academies to improve lives.
• Building wells throughout the country, including Ghazni, Wardak and Pakitika provinces to keep communities healthy.
• We have and will continue to benchmark ourselves against world class operators in order to provide the people of Afghanistan with superior quality service.

TT – Do you have any plans in mind for the expansion of Roshan Telecom? How do you see the future of Roshan Telecom?
KK – Since beginning operations in 2003, we have invested over $450 million in Afghanistan. In the coming years we will continue our investment in Afghanistan and its future. Mobile penetration rates are only about 30%, so there is huge potential for growth. We are also very focused at rolling out to the rural areas and expanding our network footprint to ensure access.
As part of AKFED, we have also made investments in SEACOM, the first fibre-optic submarine cable to link southern and east Africa with Europe and India, dramatically reducing connectivity prices in Africa and further extending the availability of affordable telephony and data services to the bottom of the pyramid. AKFED also holds a 40% share in T-Cell, the largest telecommunications company in Tajikistan. TeliaSonera, is also a shareholder in the T-Cell venture. We believe that telecommunications can play an important role in the development process.  We are also exploring new technologies, models and ventures to facilitate growth in the telecommunications sector in the region.

Teletimes International is a fascinating publication that provides us with unique insight as to what is happening in the region.
Karim Khoja

TT – Please talk in detail about the relationship between Roshan Telecom and TeliaSonera.
KK – Roshan is owned by an international consortium made up of the following shareholders:

• The Aga Khan Fund for Economic Development (AKFED) – 51.00%
• Monaco Telecom International (MTI), a subsidiary of Cable & Wireless – 36.75%
• TeliaSonera AB – 12.25%

TeliaSonera is the leading telecommunications company in the Nordic and Baltic region and also holds strong positions in mobile communications in Eurasia, Turkey and Russia. Fintur Holdings, a consolidated subsidiary of TeliaSonera offers communication services emerging markets through its subsidiaries in Azerbaijan, Georgia, Kazakhstan and Moldova. Fintur is also responsible for operational management of TeliaSonera’s subsidiaries in Tajikistan (also owned in part by AKFED) and Uzbekistan. This makes Roshan part of one of the largest operators in the region.

TT – What is your current market share?
KK – Roshan has about 35% market share. We are the market leader.

TT – Please tell our readers about the CSR operations and activities of the Roshan Social Programme.
KK – Our commitment to the social and economic development of Afghanistan is integral to our business mission. Our shareholders, the Aga Khan Fund for Economic Development (AKFED), Monaco Telecom International and TeliaSonera instilled social responsibility into the vision of our company. Today, it is this philosophy that continues to be an ongoing driver.

Roshan Community is the dedicated corporate social responsibility arm of Roshan. We aim to be a catalyst in the reconstruction of Afghanistan, investing in programs for children, women and communities to build human potential and capacity. From building schools, playgrounds and wells in Afghanistan, to helping women set-up their own businesses, to sponsoring soup kitchens and supporting a Telemedicine project, we change lives. We believe in leveraging our expertise in technology and partnering with organizations to enhance the work of the government and civil society to maximize impact and make a difference.

Our commitment to Afghanistan is evident in the way we operate. We have:

• Created over 30,000 legitimate jobs and supported Afghan businesses
• Provide training opportunities to our employees, most of who are under the age of 23
• Introduced mobile money services in a country where 97% of the population is unbanked
• Offer a valuable service for people to talk, not fight

TT – Roshan introduced the first-of-its-kind Telemedicine solution in Afghanistan. How was the response that you received and are you planning to introduce any more such solutions?
KK – Twenty-five years of war have left the healthcare system in ruins. To put this into perspective,

• Approximately 25% of Afghan children die before their fifth birthday.
• About 600 children under the age of five die every day in Afghanistan due to preventable diseases.
• There is one doctor for every 100,000 people in Afghanistan, compared to one for every 365 in France and one for every 500 in the United States of America.
• Most of the country’s hospitals have been destroyed.

Telemedicine seeks to support and help re-build the country’s health care infrastructure leveraging Roshan’s telecommunications infrastructure. We have partnered with the Government of Afghanistan, the Aga Khan University Hospital in Karachi (AKUH), Aga Khan Health Services, the French Medical Institute for Children (FMIC) in Kabul, Cisco Systems and the Bamyan Provincial Hospital.

The first phase of the project linked the FMIC Kabul to AKUH Karachi and the second phase extended the link to Bamyan Provincial Hospital to serve a population plagued by one of the highest levels of maternal and child mortality.

Telemedicine uses our secure network to connect hospitals across difficult and remote terrain, and broadband technology to provide real-time, high-speed access for the transfer of medical imaging, video, data and voice transmission. Through the digital transfer of CT scans and other medical imaging, this technology allows specialist and remote diagnosis of many medical conditions that can then be successfully treated in Afghanistan.
Telemedicine also provides video conferencing services for training, lecturing, and procedure and diagnostic supervision that will help to develop Afghanistan’s medical capacity. Through the link, several training courses are also delivered monthly to professionals, who otherwise would have limited, if any access to training opportunities.

Today, Telemedicine is saving lives, addressing pressing healthcare needs in Afghanistan and helping to build the nation’s healthcare infrastructure and capacity. In 2009, over 300 cases were viewed and supported using the Telemedicine link and over 300 health professionals participated in training (compared to less than 50 in 2008). Last year was also the first year MRI cases were examined through the link. Each of these numbers represents a human life touched, saved or improved, or a medical professional better able to meet the needs of patients because of training they received.

We are looking at extending Telemedicine links to other provincial hospitals in the coming years and eventually to medical institutions in Europe and North America to maximize impact. Within Afghanistan, we are also looking at connecting rural health centers with a basic portable medical kit and smart-phone. A pilot is set to commence this year. Through the smart-phone, health practitioners can actually send electronically information back to a provincial hospital and onwards to Kabul. This will provide doctors and community nurses with access to skilled practitioners. 

TT – What level of competition are you currently facing? What is your anticipation regarding this competition for the coming years?
KK – The telecom industry in Afghanistan is hyper-competitive. There are now four large GSM operators, Roshan, Afghan Wireless, Etisalat and MTN, and a Government owned fixed line/CDMA operator, Afghan Telecom. Two of these operators are the largest regional operators and only entered the market after Roshan proved that there is a successful model to operate in the country. There are already over 10 million mobile phone subscribers in the country, with a total population of 32 million. Mobile penetration rates are about 30%.

Given the fact that the Afghan market is really only seven years old, this level of competition is significant. When Roshan began operations in 2003, only less than 100,000 people had access to a mobile phone. The GDP is relatively low and costs are high due to the lack of infrastructure (electricity, roads, air and transport) and the challenging security environment.

Even with the increased level of competition, Roshan is the largest operator in the country with over 3.8 million subscribers, covering 60% of the population. Roshan has the most extensive coverage nationwide and a significant rural reach.

We believe that competition increases customer choice and also enlarges the overall size and viability of the telecommunications sector in Afghanistan. Our strategy is to maintain a high-quality network and to continue to bring unique products and service to market that meet the basic and unique needs of the Afghan population, while contributing to the development of Afghanistan.

TT – How would you rate the progress which the Afghan Telecommunications industry has made over the past years, also in comparison with its neighboring countries?
KK – Afghanistan is the fastest growing market in the world in terms of penetration rates. Less than 100,000 people had access to a phone in 2003; today over 10 million people in Afghanistan use a mobile phone to communicate with their loved ones. Roshan has been at the forefront of product innovation, bringing new technology and services to Afghanistan like BlackBerry. Roshan was also the first operator to bring M-Paisa, a mobile money transfer product to the region.

This year, we also saw the formation of the Afghanistan Telecommunication Operators Association, also known as ATOSA. This has been very important for the industry, bringing together the various operators to collaborate closely with the Government of Afghanistan to ensure success of the telecom sector.