Chief Ezekiel Fatoye, an engineer, has remained a strong force in the tele-communication industry in Nigeria for four decades. Even as a septuagenarian, he is still very active in and outside the boardroom.
An ex-Executive Director at NITEL and Multi Links, Chief Fatoye is at present on the management team at Spectranet.
He here speaks on the secrets of his healthy life as a septuagenarian, even though he does not get himself engaged in strenuous exercise. He also exposes the lifestyles of many of his contemporaries and the practices that kill corporate organisations.
One notices that at 78, you are still looking healthy and fit. What is the secret?
Well, I am not 100 per cent fit like I used to be. About four or five years ago, I had a stroke. But I thank God it was mild and I eventually overcame it. I am thanking to God for His mercy. It is God’s decision that I should be around till this moment. I thank Him for His unlimited mercy in my life.
Why did you say so?
Well, when one is 70 years of age, that is the time for one to be rounding off on life. Like my uncle, Chief Morakinyo used to say, ‘If you are 70, you have got your boarding pass and you are in the departure hall. If the flight is early, you are gone; if it is delayed, good for you. The flight could be delayed for 24 hours or longer if you are lucky (laughs). I think that is the truth. Look at the case of Stephen Keshi, a young man, very sportive, very energetic, but he just died like that!
Some 10 years ago, you were sharing your hobbies in an interview, and you said that as a form of exercise, you could not imagine yourself jogging around the VGC after eating your favourite meal of pounded yam…
(Laughs) Yes, that is what I am saying. They will tell you ‘oh, it is all about fitness. You are supposed to go swimming, run, jump and do all sorts to keep fit. Now, that was all part of Stephen Keshi’s job! He was running around the field, training footballers, but he just collapsed and died at 54. So, for me to be here sitting and talking with you, it is God, and I return all the glory to Him alone.
So in what ways do you recreate these days?
I go to church. I do the necessary things that I feel I have the ability to do. I laugh, work and leave the rest. In doing all that, I am already well exercised.
You are known to have been part of innovations in the telecommunications industry. After your tenure as executive director in NITEL, you started Nigeria’s first private telecommunications firm, Multi-Links, and at the advent of GSM, you moved out of that market before the collapse of CDMA. What is your survival secret in telecommunication business?
Well, I think when we were in NITEL, we could see what was happening. I mean with our exposure then, we knew that telecommunication was going to be privatised at some point. The government was struggling to diversify the telecommunications business because telecom was strictly a monopoly then for the government. But we saw the revolution coming and we asked ourselves, ‘what are we going to do?’ So, we positioned ourselves to be able to compete if eventually government brought in private people to invest in the sector. We knew much about the industry.
In fact, we took part in the formation of the NCC. The initial money provided to run the NCC was raised by NITEL at that time, and most of our people also worked with NCC as board members. So, we knew that privatisation was coming at that time and we wanted to do something quickly before government came. Unfortunately, we were handicapped because of bureaucracy and procedures, limitations of budget approval, and that unfortunately created problem for NITEL. That was why NITEL could not function as much as people expected it to.
A time came when government decided that NITEL would be sold. We felt that it was not good, just because it was going to be sold, to start running the place down, saying oh, NITEL is not good or NITEL is useless; trying to de-market NITEL. But that is what was done. If you have a car and you keep saying oh, this car is not good, people should come and buy it. Who will buy it? The person can throw any amount to you to claim the car! That was exactly what happened to NITEL. NITEL had a lot of investment potential. It had a lot of potential as a company, but the odds against it were just too much.
Of course, NITEL can still do well. I learnt some people have finally bought it. If they run it well, they can even be bigger than any of the existing telecommunication organisations. I think they are now called M-TEL.
Another issue that is pertinent to the sad NITEL episode was the fact that a lot of people were not paid their benefits and a huge number of people actually died. How did you handle that episode?
See, that is a very serious area you have just mentioned. You see, when we left NITEL, we got our gratuity the same day and we entered into pension the following month. So, NITEL was well organised. We had already planned our retirement strategy. We saved enough money for NITEL so that if they invested the money, whatever accrued from the investment would be enough to pay pension. That was the plan we left behind in 1994. Unfortunately, the money was just squandered.
We had money in foreign exchange. We also had in naira value, and we said okay, let us invest this and we can use whatever accrued on the investment to pay NITEL, and we had already worked it out. But when the next government came, they started spending the money. When PDP too came in 1999, they finished the money. They just got the money and wired it. They said ‘ok, pay them (pensioners) for three years, pay them more for three years, pay them five years and they paid us en bloc. Now, it is over five years ago that they have paid that money. When you sign to work for government and you sign for pension, it means that they are going to pay your pension for life. But in this case, the government decided they were going to pay them off.
But why was this so?
I am also surprised. In fact, many of my colleagues are dying now like chickens. Every day, they say this or that one has died. Why? Because they don’t have anything again. There is no money; nothing. They were relying on continuous pension. Five years ago, they finished all the money they paid. In fact, it got to a level the pensioners took government to court and won the case.
So, what happened to that case?
Of course, the Federal Government put up an appeal. They were at the verge of going to the Supreme Court and government urged them to withdraw the case for a round-table discussion. Now, there is even no penny to pay anybody. People who are working can’t earn enough money to live, so what will happen to the pensioners? So, daily, people are dying like chickens. In fact, I know the senior ones in NITEL who worked in Britain before, they have gone back to Britain to be collecting pension. They have their houses and they live comfortably well in Britain now. Imagine, after working for thirty-something years in their own country, they couldn’t live well. They worked for five or 10 years in Britain and they are living comfortably well. In fact, some of them are getting five hundred or three hundred pounds in a month. If you get that in a month, won’t you be able to survive? And if they come here with that money in their bank account, after converting it, they have something reasonable for them to survive.
You were able to survive all that uncertainty by getting investors to establish Multi-Links. That business survived until the arrival of GSM in 2001 and you sold again to move up to data technology sector. How were you always able to see and move ahead?
You see, one thing about life is that you have to think ahead of time. A telecommunication company requires big investment. You need a lot of money. It is not a little game. It is a game of cash; deep pocket. If you don’t have that, you cannot survive in telecommunications. And you have to look at the technology that is coming. You must review the type of technology that is coming. We saw it coming. We looked at the business and we decided to be truthful to ourselves. As we have in the political arena, so we have in the field of technology.
CDMA was supposed to be superior in design to GSM. In fact, it was Quocom of America that developed CDMA. They made a good use of the technology and sold it to another company to develop it. Before that technology, CDMA was strictly used for the military. They used it for the military because of the nature of the security involved. They didn’t want anyone to clone it. It is so difficult to clone, and that was good for military intelligence, especially during the era of the cold war. So, when cold war was over in 1962, they decided to commercialise the technology and that was when they allowed it to be franchised, and that was how CDMA became a globally used telephony technology in some parts of the world.
Of course, they could have come up with more value added innovation to it as the promoters of GSM did, but you know Quocom is a very small company. Erricson was the forehead of GSM. They were the people who really spent a lot of money to develop GSM. So, when Quocom was going through recession, they bought over Quocom. When they bought over Quocom, there was no way Quocom could go forward with her CDMA invention. Of course, they have spent a fortune on CDMA, and when Erricson took over, the CDMA went down and GSM began to thrive. So, we knew that GSM was going to wipe the market because of the value added. We were aware of the data technology, the SMS and all other facilities that came with it. So, it was obvious that CDMA had no chance to survive in that market anymore.
If it was just voice market, yes, CDMA would have been okay. But now the system is beyond voice. It is now data that is the major business. So, that is what we saw and we said, gentlemen, I think we have to move; that in another few years to come, things would change. So, you find that eventually, we now sought data and we started data in a very unique way, and I think data is the new way to go. Eventually, penetration is coming high in Nigeria and eventually, it is going to be the in-thing.
As it were now, it seems MULTI-Links has sunk in shape and visibility. Is it right to say that TELCOM of South Africa made a mistake by buying MULTI-Links off you considering what happened to them a few years afterwards?
That is a story for another day. But if you insist, I will tell you yes, they ran away.
Why do you think they had to run away?
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| Chief Ezekiel Fatoye with friends General Alani Akinrinade (left) and Chief Alex Duduyemi (right) |
And they had one weakness, which also culminated in their failure, and I warned them before I left there. I think they have this racial arrogance. They had three races running the administration of Multi Links at the time they took over. They had Nigerians separate, Indians separate and South Africans separate. But South Africans were on top, every other person was down. That was what they were doing, and I warned the man there. I even put it in writing. I said, ‘Look, I warn you not to behave like this; the thing will not augur well for you if you continue like this.’
You think the Indians should have taken vantage positions because of their technological know-how?
No, they could have used anybody, but don’t discriminate. Don’t show it up. You know this apartheid background they are coming from really affected their psyche and that really destroyed morale. Some of them are white, and that really led to a big problem. Come to think of it again, there were other things they did that did not augur well for the development of the company. In some cases, they went to hire sites in areas they never had network. They went to Adamawa, Yobe and all those far-flung areas to hire sites where they didn’t have signals and they didn’t even plan to have anything there. And they were paying.
Not only that, they now set up another company, which they said would be responsible for the operation of the service. Then they were going to pay 18 per cent of their gross income to that company, and that company had no staff. Multi-Links staff would be doing their jobs and they would still pay the company 18 per cent. Then the real company, which is Multi-Links, they had nothing for them. When the revenue was going down, they then signed an obnoxious agreement with that company. They signed 10 years. When they eventually found that they were in trouble, they decided to run away. The people they borrowed the sites from, they were already owing them over a $100 million. The houses they paid three years rent for in one place, they couldn’t stay there and ultimately, the landlord could not return the three years money to them.
So, when you consider all this, you will see a multitude of actions that led to failure. That is why I told you it was corporate governance issue that ruined them. When they now ran into total confusion, they called Helliot, the people they were owing money, to come and buy the company over, and the people said, ‘well, we are not operators, we only provide services.’ They said, ‘okay, bring $10 million and we will give you the company.’ That was what they did to Helliot. They transferred the whole thing to them and said ‘okay, liquidate all what we are owing you, take the company over.’
So Helliot took over?
Helliot was like, how would they cope? How would they get the company on? That was how they brought Demola Elesho to go and look at the way to bring the company on. But because they could not expand anymore and the others were expanding and they were losing customers every day, subscribers were dumping their network, they went lean. They are still operating now.
So, what is the story of Spectranet where you are now?
Like I told you earlier, we have seen that the future is data. What we wanted to do was more than just data. We wanted to create a complete bundle where you have voice, television and data together. Like in Britain, if you say you want to buy Sky today, you have a telephone line, you have television and you have the data or wifi or whatever you want to have in your house. That is a complete bundle. That is what we wanted to do. But first of all, government did not appreciate our effort. We said okay, we want to run fibre to every home in Lagos and Abuja, so that every home will be able to have television, telephone and data. That was our major plan: land line, television and data. Even at the initial stage, we were discussing with Sky in London to see how we could partner with them in the area of buying content from them.
And how is Spectranet doing in terms of market share?
I think we have a good lead. We are okay in Lagos and Port Harcourt, Abuja and even in Ibadan. We are okay now. But the only problem that data people have is the cost of the bandwidth, although it is coming down now. The cost of the bandwidth, that is the one that carries signals from Main-One or Glo or SAT-3 or whatever to enable our international cyber link. And why it is costly is because people who invest in bandwidth want quick returns on investment. Yes, they have the capacity but they are now reducing the capacity because of the cost. The cost is too high. If the cost has been reasonable, maybe the cost of running data would have come down completely, because it takes a bigger chunk of the production cost. That is the bandwidth cost. So, if that comes down like in many countries, we could enjoy cheaper data consumption.
In some countries, the equivalent is N9 per metre. But in Nigeria, they are asking for N12,000. So, this is the real challenge we are facing. But I can equally tell you that they are coming down. In fairness to them, they are coming down because of the competition between Glo, MTN and May-ONE. Those are the three companies that are offering data services. Of course NITEL also has, but I don’t know if they still function.
We learnt NITEL is coming with a 4GE data speed and they promise to make that a niche game. Do you see that succeeding?
Well, that is what they said; they want to start from the top. You see, people are running away from landline. And that was what NITEL was doing before. Anybody that has ‘national carrier’ is obliged to provide landline. Glo and M-Tel are supposed to provide landline because they are national carriers. Glo is second national carrier, while M-Tel is first national carrier. They are supposed to provide Nigerians with land phones. For instance, if I want a land telephone in my house now, who do I apply to? I guess nobody.
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