Vodafone Qatar CEO: Towards profitability

Vodafone Qatar is enabling the growth in the telecoms sector in the country
4G, 5G, Challenges, Deal, GCC, Gulf, ICT, Operators, OTT, Qatar, QNBN, Smart City, Telecoms, Vodafone, Vodafone Qatar

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Kyle Whitehill is clearly a man who lives and breathes telecoms. “What I love about my job is that every single day I can see how the telecoms industry is changing the way that we work,” the Vodafone Qatar chief told CommsMEA during a visit to Dubai last month.

Whitehill, who joined Vodafone Qatar as CEO in July 2013, has certainly seen his share of change in the telecoms industry, both in Qatar and further afield. Having previously been CEO of Vodafone Ghana and COO of Vodafone India, he also has a taste for adventure and experience of diverse markets. This is something that has proved useful in his latest role, with Qatar experiencing rapid growth and development, much of which is being driven by a surging population of foreign workers.

Vodafone Qatar, which launched mobile services in July 2009 as Qatar’s second operator, has faced a tough uphill battle competing with the might of incumbent operator Oooedoo, but with net profitability now within site, Whitehill is in ebullient spirits.

Vodafone Qatar CFO, Steve Walters, said at the end of last year that the company expected to turn profitable in 2015. While Whitehill confirms that the company is now making money, he expects the first net profit to be made early next year. “We are still a year or so away from becoming truly profitable from that respect [net profit], but that is very much a paper transaction. The business is making money and we will continue offering our shareholders dividends,” Whitehill says.

“What you are going to see at the next financial results is that we continue our growth path, we had another year of more than double digit growth. We are now in a country where, clearly, the population grows and the economy is growing so we are seeing the benefit of that. We have been very efficient on costs, so we have seen some improvements on our profitability. The one which is more in focus for us is our net profit,” he adds.

According to the Minister of Information and Communications Technology H.E. Dr. Hessa Al Jaber, Qatar’s telecom sector is expected to grow by nine to 12% by 2019 and Whitehill believes that three factors will help to achieve this forecast.

“Population growth is helping to develop this [growth]. In the next three to four years you are going to see almost one million of people come to Qatar, because I think that the World Cup and preparations for it will bring more people,” he says.

The second reason is the huge amount of residential development that Qatar is witnessing, all of which will require telecoms infrastructure and services. “We see Dubai as a business hub, but I also see this happening to Doha, as more enterprises are coming to Doha and they really need to have access to connectivity,” he explains.

This last segment, the enterprises vertical, has been a strong focus for Vodafone Qatar. “When I first came to Qatar two years ago, one of our key things was to make sure that the competition was better within the enterprise vertical.”

The company divides this sector in international companies, domestic or local businesses, and SMEs. “We have been acquiring some revenues from the SME sector. If we look at the last couple of years, we have almost doubled the size of our enterprise business year on year, and I am hoping in the next two years to see the same growth path for SMEs.”

Whitehill adds that Machine to Machine (M2M) communications will be an important growth area in the telecoms sector. “We have discussions with most of the major developments in Doha, around smart parking, smart metering, and smart education. M2M is a major vertical for Vodafone globally, and we have the capability. I think that smart insurance by better driving, will be a focus for Vodafone.”

Furthermore, Whitehill wants to have more fixed access. In October 2014, Vodafone Qatar reached a non-binding agreement to buy Qatar National Broadband Network (QNBN). However, the company scrapped its previous announcement bid to buy state-owned wholesale fibre broadband network provider QNBN in December. “The relationship with QNBN will help us to target more specific areas. We want to have more network coverage so that we can offer residential broadband and we can talk with customers about international connectivity, for example,” he said.

When asked about the QNBN deal, he said that the company hasn’t stopped and continues to try and progress with the deal. “First of all, we compete with someone very large and it was a dominant player of the fixed line services here and so we fail very strongly [when finding an agreement]. We have sales and marketing and operations, customers’ management and QNBN has good capabilities around deploying fibre. This is a 100% a government owned company so clearly transactions are going to be a little bit more complicated than normal. At the end we went to seek approvals from each stakeholders and then we discover that the government wasn’t as committed towards the deal as we thought so we had to put it in pause and we are working again to reenergise these discussions.”

Whitehill believes that signing this deal is the right thing to do because the country needs good providers and to avoid monopoly broadband. “I am hoping in the very short term to see that we discuss again this deal. I am very hopeful that within the next six to nine months we will able to do something again and this will require willing from my stakeholders and the government to support it,” he adds.

The company has also become fully Sharia’h compliant and its shares jumped 18.99% on month-on-month in February 2015, after it announced it had switched its financial activity to Islamic transactions since early February. “This was one of the most surprising things that happened in the last two years to the company, we were very determined because the board was very firm to become sharia compliant and a year ago we embark on that journey,” Whitehill said.

“We were very fortunate with our chairman and we had the support of a professor of the Qatar University and we work with him and his advisors for about 6 months. We had to look at our loans, our debts, our suppliers, everything financially to do with the business and work on it to make sure that it was compliant. It was in January when we finally got that,” he explained.

Whitehill believes that Islamic investors were very positive about the sharia compliance and the company. The company has hired someone who sits down at the company and checks and assures that Vodafone Qatar is meeting all the requirements to keep on being sharia complain. “We see different advantages, first of all the company point of view, the staff are very confident that we are actually compliant, secondly the shareholders and clearly from a customer point of view we have a lot more interest that we never had before because we are now sharia compliance,” he added.

Career path

Kyle Whitehill joined Vodafone UK in 2001 as head of the Enterprise business. In February 2008 he moved to Vodafone India as chief operating officer. During his tenure, the subscriber base of Vodafone India’s business grew from 47 million to over 100 million.

His early career was spent in fast moving consumer goods with L’Oreal and Jeyes before he entered general management with the Soft Drinks division of PepsiCo.

In 2000, Vodafone approached him to become part of its team, while he was working at PepsiCo in Budapest.

“I was confused because I didn’t really know too much about telcos back in 2000. I sat down with a man who had been in Pepsi for several years and he told me: ‘If you were my son I will tell you to work with telcos. At the end of the day a soft drink is water, sugar and some concentrate, but telecoms will change the way the world works. And I thought: ‘That is interesting’. I had no idea what he meant but it just sounded good. It sounded like the telecoms revolution. So I made a good decision to join.”

Whitehill was educated in Scotland and has a degree in marketing and economics.

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