Go Mobile chief executive officer Juanito Camilleri looks back on the company's second anniversary and outlines to Malcolm J. Naudi how the company is progressively straddling the poles between mobile communication services at large and other media - the Internet in particular - but also private Intranet for corporate use
All the numbers have added up for Maltacom plc mobile subsidiary Go Mobile. Speaking to The Sunday Times just minutes before announcing the Go Mobile subscriber base had exceeded 100,000, CEO Juanito Camilleri announced that 2002 would be "a marginally profitable year".
Two years down the road, Go Mobile's investment in network, billing and switching infrastructure, which includes also GPRS, has "exceeded $50 million".
Dr Camilleri said that, considering the investment, not just in technology infrastructure but in the network of shops and building its head office, "this is a remarkable achievement because in these types of investment, many a time, you don't see the results we've obtained this year before the third year and mostly the fourth year".
Apart from celebrating its second anniversary, he added, Go Mobile was also marking "a very important milestone: I would call it the milestone of stability for Go Mobile". Many people took it for granted that these results were available for the picking.
"I can assure you that achieving these results was not easy. One of Go Mobile's main achievements was to break the mindset that the mobile phone is for the elite, something that only a few people can aspire to. We have gone from something capricious to a need.
"We have come to see mobile communications in our society as useful, important and (something) people's lives would be different without. If you had to ask the man in the street even two years ago (about this) even this extent of penetration was not envisaged. This is a great satisfaction to us."
Mobile phone users have shot up from 27 per cent of the population to over 60 per cent, while prices have tumbled by 60 per cent. Dr Camilleri is very precise on Go Mobile's definition of an "active subscriber": people who make calls or send SMSes in the past month.
"It is pointless saying three months ago this person gave me money, if this month they've given me none. So, I want to have as conservative and as sober a definition as possible. That's what we've always done because it is pointless building castles in the air, so that then the balloon bursts."
How many people are actively using their telephony is "difficult to say", he went on. "We know of a phenomenon where there are individuals with more than one line; people have bought a second line and are churning to another operator but still retain the first operator's line simply to divert calls or to give a warning that they have migrated to another operator. There is a bit of an overlap..."
Giving a snapshot of the company, Dr Camilleri said: "Our psyche has moved from being simply a switching, billing and radio infrastructure to becoming a company which is focused more and more on trying to straddle the poles between mobile communication services at large, with other media - the Internet in particular - and private Intranet for corporate use.
"Our subscriber base has become extremely diverse. At one stage we had late adopters coming with us. Today, out of the portfolio of 100,000 users, we have a good cross-section of business people, people who use the phone regularly for personal use (and) casual users who see the mobile phone simply as a means to keep their minds at rest that they can be in touch or for people to contact them should something happen."
Go Mobile employs over 170 with an average age of 28 (25, if you exclude senior management). "We have managed to keep a very focused workforce (and) we will need to recruit a bit more in reaction to the growth in our subscriber base, but our main recruitment will be in the areas of replacement. People leave to go to University (or) to pick up new jobs."
Apart from its headquarters in Marsa, Go Mobile operates six other outlets: one in Gozo, one at Malta International Airport, and in Valletta, Msida, Sliema and Fgura. It also has an extensive network of resellers, its "indirect channel".
The orientation of the company is also changing, with the head office and outlets taking on more of the role of "distributed customer care. We are doing a certain element of restructuring because now we want to put much greater emphasis on retaining the customers we have. Obviously, we want to attract more customers, but the last thing we want to do is lose customers from our network."
Even at head office, when Go Mobile was launched, there was a large shop area, which has now been taken over by its customer care centre. The shop is now in the smaller area "because we have more subscribers who need first hand interaction".
Customer feedback, he said, was "very positive", although he conceded: "It doesn't mean that there aren't individual issues that need to be solved and that is why we have a 24-hour call centre. But you have to remember that this is extremely fragile technology. When you put it all together, it is incredible that one can offer such a robust, pervasive service, given the type of technology it is - hit-and-miss radio technology."
This may also be taken for granted, with Dr Camilleri pointing out: "It is amazing that radio and switching technology have been refined to the extent where such networks can be supported. However, there are issues from time to time of service, us perhaps not projecting the right message and people misunderstand what we are quoting.
"However, with all the infrastructure we have installed for customer care, generally, I would say that the vast majority - in excess of 98 per cent - of our subscriber base are very happy with our service. So, it is a very good certificate.
"Again, I am not saying that we can rest on our laurels and there aren't instances when we let individuals down. But the moment we actually realise that, we try and react immediately. The level of customer care that has entered in the general sphere of telecommunications, has improved tremendously.
"This is one of the side products of competition. The cost of acquisition of a new user is becoming so high that it is always worth retaining the customers you have because if those customers had to churn bringing them back to your network will cost so much more that we try our very best to retain our customers."
Asked about his expectations for the Christmas season, Dr Camilleri said demand was "constant". This he said was one thing that constantly amazed him. "Last Christmas, for example, was even stronger than the Christmas before. This Trade Fair was even stronger than the Trade Fair before.
"Obviously, this is not going to continue for ever. But we believe that there are not many more than 235,000 truly active subscribers. Factoring out people who aren't migrating, people who have a frivolous second line or whatever, then I would say there is easily another 40,000-50,000 lines to be picked up over time."
Dr Camilleri ended on a note of warning: "The truth of the matter is that our state of affairs at this stage in time is very positive but, again, this market is very fragile. If we were not so successful this far, we would not have been in a position to continue to compete effectively in the future because the amounts of investments that are required to continue upgrading our infrastructure and the expectations of our customer base has increased tremendously.
"So, one mistake by us or the regulatory authorities in general - and it could be a mistake done in good faith - could see companies go down. The interaction between the variables that keep stability is very complex and you can easily draw up a business plan which is nice and rosy but then find out that one simple move or one simple decision made either by us or by the regulatory authorities on the slightest thing, could distort the market in such a way where you see past gains going down the drain within days.
"So, I must emphasise - and this is an important issue - that sustainability in this sector both mobile and telecommunications and IT at large, is extremely fragile. And we've seen this also with operators that are massive compared to us abroad going down."