THIS IS A BIG JOB. No wonder Rogers Communications Group’s president and COO Nadir Mohamed doesn’t want to talk about succession. He’s got lots on his plate to worry about now, rather than what his next job might be.
Besides, last week’s National Post Business article beat that story to death (and then some) last week.
What we wanted to know is where the company’s priorities lay. What’s job one for him rightnow? How is he going to bring together two disparate groups (cable and wireless, together a $5 billion business), two completely different technological platforms, into a cohesive, branded unit that’s all about digital communications?
And, at the same time, he’s integrating Call-Net (Sprint Canada), which was purchased earlier this year – as well as Microcell (Fido) which was purchased last year.
Oh yeah, and be everything to your customers and try not to rankle the employees on the ground who are also dealing with these massive, quick changes.
Can you see why the former BCTel and Telus executive (he launched what is now Telus Mobility) doesn’t want to talk about – or even have the time to think about – his next job? There are enough pressing tasks in the in-box already.
What follows is an edited transcript of Mohamed’s chat with www.cartt.ca editor and publisher Greg O’Brien last week.
Greg O’Brien: What are your priorities?
Nadir Mohammed (right): Very straightforward. The first one is very simple. For cable and wireless: How do we improve the business? There’s a lot of stuff we can do, but when I wake up, first thing is how are we doing? How were sales yesterday in cable and wireless and telecom?
So, the first priority is to improve the business for cable and wireless and Rogers Telecom.
The second priority, which is particularly important in the current time frame, is the Microcell integration. It’s well under way. If you heard our (conference) calls you know where we’re at publicly, but clearly it’s a major piece of work in terms of integrating a large company into the fold, keeping the Fido brand, but integrating the back end. That takes a fair amount of work.
The second integration is Call-Net, and we’re in a relatively early stage – it’s just been a couple of months and essentially, as the executive sponsor, I lead the integration efforts there.
So, those two integrations are a big priority in the short term and I’d love to be saying next year at the same that they’re well behind and we’re running as one entity – but there’s a ton of work to be done in the next short little while.
So that’s priority number two. The next priority is the idea of asking — “how do we actually leverage the platforms from the Rogers brands?” — whether it’s distribution and sales on the front end, some of the branding initiatives, through to the technology platforms – how do we actually leverage this for more than one product portfolio?
Our history is cable selling cable, wireless selling wireless and telephone selling telephone. Increasingly, customers are asking for whatever they may want (when they call), so starting to leverage the platforms is an important thing.
The flip side of it is that we also have a very strong view from a technology perspective that these networks will actually start converging. So we’ve created a position of CTO for Rogers (Bob Berner) and the intent is to start with a road map and say, how do these things, on the network side, as platforms, come together. And it may not mean today but we need somebody to think it through and create a road map of the architecture and start building towards that state.
So, it’s cable, wireless, telecom results; two integrations; joint platform work; and then finally making sure that with all of this going on – some of which is internal organizational work – that we don’t lose sight of the two biggest constituents that I worry about: keeping the focus on customers, and making sure that all of our employees feel good, are engaged and motivated because the two work hand-in-hand.
I spend a lot of time communicating with people internally about where we’re going and what we need to do.
GOB: It’s not an easy thing, I don’t think, because these were all separate fiefdoms before. Everyone had their own, what’s the word, silo, to work in.
NM: Well, silo has that connotation that’s negative.
GOB: Sure, but what I mean is that you’re trying to bring these two together (cable and wireless) and communicating and getting people to work together and be willing to go back and forth… It can’t be easy.
NM: I do not want us to – as we do all of the things together — lose focus. Silo and focus you could argue are the flip side of each other and even as we build towards common platforms and common distribution, there’s no question in my mind that today we have four product portfolios: wireless, wireline, cable/video, and Internet.
Each one has to be real good for the customer to go “you know what, I like doing business with them, they have a great product. When I buy wireless, I want the best features, the best-looking device. I want the phone to work wherever I am whenever.” If they’ve had a great experience, when they’re looking for the next product, they love Rogers and will go there.
GOB: From a back-end point of view, the two critical things are billing and customer service. One of your competitors (Bell) had serious problems with billing… I’ve heard Ted talk about a single bill for everything. How have you addressed the billing aspect of it?
NM: We’ve done a fair amount of work. We offer a single bill to customers that have multiple products. We have for some time now – a few hundred thousand customers take one bill. A few years ago, we went to the Amdocs platform – the same platform that you are referring to. That’s the platform that does all the wireless billing and also the bill presentation layer for someone who wants cable, wireless and telephony. To that extent on the billing side, we have the capability to offer one bill but your point is dead on.
It’s interesting because billing really is the glue, central to our business. Billing is one piece of the customer interface so when somebody calls in, our rep has to be able to think of the person as a Rogers customer, increasingly with more than one product. So, we’re building a lot of capabilities on the front end to start really accommodating a holistic view of the customer and on the back end, if you’ve got billing integrated then you’ve got collections that need to be integrated and service provisioning and so on so it’s definitely a journey and I don’t want to suggest we’re there.
GOB: From a customer service point of view, I’ll give you an example of a friend of mine who works as a consultant to the cable industry. His monthly Rogers bill is around $800.
NM: We like him. A lot.
GOB: He’s got digital cable, the Internet, a couple of wireless phones, a bunch of stuff.
NM: Can we get his name?
GOB: Maybe after the interview. But from his point of view as a customer, he was moving and doing a number of other things, and he called Rogers and had some issues and was wondering if Rogers is moving towards a single point of contact, or the “super-CSR” or a level of CSRs who can deal with everything the company offers and with this type of customer in a single call?
NM: Over the last couple of years, we started building capabilities into customer service. We have folks who specialize in wireless or who are specialists in cable and increasingly, there are more and more reps or consultants who are referred to as “the common group” who can handle any of the products. So, from that perspective we’ve got the emergence of a whole new call centre – not physically – but spread out where we have lots of folks who can handle the products and services.
It really takes a lot of systems work to make it elegant, so when I say we have a person who can handle both, it still isn’t as graceful as you’d like in terms of systems. The hardest thing is to make it easy so there’s a lot going on behind it all, in terms of intelligent systems.
It’s an age-old battle going back in my twenty-some-odd years in telecom: The balance between a super-rep and a specialist. Quite frankly… our view is the fastest method to get a customer to the expert who can solve the problem directly is the best answer. What customers don’t like is to be handed off two or three times until they get an answer. So the more intelligence that can be right up front to find out the customer wants to talk about roaming… then get them to someone who really understands roaming and ideally, do it on the first call.
So, we’ve built a lot more intelligence in the front end in order to identify the issue. If you look at our interactive systems, they’re now increasingly designed to try and find out what it is the customer wants and to route it to an expert.
GOB: Your first point of contact is a male automated voice system, right? Bell has Emily – I don’t know if Rogers has named theirs – a voice-recognition system.
NM: Correct. So, on the one hand, the generalist queue ends up (going to) a super rep who can generally answer any question on any product. But then you have a separate orientation towards specialization so you don’t end up with everyone training to be a super-rep, and instead there’s a blend between people who can speak to many issues and the specialists.
GOB: How far are we away from the cable and wireless networks coming together with that wireless/wireline phone that people have been testing and talking about (a handset which is a home phone using the cable plant when in the house and a cell phone using the wireless network when out)?
NM: It’s still in trial. We’re testing this whole notion of having a wireless device that works just the way our cellular service does today and when you’re in the home, would flip onto the cable network – or the DSL network for that matter – and use the back-end network to carry the traffic. The ones that are out in the market today – Bluephone in Britain is probably the best example of a service that’s up and running from British Telecom. It’s exactly what we’re talking about and you’ll probably see in the next year-to-two a service that becomes commercial and meaningful (with Rogers).
GOB: Your career path has been in the wireless and telecom sector. Since you’re now COO overseeing the cable side, too, what’s the learning curve been like and has there been anything that’s really surprised you?
NM: A lot of learning. A matter of just talking and listening to as many people as I can, starting from being home for the installation of Home Phone – just so I can see how it actually gets done – through to folks who know the regulatory world as well as cable and marketing and so on. I’ve been around the communications business for many, many years and with Ted, there are lots of platforms for discussions with cable – whether it was with John Tory when I first came here – to now with Edward. You get exposed to it and you’re aware of the issues.
I love getting behind the financials to draw out issues and find how we can improve things but I’m certainly getting much more steeped in the business of cable and the metrics and what drives value and how do we improve things.
Having said that, the first couple months were less about learning cable and more about getting the Call-Net integration set up so that we could go about executing with a very firm view on how we wanted to move forward.
GOB: Is that proceeding well, because it’s more of an addition than a merger like Microcell because Rogers didn’t have a big traditional telco business?
NM: Really good question. A lot of people have asked how it compares to Microcell and it’s very different in the sense that with Microcell we were in the wireless business and that was bringing two companies together. With Call-Net, Rogers Telecom now, if you look at the pieces below the corporate umbrella, there’s a residential phone business which is being integrated with our Rogers Home Phone service that the cable folks just launched on the first of July.
The other piece is the business organization, which we’re now integrating with the Rogers business group which we had set up at Rogers, pre-acquisition. And then the third piece of the business is the carrier services business, which is pretty much a new addition in terms of the scale it brings to the organization.
GOB: There was something in the Globe and Mail I read last week about cable’s sort of clubby atmosphere being pushed aside with the Call-Net purchase because you’re now able to enter all these other cable territories now, where you hadn’t been before. Do you envision competing aggressively against Shaw and Telus in Calgary and Edmonton, for example, to offer phone service or do you see the company with a different role?
NM: When I look at Rogers I see one company, national in scope, with four products: Cable, wireless, telecom and Internet – and multi-segment: consumer and business.
Now, when I say that you naturally go, “hang on a minute, does that mean you’re going to go out and buy capabilities to become truly national with all four products?” I’m not putting a timeline but I am saying that with the vision we have is we’re building towards our national capabilities.
In products like wireless, we’ve been national for some time and we are the largest player in wireless today. Cable is very much based on franchises, so that’s Ontario and the Maritimes (for Rogers). It’s not national today but someday, who knows what might happen. But it is our intent, either working with partners through different technologies to over time, have a capability nationally or have a relationship nationally – and the same could be said on telecom and Internet..
Practically, having acquired Call-Net, we have services nationally. We have fixed wireless spectrum nationally. And are there opportunities to start doing some work, either with a cable partner or directly? For us to go in the west against the enormous power of Telus or Shaw, it has to be in the context of saying, “we may have some re-sale business with Call Net” but nobody should think of that as we’re competing with Shaw and Telus in any kind of core sense on telephony.
GOB: The theory I’ve heard people talk about – and I’ve written about it myself – is that it would be more in your best interests or more lucrative, to go and offer to Shaw or EastLink or Cogeco or whomever, access to the business world, where cable’s networks traditionally don’t serve and which Call-Net served well.
NM: One of the things we like about the Call-Net acquisition was that it gave us more scale in the business market and between that and our wireless presence in that market, we’re probably the cable company with the most interests in the business segment.
Different companies have seen different models… I think every communications company, whether it’s cable or wireless or wireline now talks about the triple play or the quadruple play so what we’ll see is the world unfold with either acquisition or partnering or joint marketing for that matter to try to get to be in a position where people say, “hey, you’ve got all the products that are part of this communications world.”
GOB: Talking about the wireless side of the business, for all three companies – it was a record quarter (of subscriber additions). How sustainable is the growth curve and what’s driving it?
NM: I really believe we’re in a sweet spot in the industry. It’s amazing, particularly when you talk to folks outside of Canada and describe the environment here and you say, “we’re just short of 50% penetration…” (meanwhile it’s in the 60s in the U.S., and Europe and Asia are in the 80s or higher) so there’s tons of room to grow on the voice side.
We’ve been growing in the 12% range for some time now (but) there’s tons of room to grow on the voice side. The interesting thing is that in terms of the wireless platform, that’s only one of the services. Data has been an incredible contributor. I think last quarter we were somewhere in the 7.5% range of our revenue coming from data.
If you go back – and I remember talking about wireless data in the west many, many years ago – there is no question, there has been huge growth, and growth within consumer and business segments is about even. That’s driven by new products like what we talked about, like the RIM, which is our bread and butter, but now also the Treo and My Mail kinds of services, you can really see that platform expand.
On the consumer side, short messaging has been the driver, but ring tones, gaming, music downloads, the whole explosion of services are all centred around the consumer market.
If you look at wireless data, some time ago I said that in 2006, we’ll have 10% of our business coming from data. If anything, that’s probably a conservative number. And it’s not just a Rogers story. The industry has evolved that way and we happen to lead it.
Now, we’ve been growing steadily, 7.5% to date, but in Europe, it’s more like 18% to 20%, predominantly coming from consumer because we’re actually further ahead in the business market here. You look at that and think the next few years should be pretty good at sustained growth.
What’s fun is that you can see the seeds of other services. When you look at a service like MobiTV, TV on a cell phone. Clearly from a network perspective, from a service set, it’s not full motion multi-media – we’re not going to do live games. Live clips and short programming? Absolutely.
But what it signals is we’ve gone from voice to data and video is going to be next and the fourth S-curve is going to be machine to machine. When you look at countries that have been ahead on wireless, mobile commerce is starting to become part of reality – a robust service.
GOB: Like buying a pop at a vending machine with your cell phone?
NM: Yes, but machine to machine beyond that type of application. Bringing it home, we won an RFP on Power Smart using smart metering. And when you think about it, that’s connecting machine to machine in an intelligent, real-time way. (The Rogers network will be used by Ontario Power Generation to monitor, via IP, the power usage in the home. If the province is faced with a power crisis, homeowners will be rewarded for turning on the dishwasher after 10 p.m. with lower electricity rates).
GOB: Is there a “next big thing” coming?
NM: I think music on wireless is going to be big. A couple of years ago, color and camera phones were huge for the category. Not so much for the amount of traffic that’s generated by people sending pictures back and forth, but for the category there was a real buzz. It was a new thing and it really drove wireless and the kinds of things you’ve heard about – iTunes…
GOB: Rogers is coming out with that Motorola one this month right?
NM: Shortly. I really think (music) will take the category to another space in terms of mindshare of kids and all of us.
GOB: I’ve been looking at that iPod for a long time wondering why no one’s stapled a phone to the thing.
NM: Coming soon. That’s one of those category-defining kinds of moments.
On the technology side, if you look at cable going digital, wireless is about higher bandwidth… I think fixed wireless is the next technology in terms of a new breakthrough that will work hand in hand with the other two.
GOB: How far away are the fixed wireless (WiMax) standards?
NM: That’s a hard one to give you anything other than what I read but I suspect sometime in the next year to two years is the best view that I have.
GOB: I’ve got one last question for you that I’d be remiss if I didn’t ask… about being the new number two executive at Rogers Communications and your aspirations to some day take the top job when Ted Rogers decides cede that position.
NM: Well… let me repeat for you the four priorities. To improve cable, wireless and telecom, get the integrations done, get the platforms working for the brand and worry about customers and employees.
How do you like that?
GOB: Just fine. So you’re happy where you’re at, then.
NM: I love what I’m doing.
