Bharti, which acquired Zain’s African assets for $10.7 billion in the largest deal this year, is under pressure to cut costs and turnaround its African assets. It also plans to implement its minute factory model, a success in India. Bharti has outsourced the company’s networking and information technology backbone, and targets low usage customers in addition to high-end customers.
Minute factory model allows the company to add network as and when the user numbers increase. It does not require Bharti to invest heavily in network infrastructure and reduces fixed costs.
“The company says the average minutes of usage (MoUs) per subscriber in Africa are lower than 100 (one-third of Indian MoUs), and there is, therefore, potential for exploring usage elasticity and replicating the minute factory model,” said HSBC in a report released during the Zain acquisition.