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Zoom Mobile Shuts Down Operations

06 May 2012

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Senator Annie Okonkwo


By Festus Akanbi
Zoom Mobile (formerly Reltel Wireless), one of the nation’s CDMA operators, on Friday eventually succumbed to the weight of its lingering crisis, largely brought about by losses and massive debts, by shutting down its switches nationwide.

Industry sources disclosed that in its desperate bid  to halt the losses, the  company on Friday effected the  sack of  some 200 skeletal staff  in  one fell swoop while its founder and chairman, Senator Annie Okonkwo, is said to be making frantic efforts to get new partners to resuscitate the telecom company.

The affected staff were said to be made up of those previously retained to provide skeletal services of running the company’s switches and base stations nationwide after it started its cost cutting measures last year.

Zoom Mobile, at the peak of its operations four years ago, had over 1.5 million voice and 100,000 data subscribers but industry sources said yesterday that apart from its largely whittled down customer-base that has been left out in the cold by the current development, other categories of the company’s business partners worried over the fate of the company are banks and creditors.

However, Okonkwo told THISDAY Saturday that what the company did was to partially suspend its operations in order to save cost.

He said the company ordered the staff to proceed on indefinite suspension because it had become unprofitable to run the business until new investors are brought on board to recapitalise the business.

According to him, the company which in recent times had been generating N9 million monthly was spending N150 million on its operations on a monthly basis, explaining that it did not make good business sense to continue to run the company at a loss.

Okonkwo, who insisted the company was still in business, said some categories of staff were still being retained to provide skeletal services.

The chairman confirmed the company’s search for new investors, explaining that Zoom was already in discussions with some Chinese investors, who he said, will build a fibre network to enable Zoom compete favourably in the emerging business climate in Nigeria. Although he said the company was also looking at the possibility of bringing other investors apart from the Chinese into the company.

He described the company’s action as an ongoing development, saying zones affected include Lagos, Abuja, Port Harcourt, Onitsha, Owerri and Warri. “We are still servicing our customers, because ours is a national licence,” he said.

The company’s founder explained that by shutting down its operations, the company would be able to save up to N2 billion.

On its obligations to staff, banks and other creditors, Okonkwo said the company will meet its responsibilities and will not do anything to affect the assets of the company, having established its presence in about 21 states nationwide.

Zoom Mobile was incorporated on August 25, 1998, as Reliance Telecommunications Limited (Reltel Wireless), taking advantage of the deregulation of the telecommunication sector by the then Federal Government of Nigeria. The company subsequently obtained a national licence to provide fixed wireless telephone services in Nigeria.

Nortel Networks of USA deployed Zoom’s first state-of-the-art CDMA network operating on 1900 MHz frequency, enabling it to commence full commercial operations in November 2001.

With the expiration of exclusivity period enjoyed by the GSM operators, Zoom Mobile successfully applied for the Unified Access Service License, enabling it to provide full roaming services in all of its areas of coverage.

Tags: News, Nigeria, Featured, Zoom Mobile

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