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Haitel Company Profile
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Page 1 of 13
Company Profile
Business name: Haitel S. A.
Address: 17 Rue Darguin
Petionville
Haiti, West Indies
Haiti Cell: 509-3510-0001, 3558-0010
Page 2 of 13
Table of Contents
Table of Contents ............................................................................................................. 2
Executive Summary ......................................................................................................... 3
General Company Description ...................................................................................... 5
Products and Services...................................................................................................... 5
Marketing Plan ................................................................................................... ………11
Conclusion………………………………………………………………………………14
Page 3 of 13
Executive Summary
Haiti Telecommunications International S.A. (Haitel) is the pioneer in the wireless
telecommunications services in Haiti. It is the first company in Haiti and the Caribbean
to have a 3G network. Haitel has a 3G CDMA 2000 1x 1900 MHz network and is the
only telecommunications company in Haiti that can offer a full range of wireless
services and products.
Haitel began its operations in July 1999. It quickly acquired more than 85,000
customers, and produced a positive Net Income by its second year of operation.
Today, Haitel has more than 430,000 active customers on either its basic prepaid plan or
post prepaid plan.
Haitel currently offers wireless mobile and fixed voice service, data and EVDO
services. Haitel is also an Internet Service Provider (ISP) offering both wireless and
wire line internet access services.
Haitel’s revenue comes from its domestic and international voice traffic and data, plus
EVDO service. It has coverage in all of the major metropolitan cities and most of the
popular rural areas in Haiti. On average, the active wireless customers produces
minimum in US $12.50/month in voice and $45/month in internet revenue. Haitel is a
100% prepaid wireless service company so therefore, it does not have any significant
collectible or accounts receivables issues with its customer base.
Despite the arrival of new and well funded competitors, plus the unstable political
climate and global economic downfall; Haitel still maintains a strong market share.
Haitel is still convinced that there is an even larger market waiting to be captured
despite the current explosion in the Haitian telecom market; because there is
approximately 2.5 million lines active out of the 10,000,000 inhabitant.
For example, according to a market study commissioned by Haitel in 2002, the Pyramid
Research Group predicts that the tele-density in Haiti will grow from only 1.4% in 2000
to 6.8% in 2011. To be more expletive , the total number of phone lines in Haiti today is
a maximum of 200,000 while the population of Haiti 8,000,000 people. The chart below
from the Pyramid Research study, illustrates this huge potential growth very well.
With a larger network and expanded back office capabilities, Haitel is in the perfect
position to capture the majority of this growing market.
Page 4 of 13
- Haitel Confidential -
Communications EnvironmentHaiti in the Region
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000
PPP GDP/Capita (US$)
Tel
eden
sity
(%
)
HAITI
BOLIVIA
DOMINICAN
REPUBLIC
COSTA RICA
ARGENTINA
EL SALVADOR
ECUADOR
VENEZUELA
MEXICO
CHILE
URUGUAY
Haiti’s teledensity is lower than the country’s GDP level would suggest.Haiti’s teledensity is lower than the country’s GDP level would suggest.
Chart 1: Teledensity in Haiti and the Region
Haitel’s initial funding of $45 million was obtained from Nortel Networks. Nortel
Networks is a significant Canadian telecommunications equipment provider. This
funding took the form of a 5-year balloon note. Payment is made by having all of
Haitel’s international telephone service correspondents pay all international settlement
revenues due to Haitel into an escrow account in a US bank. Haitel has paid every
interest and principal payment on time and has paid off this loan in December 2004.
However, since a significant portion of its cash flow was used to repay this short term
loan, Haitel would prefer to pay off any loan obtained in a better and longer term
financing.
Due to its tremendous success during its first seven years of operation and the upgrade
to the 3G network, Haitel is seeking an investment to increase its network’s capacity
and efficiency, and expand its coverage nationwide to capture more customers. Haitel
is also opened to a partnership.
Page 5 of 13
General Company Description
Mission statement: Haitel’s mission is to function as a customer oriented company with
a culture of quality so that the Haitian telecom consumer can profit from a full range of
high value and competitive telecommunications products and services.
Form of ownership: Haiti Telecommunications International S.A. (HaiTel) is a privately
owned company incorporated under the laws of Haiti with the following ownership:
85% Mr. Franck N. Cine
15% Other
Company history: The Company, which was incorporated in December 1997, had
signed a 15-year agreement with TELECO for the acquisition and exclusive operation of
the CDMA 1.9 GHz band in Haiti. In May 1998, Haitel had entered into a supply
agreement with Nortel Networks to purchase the equipment and services necessary to
construct the initial network. Haitel had also signed a 5-year $45 million Credit
Facility Agreement with Nortel to cover these costs.
Haitel currently has 9 sales centers including 4 in the Port Au Prince area. Along with
the sales centers, Haitel has over 200 retail distributors selling phones and telephone
cards. These distributors are strategically located throughout the network coverage
area.
Haitel also has international operating agreements with 6 major Carriers (4 US, 1
Canadian, 1 DR). Connections to these Carriers are through a combination of Intelsat
satellite facilities and undersea fiber optic cables.
Products and Services
Haitel offers the products and services described below in all of its 9 Sales Centers
which are conveniently located throughout the network coverage area.
Telephones.
Page 6 of 13
Haitel currently sells a wide variety of both fixed (Wireless Local Loop & Terminal) and
mobile phones. The phones comes from many different vendors mainly from the US.
Activation.
Haitel can also activates compatible CDMA customer pre-owned phones.
The activation strategy is to allow customers the flexibility of choice and to used phones
that were purchased by a relative in the USA as a gift on the Haitel network.
Customers may also choose to buy their phone through any of Haitel’s authorized
Distributors or of the many telephone outlets in Haiti.
Website
Haitel’s website is: www.haitel.ht
Recharge Card Sales
With the exception of a very few large corporate clients, all of the telephone services
described above are offered exclusively on a pre-paid basis. Customers cannot make
any calls if their account has a negative balance. Customers must purchase a Haitel
Recharge Card from Haitel or one its 200 Authorized Card Distributors and apply the
card to their phones account in order for the phone to work. Haitel pays these Card
Distributors a commission of 10%-15% depending on the volume purchased.
Card Denomination Equivalent USD Value (@40 Gdes:$1 USD)
50 Gourdes $1.25
100 Gourdes $2.50
250 Gourdes $6.25
500 Gourdes $12.50
Page 7 of 13
Internet Access Services
Haitel offers two different Internet access products.
1) Haitel’s Wireless Internet Access
This service allows Haitel customers to access the Internet through its EVDO service.
2) Dial-up Data Service
Haitel’s customers have the ability to use the dial-up data capability from many models
of both mobile and fixed phones. Customers can dial any modem in the world with this
product.
Domestic International Private Lines
Haitel offers digital private line services both throughout its domestic coverage area as
well as to any point in the world. Haitel currently offers this service from 64kbps to
2MB.
Page 8 of 13
The Marketing Plan:
General Information
Haiti is a grossly underserved telecommunications market. With an estimated
maximum of 2,000,000 telephone lines for a population of an estimated 10,000,000
citizens, the potential for customer growth is enormous.
Despite the generally poor economic conditions in Haiti, Haitel’s experience is that
customer demand for telephone service remains very high. Haitel’s success during its
first four years of operations is ample support for this belief.
Products
Haitel offers a wide range of products and services to its customer base. Currently,
these are:
1. Mobile and Fixed Wireless Voice Service. Haitel sells a wide variety of mobile and
fixed wireless phones. The prices range from as low as $99 to more than $250
depending on the make/model. This service is offered exclusively on a pre-paid basis.
Customers add credit to their phone accounts by purchasing cards from a Haitel Sales
Center or from one of more than 200 card distributors. Haitel also offers these wireless
customers a wide range of rate plans for personal or business use. These rate plans
range from the high end plan which has a monthly fee in exchange for free inbound
calls to the low end plan which is slightly more expensive “pay as you go” style plan.
Finally, customers can choose from a wide variety of optional services for their phones
including voice mail, call waiting and caller ID services.
2. Wireless Fax and Dial-up Data Service. Haitel offers these services to all of its
customers at the same rate as its voice service. To the best of Haitel’s knowledge, this is
the only network in the world that offers wireless fax service on a commercial basis.
3. International Private Lines (IPLs). Because Haitel owns and operates its own Intelsat
standard “A” earth station, it has a huge amount of international bandwidth at its
disposal. This state of the art earth station and 100% digital network puts Haitel in the
unique position of being able to offer these IPLs to our customers.
4. Internet Access Services. Haitel offers both wireless and wireline Internet access
services. Customers can choose from the fixed rate plan for unlimited service or a per
minute rate plan from their mobile or fixed phone.
Page 9 of 13
5. Debit Card services. Haitel offers a debit card that can be used from one of more
than 800 Haitel payphones or from non-Haitel phones in Haiti. Haitel has plans to
begin offering an international debit card in the very near future.
Customers
Simply stated, the entire Haitian population is Haitel’s target market. Since they are so
under served, they are all potential Haitel customers for one or more services. While
Haitel has created various services for the residential and business customers, almost all
Haitians need more telecom services.
Another aspect of Haitel’s market is that as many as two million Haitians live outside of
Haiti. Most families have at least one relative living in the USA, Canada or elsewhere.
This situation creates a need for a significant volume of international phone calls which
are the most profitable phone calls for any telecom company.
Competition
Haitel has three competitors in the market.
COMCEL
COMCEL offers 850 GSM MHz service which only allows it to provide limited mobile
wireless services. Their perceived strength is their strong marketing efforts. In addition
to their other major weaknesses is the quality and capacity of their network which is
prone to performance problems and outages. It is not perceived to be a high quality
network by the public.
DIGICEL
DIGICEL operates a 1900 GSM MHz network. Their perceived strength are their
financial support and marketing campaigns. As ComCel their major weaknesses is the
quality and capacity of their network which is prone to performance problems and
outages.
Despite these significant weaknesses of each of these competitors, Haitel respects them
as viable competitors. Above all, Haitel believes that the first competitor to complete a
reliable nationwide network coverage that covers all of the major cities will ultimately
win the competition for customers in Haiti and will be the dominant Carrier for many
years.
Page 10 of 13
Marketing Strategy
Since Haiti is such an underserved market, Haitel’s fundamental marketing strategy is
very simple and straightforward one;
Be the first Carrier to enter each major city
Provide enough initial capacity in each of these cities to capture at least
the vast majority of potential customers in each of these cities
Provide high quality and reliable telephone service to our customers.
Provide high quality customer service and after sales support.
Advertising: Since Haiti has literacy problems, Haitel focuses very heavily on radio
advertising. We have long term contracts with many of the most popular radio stations
in all of our served markets.
Pricing
Given the generally low income condition of most of our customers, the market is very
price sensitive.
1. Phone Pricing. While Haitel offers a wide variety of telephones at many different
price points, the majority of phone sales are for mobile phones that can be sold for less
than $100 US. Fortunately, these are readily available for purchase by Haitel in the
market.
2. Minute Pricing.
A. Fixed Wireless Service. The current pricing for Haitel’s fixed wireless
service is 2 Gourdes/min ($0.05 US/min) for both local and domestic long
distance calls.
B. Mobile Wireless Service. The current pricing for Haitel’s mobile wireless
service is 5 Gourdes/minute (0.125US/minute) for both local and domestic
long distance service.
Page 11 of 13
C. International Rates. Haitel’s international rates begin as low as 10
Gourdes per minute ($0.25 US/minute) for calls to the four most popular
calling destinations (USA, Canada, France and the Dominican Republic).
However, although Haitel has experimented with lower rates, it found that
there was no change in the volume of these calls. Haitel’s customers seems to
clearly prefer to receive rather than initiate international calls. Since Haitel is
compensated by the International Carriers at a higher rate for these inbound
calls, Haitel is content with this situation.
Finally, Haitel emphasizes that, with the exception of a very few large corporate
customers who receive limited credit, all of these services are offered only on a pre-paid
basis.
Distribution Channels
Haitel has arrangements with various distributors for the sale of both phones and card
products in all of its served areas.
1. Phone Sales. Haitel currently has agreements with three Phone Distributors. These
distributors may only sell Haitel compatible phones and accessories. These distributors
pay Haitel a fee, in advance, for each telephone number that they buy. Haitel retains
the exclusive ability to activate these phones on the network as a control measure,
however.
2. Card Sales. Haitel has agreements with more than 200 distributors that are located
throughout the served cities. Typically, these distributors are owners of gas stations,
grocery stores, bars, restaurants and other facilities with a high volume of customer
traffic. With a very few controlled exceptions, these distributors pay in advance for the
face value of the cards plus tax and less than a 10-15% commission based on the volume
of each purchase.
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