Phone dealers, Tecno bicker over market share

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Phone dealers at the popular Computer Village in Lagos, Nigeria have called on the Federal Government, the Federal Inland Revenue Service and security agencies to investigate the activities of the Chinese mobile phone brand, Tecno, for what they described as practices unfavourable to the foreign direct investment drive of the present administration.

The traders, under the aegis of Phone and Allied Products Dealers Association, claimed the Federal Government was losing billions of naira to the anti-Nigeria trade practices of the Chinese phone brand.

The PAPDAN stated this on Monday, even as Tecno claimed that it was adding value to the Nigerian economy by importing mobile phones that had enabled Nigerians to enjoy voice and data services that hitherto was an exclusive privilege of the affluent,

However, the President of the traders’ association, Mr. Ike Nwosu, who spoke to our correspondent, said Tecno did not believe, in the real sense, in any long-term investment in Nigeria.

Nwosu alleged that Tecno did not operate a bank account in Nigeria. “The Chinese brand operates a series of bank accounts in Dubai and some other countries in Asia where Nigerian traders are made to transfer monies to before Tecno brings in its phones.

“Nigerians have been made to lose billions of naira through this trade practice because Tecno does not even respect their own rules of engagement,” the PAPDAN president said.

He added, “For instance, if you transfer N200m to this account, Tecno will not give you phones to that value. On the contrary, they might at best give you about 40 per cent of the value and hold onto the remaining. What this means is that the traders are by this means, denied the opportunity to stock competing brands of phones because capital would have been tied down by Tecno.”

This strategy, Nwosu claimed, had enabled Tecno to avoid paying taxes, adding that while the company had succeeded in branding nearly all the shops in the phone market, it refused to brand its own corporate office.

Nwosu also wondered why a brand that sold more than 85 per cent of its phone brands in Nigeria would choose Ethiopia for the building of its factory in Africa.

“Why should Tecno be building a factory in Ethiopia ahead of Nigeria? Does it make any economic sense? Does it not show that they do not have long-term faith in the Nigerian economy,” he queried.

He asked government to urgently look at the nature of business of the Chinese brand, “to ensure it is in line with its foreign direct investment drive and to ensure their business gives maximum value to the Nigerian people.”

Tecno has been embroiled in controversy with Nigerian traders at the Computer Village for sometime now. Matters came to a head when the Standards Organisation of Nigeria invaded the phone market a few weeks ago and seized phones valued at over N200m.

SON had claimed the phones were counterfeit brands but the phone dealers argued that the raid must have been instigated by Tecno which feared that value brands registered by Nigerian traders would drive them out of the low end of the market.

During the raid, the traders had demonstrated against the Chinese brand during which one of them was arrested and detained for 35 days.

Already the traders have petitioned the Inspector General of Police, Suleiman Abba; the Senate President, David Mark and the Minister of Interior, Abba Moro, seeking their intervention to protect their rights to do legitimate business in Nigeria.

Asked why traders should import counterfeit phones, the traders’ leader denied the allegation saying that the Nigerian traders had registered over 35 brands of phones with the SON and actually took officials of the regulator to the factories that made their phones in China.

“We took SON to China where they saw and approved the brands we registered. When we formed this association, the idea was for us to institute a regime of self-regulation that would facilitate the elimination of counterfeit phones in Nigeria. We carried SON along and all the brands we import have SON’s seal of approval,” he stated.

Meanwhile, Tecno says the African market has always had a huge purchasing potential and can build a strong affinity for value-driven products only if Ordinary Equipment Manufacturers vendors understand the peculiar needs of the African market space.

In a statement made available to our correspondent, the company said it understood Africa’s unique infrastructural challenges and consumer behaviours and tailored their products to meet these needs.

“In 2006 when Tecno Mobile entered Africa, there were existing top global brands already operating within the African space from the likes of Nokia, Alcatel, Motorolla to Samsung, to name a few. However, none of these global brands factored in the power challenges and the fairly nascent infrastructural development across the continent in their design of mobile products.

“Many of the mobile network service providers at the time had infrastructure that struggled to deliver quality voice connections across a wide range, little wonder the advent of dual-SIM mobile products by no other than Tecno Mobile,” the statement read.

The statement was signed by the Vice President, Tecno Group, Arif Chowdhury.

He said, “I believe that the dual-SIM philosophy of Tecno Mobile for Africa is hinged on the fact that telecommunications infrastructures for landline services are underdeveloped and overburdened and cannot meet Africa’s overwhelming need for voice connections.

“The fact that many African cell phone users were demanding a mobile device that could hold more than one SIM card was an insight into the African consumer’s need that begged to be utilised. Tecno Mobile Nigeria was the first vendor to introduce the dual-SIM technology to the African market and at price-friendly rate; Africa could not but take notice of this newcomer.”

Chowdhury said that Tecno did not relent in cashing in on the opportunity the Africa market presented, saying Africa was willing to do business with the new OEM vendor, irrespective of the dominance of the market then by Nokia and Samsung.

“With affordability, aspiration and originality cleverly incorporated into its product offerings, the Tecno Mobile customer base began to swell. By 2009, Tecno Mobile had become an accepted and robust competitor at the low-end mobile devices category, delivering value to price conscious African consumers at ridiculously affordable rates,” he said.

He also said, “One thing is for certain; Africa has made giant strides in the past decade in telecommunications and Tecno Mobile has risen from the ashes alongside Africa.”

The Tecno Group vice president said Africa was now home to some of the world’s fastest growing economies averaging an annual growth rate of more than five per cent with a growing middle class that craves premium smart phone experience.

He said the company’s products, in the same light, had experienced exponential growth in the shipments of its mid-end mobile devices to Africa year over year.

“Having consolidated on its growing brand equity and positioning, one can rightly say with no iota of mischief that in less than 10 years of Tecno Mobile’s African market entry, Tecno Mobile has become a major OEM vendor to reckon with in the African mobile tech space,” Chowdhury added.

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Copyright – Global Runs 2014

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