Reime: What gets measured gets done

Anand Garg is the incoming CEO of passive infrastructure supplier Reime Group. Anand came to Reime from Viom Networks, part of $ 100bn Tata Group, where he managed Southern and Western India, a $300m business with 21,000 towers and over 1,000 people. Anand wanted to take what he’d learned to make a difference to a smaller set up, and his previous experience setting up Neotel’s rural business in South Africa gave him the geographical and cultural knowledge to return to Africa.

TowerXchange: Congratulations on Reime Group’s centenary (December 2012). Please introduce us to the company.

Thank you so much Kieron and I am indeed glad to be speaking with you on the occasion of our centenary year. I also wish to avail of the opportunity to thank our esteemed customers for their support in this rather long journey.

Reime Group employs around 360 people in Africa. Apart from thirty expats, the majority of our team members are African. We believe in investing in local talent. We’re now one of the leading passive infrastructure service providers in Africa, with projects and services across the whole lifecycle from rollout to energy efficiency services to managed services.

Reime started out as a harpoon factory in 1912 in Norway, and then moved in the early 1950s into extensive production of hot-dip galvanized steel structures for the country’s power supply industry, producing 70% of the high voltage transmission towers in Norway.

New opportunities appeared in the rapidly growing market for telecommunication, so Reime focused mainly on design and production of hot dip galvanized towers and masts for radio link and cellular phones, and 70% of the volume was eventually exported. Decades of experience with Norwegian landscape and weather conditions gave the company the right foundation to be able to carry out demanding assignments worldwide.

A transformation of the business that started in 1996 has led to a highly internationalized business operation focusing on managerial and entrepreneurial services. By 2002, all steel production was outsourced to various partners worldwide. Reime Group later expanded further by offering its intellectual capital in the form of niche project management skills as well as software packages for monitoring and managing network rollout projects.

In 2007, Reime became a wholly owned subsidiary of ACME Tele Power Ltd., which is the flagship company of the ACME Group of India and an industry leader in the field of passive infrastructure solutions for the telecom sector. Reime became a one-stop shop doing the entire gamut of businesses, from tower supply and erection, installing passive infrastructure to post sales maintenance and servicing of the sites. The solutions offered by Reime thus expanded to include network rollout solutions, enclosure solutions, power management solutions, cooling solutions and network management solutions. With these patented, innovative and energy efficient solutions, Reime brings the value add to its customers by reducing their opex with their environmentally friendly green solutions.

TowerXchange: Reime has just about every major name in African telecommunications on your client list - where does your business come from, direct from operators and towercos, or via subcontracts from the major equipment manufacturers?

Most of our site build and energy efficiency product orders come direct from towercos and operators. Our managed services are subcontracted by the major equipment manufacturers.

TowerXchange: What practical steps can be taken to accelerate leasing and permitting when acquiring new cell sites in Africa?

We firmly believe in adherence to the law of the land. The only way to fast track leasing and permitting is to understand your obligations fully. Because of Reime’s presence in 14 countries in Africa, we have local knowledge about which permits are required on a country-wide and regional basis. The better you understand your local obligations, the better your ability to fulfill those obligations quickly.

TowerXchange: How does infrastructure capex and opex in Africa differ from typical levels in India, and what cost efficiencies have Reime Group been able to achieve?

A new cell site typically costs $80-100k in East Africa, $125-150k in West Africa. In comparison, the same tower can be installed for roughly half the cost in India. Opex running costs average $1800-2500 per month per site, depending on number of hours of quality grid power – DG and battery runtime constitute a significant proportion of opex.

For capex, besides the product cost, it is important to consider the logistics cost from sea port to final destinations in the Eastern and the Western Provinces of the continent. Opex cost varies mainly because of fuel price, space rent, per capita income (country specific) and labor wage act prevailing in the country.

Reime have developed solutions to bring down capex and opex. For example we have a unique low cost tower design which can be built for $65-66k, inclusive of everything you need - structure, power supply et cetera. This is a Nano tower – a 40 meter tower with capacity for 2 tenants, suited to rural areas with low penetration, but it can also be installed for urban in-fill sites where there are a number of towers, but capacity and coverage is inadequate. Reime can also design and install towers for up to 5-8 tenants.

On the opex side, we’ve done successful trials leading to orders from customers including Airtel, MTN, Tigo and various Towercos including Helios Nigeria, Eaton Towers and American Tower that have achieved benchmark energy savings of 35-40%. These savings come from our recent innovation called the Energy Management Unit (EMU). The solution allows the existing diesel generator to run at variable speed with regards to active equipment load and thus reduces the generator fuel consumption substantially. The EMU is further supplemented with our patented product called PIU (Power Interface Unit). This incredible solution makes up for the missing grid phase and steps up the line voltage as a result delays the genset run time and therefore saves operating expenditure.

TowerXchange: Anand, your LinkedIn profile mentions your belief that “what gets measured gets done” – what are the key performance measures for passive infrastructure management?

At Reime, we have developed unique solutions to measure KPIs of passive infrastructure management. At our state of the art Global Energy Management Centre (GEMC) we’re able to remotely monitor KPIs such as energy consumption, asset utilization, and technical field force utilization, which enable us and our customers to monitor and realise substantial opex savings.

We have alarm monitoring systems of course, and measure how quickly we can attend and implement corrective actions. It’s important to mention here that we have stringent KPI’s with our customers for Managed Services. In order to achieve 99.998% site uptime, we have to plan and deploy right resource at the right place and right time, so that the response to the cell site is a maximum of 90 minutes. For example, in Rwanda, Reime’s response time to reach sites in and around in Kigali is 60 minutes. Accordingly, Reime has deployed resident engineers who are equipped with tools to fix the problem at site. We also monitor engineers in the field from our GEMC, and are able to assess productivity and response times – that’s important to help us understand if we’re adequately or over-staffed.

These measures are all critical in ensuring we meet the exacting Service Level Agreements set out in our managed service contracts.

Similarly, we use PROMASYS, a unique equipment ordering and cost monitoring integrated project planning and tracking tool which helps us monitor and track our project completion on a timely basis without any surprises.

Health and safety of our assets and employees is at the core of everything we do and therefore, as a company, Reime adheres to stringent HSE (Health, Safety and Environment) norms.

TowerXchange: Can you tell us a little about how Remote Monitoring Systems are used to combat fuel theft?

The calibration of the fuel tank is one of the most important features of RMS. We can track fuel utilization. We know the quantity put into the DG, we know the DG capacity and track the runtime. So we can establish whether there was any abnormal discharge from the historical data of fuel consumption.

TowerXchange: Do you expect the African tower industry to develop along similar lines to the Indian market, where the majority of assets transferred from operator-captive to independent towercos, managed by specialist infrastructure companies?

There are indications that a similar change is already taking place in Africa. The establishment and growth of ATC, Helios Nigeria, Helios Towers Africa, Eaton Towers, Africa Towers (Airtel) & IHS bears testimony to this.  While some MNOs think retaining their towers is a strategic advantage, they think that owning the towers means owning the customer, others have realised that by hiving off towers to infrastructure management specialists, the operator can concentrate on their core business of marketing minutes on one hand and reduce the burden of both capex and opex to a large extent by sharing the passive infrastructure on the other. Thus sharing of passive infrastructure in Africa has become a reality and will gain further momentum in times to come.

It’s good news for passive infrastructure service providers like Reime as it provides us with an opportunity to work with all stakeholders in the value chain: towercos, MNOs & energy providers.