27 Dec 2008

More on the optimism expressed at GSM>3G Middle East

After considerable quantities of roast Turkey, mince pies etc., it's time to round up some more of what was discussed at our recent GSM>3G Middle East event in Dubai. The focus here is on the second day's proceedings.

One thing we took away from both days' discussions was the widely expressed sense of optimism that the Middle East's telcos will weather the economic downturn relatively unscathed. Day two opened with a speech from Dr Marwan Alahmadi, CEO of Zain's Saudi operation, who described the new entrant's successes to date - and was bullish about the way ahead.

Great confidence was also expressed by speakers from both FRiENDi mobile and Majan Telecom, two companies looking to thrive as MVNOs on the Omani market. The afternoon saw a robust presentation from Mobinil on the ever more pressing necessity to provide a dashboard of VAS to both protect current and expand future revenues. Judging by the enthusiastic questions directed at the Egyptian cellco's Commercial VP Guillaume van Gaver, this presentation struck a chord with a receptive audience.

For my part, I moderated sessions whose broad theme was around extending the availability and improving the affordability of communications services in lower ARPU markets with less easily addressable demand. Among the speakers in this session, it was great to meet Khaled Khorshid, currently the Regional COO of Zain Sudan. After sharing useful insights about how to grow a successful mobile operator, Khaled mentioned that his personal journey is about to take him to another outpost of the Zain empire - he is being dispatched to the Nigerian operation. Khaled was kind enough to volunteer to join the panel of speakers at the Com World Series event which takes place in that country's capital so I have encouraged my colleague who covers Africa to take up the offer. So look out for Khaled among the speaker line-up for West & Central Africa Com in Abuja in June 2009.

The Dubai event was enjoyable and rewarding for me - and I am looking forward hopefully to reading positive feedback from delegates early in the new year. The work leading to the creation of the 2009 Middle East event begins now.

25 Dec 2008

Impressions of day one of our GSM>3G Middle East event

Writing a blog entry on Christmas morning? A sure sign of a workaholic? Maybe for some. In my case, it's more to do with seeking some relief from watching my 3-year old son's Mr Men DVD for what seems like the zillionth time. Having risen at just before 5 a.m., the young man concerned has insisted on yet another run through every single episode of the classic kids' cartoon. I am not allowed to leave the room, it seems, so I might as well apply the brain to something other than the antics of Mr. Grumpy, Mr Bump et al.

This is, therefore an opportunity to share some of what happened at this year's GSM>3G Middle East conference and exhibition in Dubai, which kept my team and I busy on 15-16 December. I have time now to reflect on the event's first day - and will go over the second day's discussions once the seasonal round of visits to family and friends is over for another year.

The conference element of the event was opened by the Plenary Session Chairman, our very own Mark Newman, who spoke about how the Middle East's telecoms sector is booming, with mobile penetration set to grow by nearly 20 per cent to 77 per cent over the next 5 years. This bullish mood was echoed by the UAE's largest telco (and official endorser/sponsor of our event) Etisalat, whose Chief Corporate Affairs Officer Nasser Bin Obood used the Keynote Address to flag up the company's expansion plans. While I was on a short sunshine break immediately after the Dubai show, I got word of the next plank of this expansion strategy. Global Mobile Daily this week told me that Etisalat has submitted the highest bid for Iran's third mobile license, as part of a consortium that includes Iran-based Tamin Telecom.

According to Etisalat, the Iranian Communications Regulatory Authority has placed the operator "first among others in terms of financial offer." Etisalat added that the winner will be announced after official approval is granted. In a statement, Etisalat said it expects Iran's mobile market to have "a very promising future," because of the low penetration in the country, which has a population of 73 million.

Iran first began moves to launch its third GSM-license tender in August. However, the tender has remained overshadowed by legal wrangles after Turkey's Turkcell initiated proceedings in the International Court for Arbitration over its failed attempts to launch a network in Iran.
Foreign players known to be interested in entering the Iranian market include Russia's three major mobile players: MTS, VimpelCom, and MegaFon. Regarding the latter, I can personally testify to the Russian cellco not being coy about its interest in the Iranian licence. Back in June, I welcomed MegaFon's Deputy CEO Sergei Soldatenkov to our annual Russia/CIS event in Moscow, at which he was one of the key speakers. Later at the same event, Mr Soldatenkov was among the most notable people firing questions to a speaker from an Iranian delegation, which was on hand to raise the visibility of this and other investment opportunities in their country's telecoms sector. I am looking forward to another opportunity to meet Mr Soldatenkov in Istanbul. On March 31, he will be among the leading speakers at our Eurasia Com event, the Com World Series gathering of telecoms execs who have an interest in the markets of Central Asia, the Caucasus region and the conference's host country itself. Soldatenkov heads up the company which manages MegaFon's international subsidiaries, so he was a great choice to represent the company at an event whose audience will be drawn from the markets into which Russian cellcos first expanded their footprints. While I was out of the country, I learned that the Eurasia Com Plenary Session roundtable discussion, in which Mr Soldatenkov will be taking part, has a further confirmed participant. Joining the discussion will be a genuine mobile sector pioneer, Sir Julian Horn-Smith, who retired as Deputy Chief Executive of Vodafone Group plc in August 2006, having served with Vodafone since 1984 and for a decade as a board director, latterly from 2001-05 as Chief Operating Officer. One of Sir Julian's current roles is serving as an Advisory Board member for Altimo, the Russian investment group whose assets include stakes in Vimpelcom, MegaFon, Kyivstar (Ukraine) and Turkcell.

Another Keynote Session speaker in Dubai this month was Ross Cormack, CEO of Omani MNO Nawras, who spoke about how his company has benefited from being first to market with 3.5G services: "We had to make sure we had customers that wanted the service and services that they would want. So we listened to customers and responded to customers. The result has been pleasing growth and it's not as though we're going up against an unpopular competitor."

What was evident from the first day's discussions is that mobile broadband in the Middle East is heavily tipped to grow as strongly as in Europe. During the lead in to the event, I had the pleasure of exchanging correspondence with Dr. Slim Saidi of Zain's new KSA operation. Slim was instrumental in setting up the Zain Saudi Arabia CEO as a day two speaker and stood in for Dr. Marwan for a day one roundtable discussion, during which he indicated that there is significant potential for mobile broadband and that it is now just a matter of reaching those subscribers and providing access.

This rallying call was picked up by Farid Lekhal, Chief Commercial Officer of Vodafone Partner Markets, who said the way forward is to exploit the potential of the latest internet-capable devices and champion the accessibility of on-portal and third party services.

Vodafone has had the opportunity to learn from the mistakes made in its partner markets, leading the operator to conclude that third party applications do not cannibalise traffic on the network. "On the contrary, they expand it, and there is still room for operators to have portals," he said.

Tayfun Cataltepe, Chief Corporate Strategy Officer at Turkcell, shared the other operators' enthusiasm for internet mobility, declaring that, "Mobile broadband doesn't mean you have to be a dumb pipe."

"Mobile broadband is the future of telecoms on the whole, and the term 'broadband' will even fall out of usage as all connectivity will become 'broad'," he said. Cataltepe revealed that the Turkish cellco will launch 3G services in June 2009, and hinted that it would enable third parties to provided services on the network as a core part of its strategy. "The classical VAS (value added service) model is based on revenue sharing," said Cataltepe. "Those with the most creative services will make the most money, so operators will need to seek a revenue sharing agreement," he said.

Zain's Saidi agreed: "Access is a commodity now, so people are willing to pay for services they use. When the customers demand services it's up to the operators to deliver," he said. Also on the panel was Fouad Brahim Boumakh, president and CEO of Nano-Techpower, a start up which specialises in using nanotechnology to improve the battery performance of wireless devices, who summed up the sentiment over mobile broadband: "The name of the broadband game is any application, anywhere, on any device." Fouad approached me about joining the discussion a couple of weeks ahead of the event, and I was pleased to accept his proposal when I learned that his company is set to roll out nationwide WiMAX-based services in Algeria. I felt that adding this kind of new entrant to the discussion would usefully broaden the perspectives represented on the panel.

Later the same day, I enjoyed personally moderating one of the conference breakout sessions, whose broad theme was around how operators will need to refine further their marketing and product strategies as their markets become yet more competitive. It was a pleasure to introduce the various speakers, to chip in with questions where I could and to encourage audience members to do likewise. I am very keen for guests at our events to maximise the opportunity to engage with the speakers we assemble for them. I hope I was able to achieve this to a useful degree. Also, sitting up on stage in front of a large audience is actually easier than the many, many tasks executed by my Informa TM colleagues on-site at the event, all working hard to make sure delegates' time with us is maximally enjoyable and productive. At an event of this scale, the guys and girls of the Com World Series team really do perform brilliantly and I'd like to thank them all here for their good humour, good fellowship and hard graft.

Among the speakers I was personally able to introduce was someone with whom I've maintained an on-and-off correspondence for at least a couple of years. It was therefore a particular pleasure finally to meet Tushar Maheshwari in the flesh. Tushar is now Chief Commercial Officer of Warid Telecom Uganda, who picked up a gong at our recent Africa Com Awards in Cape Town. Tushar took questions after his speech and then dashed off to another awards ceremony elsewhere in Dubai to collect yet another prize on behalf of his company. As these accolades clearly demonstrate, and as his presentation made clear, Warid have had an impressive first year in Uganda. Tushar is clearly a man unafraid of a challenge. When I first connected with him, he was in the CCO role at Afghan Wireless, a competitor in a uniquely challenging market.

Across the two days in Dubai, aorund 2,000 people from operators, service providers, vendors, regulators and the media gathered at GSM>3G Middle East, which we subtitled Towards a Broadband World in order to make it clear that in the context of many forms of convergence (fixed-mobile, telco-media, telco-IT etc.) we feel it's high time to widen the audience beyond the cellular sector players who have supported the event for a decade-and-a-half.