16 Mar 2012

Dmitry Kromsky shares Vimpelcom's CIS strategy ahead of EurasiaCom


Dmitry Kromsky heads the CIS business unit at Russian-based telco VimpelCom. he began his career in telecommunications over 15 years ago, working at Samsung Electronics, Vostok Mobile.b.v. holding and MCT Corp.
He came to VimpelCom in 2002 as the Central region director before being appointed General Director of LLP Kar-Tel (TM Beeline in Kazakhstan) and having his remit extended to look after other acquired companies in the CIS. In 2009 he became Vice President, CIS Business Development, and has headed the CIS business unit of VimpelCom Ltd since 2010.
Here he answers questions from the Com World Series team on his company's strategy in the emerging markets of the CIS and on how to adapt to changes in the telecoms, media & ICT market.

CWS: What is Vimpelcom’s regional strategy in the CIS?
DK: The CIS business unit’s purpose is to grow faster than the market, to increase the market share and demonstrate positive dynamics in subscriber base. Strategic focus of our business is still the development of broadband Internet access, both mobile and fixed.
Moreover, as a part of VimpelCom group we will continue to be on the delivery of our Value Agenda and the 2011 financial results provide a good platform for profitable growth and improved cash flows.

CWS: Which markets offer the best opportunities for growth?
DK: In comparison with developed markets, emerging markets of the CIS countries have the great potential to growth in different directions. For example in Kazakhstan where internet penetration rate is about 53% of the country's population*, we are focusing on FTTB network development. As a result, fixed-line broadband subscribers base increased 5 times in 2011.
But in some CIS counties, such as Tajikistan or Uzbekistan, even mobile penetration is below 90%**, thus we have huge opportunities there. Overall, the expansion goes very rapidly and despite of intensified competition, VimpelCom revenues continued to grow at double-digit rates YoY in all CIS markets as a result of improving macroeconomic conditions, strong product offerings, and efficient sales and marketing efforts.

CWS: How is Vimpelcom adapting to new market conditions such as increased competition from new players like Google or content providers?
DK: Increasing competition from content providers forces operators to adjust their business models to maintain business growth and achieve an acceptable level of profitability. VimpelCom follows such changes very closely and ready to correct its approach if necessary.

CWS: How is the operator’s business model changing, and what shape will it take in the future?
DK: The main trend in operator’s business model is focus shift from voice services to data transfer. Increasing data traffic trend let us double data revenue of CIS business unit in 4Q 2011 YoY.
The most considerable growth was noted in those countries where we recently started 3G networks development, such as Kazakhstan and Kyrgyzstan. So, for example, in Kyrgyzstan data usage trends drove a significant mobile data revenue increase of 151% YoY.

Unfortunately, Dmitriy Kromsky will be unable to attend the EurasiaCom event in Istanbul on 20-21 March. The event will include presentations from leading regional operators (including Turkcell, MTS, Turk Telekom, Kyivstar, among others) as well as telecoms & ICT vendors, regulators, digital media specialists, content providers and more.

*The Statistics Agency of Kazakhstan 2011
**ComNews Research data 2011