2,500 telecoms executives expected in Dubai next week for Telco World Summit

Part of the Com World Series, the Middle East Telco World Summit is due to open its doors on Monday, with an expected 2,500 participants from 80 countries, and 70 different oeprator companies represented.
The event has been going on for over 15 years, and has seen the emergence of the Middle East as a powerhouse of telecommunications for emerging markets. This year's conference is focusing on Middle Eastern operator groups' strategies to move beyond the region and become global players. It is no surprise then that Etisalat is a strategic operator partner of the event. The company's global presence may not yet be as broad as that of for instance Zain (also present at the event), but it is definitely making a strong mark on high growth emerging markets such as West Africa.
The conference programme covers all the key strategic issues in the market (from network developments to regulation, value-added services and marketing strategies), and also incorporates two brand new elements this year: The Saudi Arabia Focus Day dedicated to the Middle East’s fastest growing market and the two day Telecoms HR Summit set to analyse the changing role of HR managers during the current economic downturn.
I will be at the event for the first time this year and I am looking forward to witnessing the debates in this exciting market. I am curious about the general mood in the region following the city's economic difficulties. Judging from the response to next week's event, I would guess that the city's busy events industry won't be severely affected by this.

Cost-efficiency and outsourcing major focus for operators in 2009-2010

Zain’s announcement this week that it is to outsource its East African networks (in Kenya, Tanzania and Uganda) to Nokia-Siemens Networks is not surprising considering the focus of the company on cost-efficiency. Chris Gabriel, CEO of Zain Africa, said in a statement that the outsourcing agreement was part of Zain’s Drive11 strategy of improving efficiency and network quality and that it will enable the operator to focus on its customers.
Mr Gabriel gave the opening keynote speech at the AfricaCom congress held earlier this month in Cape Town, and dedicated a large part of the presentation to the subject of outsourcing, a change from last year’s speech which focused heavily on the power of the brand. This year’s message resonated heavily with the audience and other speakers, as African operators are facing declining ARPU levels and looking at cost-efficiency strategies. The AfricaCom event was a great place to discuss them, with sessions on managed services, infrastructure sharing, call centre outsourcing, network deployment and sustainable solutions, as well as a number of companies promoting their products in the adjacent exhibition. Among them were the aforementioned NSN and its close rivals Ericsson, Huawei , ZTE, but also companies specialising on aspects of outsourcing such as call centre company PCCI, tower sharing solutions vendor Turkkule and more.
Gabriel and other speakers advocated new partnership models between operators and their vendors, and he is certainly making this a priority for the group as other deals have been announced in the last few months in its African operations (a five-year managed services deal with Ericsson in Nigeria announced in June for instance).
This will certainly be a major topic of discussion in the coming year: Informa Telecoms & Media predicted in their end-of-year Industry Outlook event in London today that network sharing and outsourcing was going to be one of the Top Ten major issues for operators in 2010. Informa’s top analysts announced that the telecoms industry should “expect further infrastructure sharing announcements during 2010 as operators attempt to extend coverage and reduce costs. Both network sharing and outsourcing will continue to gain momentum as mobile operators seek to reduce their capex and opex burden. Each of these individually is already an established trend but we can also expect to see more variations on a theme where the two approaches are combined.”
Cost efficiency will be one of the key topics discussed at events in the Com World Series in 2010, as well as broadband developments (with LTE gaining interest in emerging markets), value-added services (with mobile banking still a major issue, but also more on data), marketing and customer relations and more. I am currently working on the programme for our next West & Central Africa Com event, which will be held in Dakar, Senegal. If you want to be involved in the programme or send suggestions of topics and speakers to include, don’t hesitate to get in touch!

In times of changing market conditions, operators turn to Darwin for inspiration

Telecoms markets worldwide, and even more so emerging ones, are going through profound changes. Whether you look at business models, supplier relations or services, all operators need to embrace change in order to compete in a market that is affected not only by tough economic conditions but also going through changes in its ecosystem. It’s no wonder then that Charles Darwin is so often quoted by telecoms executives these days, with his famous words: “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change.”
It was mentioned a few times at the ‘Convergence in Istanbul’ event organised by the SAMENA Council this week, where people were also talking about “new rules of the game” and “a new paradigm” in the way operators must approach the market. The main change all telecoms players are facing is of course the economic situation. Once again, speakers were keen to point out that the telecoms sectors isn’t as affected as others by the downturn. But operators are experiencing a renewed interest from governments to be involved in the sector, as it is widely seen as an engine for recovery. In a rare show of unity, the CEOs of some of the region’s leading operators, incumbents and challengers alike (Turk Telekom, Etisalat, STC, Mobinil, Alpha, du, and more) voiced their concerns today.
One of the major topics at the event, and a direct link to the economic situation, was how operators improve their efficiency (this was the focus of a pre-event day hosted by Nokia Siemens Networks, and came back in most of the talks at the main conference). Running leaner operations is a key aspect of operators’ efficiency strategies, in particular thanks to outsourcing. But most interestingly the relations between operators and their vendors are being redefined, changing the shape of the telecommunications ecosystem. Indeed, new needs in the market, new technologies and new business models mean that forward thinking operators are building relationships with vendors that are based on partnership rather than a client/supplier basis. One positive consequence is that such partnerships help foster innovation in operations, technologies and services. Another partnership model touches on the financing itself: the ’pay as you grow’ model, where the vendor takes an interest in the operator’s success.
Has this change been brought upon or accelerated by the tough economic climate, or is it a natural evolution of the market? The new, more efficient models are being pioneered in markets such as India and Africa, so it may be that fast-growing emerging markets are breeding grounds for innovation.
The shift in the telecoms ecosystem and business models will be one of the key topics addressed at next week’s AfricaCom congress, the 12th annual pan-African event to be held in Cape Town. Judging by the record registration numbers and interest from companies from around the world, this event should be a great place to share thoughts and encourage innovation in telecoms markets.

Telecoms and media industry survey - share your views and win a report or iPod touch

My market analyst colleagues at Informa Telecoms & Media are conducting a survey to capture the mood of the telecoms market and I would encourage all of you to take part. Here's how it works:

As 2009 draws to an end we want to understand what you feel are going to be the hot topics in the telecoms and media industry in 2010 and how your business is performing in the current climate.

By taking part in our short survey, which will take just 5 minutes, you will help us to define our industry research and conference agenda for next year. In return, you'll receive an overview of the results and you will be entered into a prize draw where 10 people will each win a research report of their choice, and one winner will receive an iPod touch.

To take the survey visit: http://www.informatm.com/itmlogos/survey/io/io_2010.htm

North Africa Com 2009: North Africa still showing strong growth in changing market conditions

North Africa's telecoms market is set to remain on of the most dynamic of the emerging regions, judging by the successful opening of this year's North Africa Com congress. The event opened today in Cairo with a stellar line up of speakers and record breaking attendance, allowing busy networking among the participants.
According to my colleagues attending the event, the discussions focused on how to move the region's telecommunications market forward, as telecommunications companies in the region are adapting their strategies to face new market conditions. Following several years of high growth and increasing competition, the telecommunications sector isn't as affected as others by the global economic downturn, but operators are facing new challenges related to investment, consumer spending and high operating costs.
The programme included strong representation from host country Egypt, Algeria (one of Africa's fastest growing markets), as well as leading operators in Tunisia and Morocco.
Emerging markets specialist Orascom Telecom was represented by Mr Tamer El Mahdi, the CEO of the Algerian branch – Djezzy – OT’s most profitable branch. Mr El Mahdi described how Djezzy is “fighting in the trenches” as the changing economy begins to affect telecommunications in North Africa, but he also painted a positive picture of the operator overall, describing how revenue is rising steadily, as well as a similar trend in cutting costs – very promising for this leading operator. There were also positive messages from Dr Olfat Abdel Monsef, Vice President, National Telecommunications Regulatory Authority (NTRA), Egypt, as she described the regulators aim of a more simplified regulatory process, eventually focusing more on competition regulation – rather than licences, etc.
Other leading speakers from Day 1 included Mr Abderrahmane Mounir, Director of B2B for Meditel, Morocco, Jean-Carl Mazigi, Chief Strategy Officer for Wataniya Telecom Algeria (Nedjma), Sami Ayoub, Deputy-CEO, Tunisie Telecom, Khaled Hegazay, Corporate Affairs Director, Vodafone Egypt, Ricardo Tavares, Senior VP, Public Policy, GSMA, Wael Fakhanary, Egypt & NA Manager, Google. This broad spectrum of industry thought leaders brought a wealth of experience and perspectives to this opening day, and it has been a valuable “well organised event” for delegates, according to Mr Sami Ayoub, Deputy-CEO of Tunisie Telecom.
The main messages taken from today included the benefits and challenges for 3G services in North Africa – with some countries facing the prospect of no 3G at all in the case of Algeria. Furthermore, the need to accommodate for increasing numbers of subscribers and to understand user behaviour. Finally, a key message has been that operators need to keep adapting in this dynamic region, leading service providers like Djezzy may have a huge market share for now, but operators need to ensure that they do not focus solely on voice services. As Mr Fakharany from Google said “operators with big market share in voice – but if there are no 3G services – this is dangerous for the future.”
The high level of the talks in the conference encouraged lively debate among the congress participants, who were networking enthusiastically in between sessions. Despite budget restrictions among the region's companies, executives from over 20 countries travelled to the event, representing a broad picture of the telecommunications sector: leading operators, alternative service providers, regulators and government bodies, industry associations, and providers of a range of solutions for telecommunications operators (from infrastructure to co-location solutions, power, CRM and more).
The second day of the event will include even more presentations and debate from leading regional figures, including; Hatem Dowidar, CEO, Vodafone Egypt, Hassan Kabbani, CEO, Mobinil Egypt, Charles-Henri Levaillant, Corporate VP, Strategy & Development, Vivendi Group (share holders of Maroc Telecom), Mr Cherif Yaici, Director of Business Strategy, Algerie Telecom Group, Mohammed Bouhelal, Chief Corporate Affairs Officer, Canar Telecom Sudan, Marwan Hayek, VP Technologies, Mobinil Egypt, and more!
The second day of the event opens at 9 at the JW Marriott. Don't miss it if you're in Cairo.

Five questions to Bob Fonow, international telecoms consultant and emerging telecoms market specialist

I am currently spending most of my time on the next Eurasia Com congress (Istanbul, 23-24 March 2010), researching the market and building the conference programme. As part of my research I have turned to some of the region’s experts for insights and ideas. One of them is Bob Fonow, Managing Director of RGI Ltd, an operations turnaround specialist, general manager and cross-cultural management consultant to corporations and governments worldwide. I first met Bob at the launch South East Asia Com event in Malaysia last year. As the region’s market was relatively new to me, he gave me a great insight into its telecoms opportunities and business practices. Since then, he has attended several events in the Com World Series, bringing his expertise and leading very interesting debates with the speakers and other participants. He will chair the opening keynote at the next Eurasia Com congress. I took this opportunity to ask him 5 questions about the region’s market.

What are the key trends in Eurasia’s telecommunications market today?
“Central Eurasia is at the beginning of a great change in telecommunications geopolitics. Up to now international telecommunications has been primarily an issue of several putative global carriers such as ATT in the United States, BT and Deutsche Telekom in Europe, NTT/KDD in Japan and to a lesser extent Singapore Telecom. Overlaying these massive fiber installations are several mobile conglomerates such as Vodafone, Zain and in future perhaps China Mobile.
The new world of telecommunications may look much different than it does today. The existing international carriers are run by smart people, who will be able to keep significant market shares in an expanding global market. However Russia and Turkey are well placed to take leading positions in international networking and Internet development.
There can be little doubt that the 21st Century is the Eurasian century and Russia and Turkey at the geographic fulcrum of this trend, perfectly positioned in the Eurasian land mass. Russia is the northern bridge between China, Asia and Europe. Turkey is the land bridge between both Europe and the upper Middle East and CIS, and the most important land route from Africa into both Russia and northern Asia.
Currently almost all of the large international fiber routes follow the circumference of the middle oceans from the Atlantic, through the Mediterranean to the Indian ocean and Malaccan Straights, and back across the Pacific. There is still very little connectivity across the northern or middle Eurasian land mass. As Turkey and Russia add capacity or leading capacity consortia, the relative power and influence of several carrier networks will change. Turkish, Russian, Iranian and CIS carriers may be the biggest beneficiaries.”

What are the key markets to watch and why?
“Turkey seems the most vibrant and exciting to me. Young people in Turkey seem to be excited by the Internet and mobile applications in a way reminiscent of China and Japan, rather than the US and Europe.
Russia is always interesting. But the country has an extremely complex regulatory regime that makes it difficult for competitors to build networks quickly for the revenues needed to sustain start up and growing businesses. Cronyism remains a problem.
Cyprus and Azerbaijan are smaller markets, but there is intense interest in telecoms development in the countries.”

How is the global economic situation affecting Eurasia’s telecoms sector, and how are companies responding to it?
“The large carriers have the revenues and regulatory advantages to sustain themselves during the recession. Smaller carriers and start ups, for example wireless broadband and WiMAX start ups, are experiencing difficulties raising capital from private equity markets and banks.
The companies with financial strength were in a good position earlier this year to acquire assets cheaply. But values are increasing again.
How are companies responding in the recession? Almost every company today uses the same technology service platforms. The key to success is clever marketing and sales, customer support and cost controls, and making sure you have the right people in the right positions. Of course, that’s the key to success anytime! Good management usually survives and eventually wins.”

Which services or technologies are likely to have the biggest impact on the market in the years to come?
“In the medium term, HSPA and LTE will expand broadband mobility in urban areas with dense populations. WiMAX is likely to find a niche in smaller towns and villages, and in specific applications in urban environments. Wealthier neighbourhoods in cities will see more fiber to the home.
The big question is what is going to come out of China? Huge numbers of developers are at work on mobile applications and social networking. Today it’s still aimed at the China domestic market, but it is naive to believe that only the United States in social networking or Scandinavia and Korea in mobile will lead global innovation in the future.”

How important is the Eurasia Com congress for the region’s telecoms industry and what do you expect to take out of the event?
“Last year I was impressed by the energy of the conference, especially the breakout sessions on new applications by start up companies, and the presentations from medium sized countries like Tajikistan. The morning on Turk Telecom and Turkcell had comprehensive presentations that illuminated the importance of Turkey in telecommunications geopolitics. Overall it was an excellent blend of technology and business.
This year I am limiting myself to two conferences. This is the one I wouldn’t miss.”

If you are i terested in joining Bob at Eurasia Com by becoming a speaker, I am currently confirming the programme, so don’t hesitate to contact me for more information.

Africa still very much the centrepoint of M&A activity

The failure of the MTN-Bharti was only annouced a couple of weeks ago, but the South African group is not wasting time to move on: rumours say that it is looking towards its rival Zain. Zain group caught the eye of a number of potential investors recently (including Vivendi, which is now turning to Latin America for expansion), and is now the object of interest from an India-based consortium which includes no other than Bharti. So, will the previous friends become rivals in a bid for a stake in Zain? If MTN does get a interest in the group, will it not create competition issues in the many African countries where both groups have strong operations?
On another front, Indian operator MTNL is trying to build its position in Africa too. According to my colleagues at Global Mobile Daily, MTNL'schairman, R.S.P. Sinha, "told local press that his company had expressed interest in buying state-owned Zambian operator Zamtel and had already signed a nondisclosure agreement with the operator". The interest of several Indian operators in Africa makes sense. They are renowned for running low-cost operations for low revenue markets, which would suit the continent.
With these never-ending M&A talks, it looks like the face of Africa's telecoms is shifting. New players are about to make a strong impression, not just from the investment side, but also from the vendor side. As relations between operators and their suppliers are changing to become more partnership-based, large vendors may take a more important position on the market. And although Ericsson is still the major player in Africa, it seems that the Chinese vendors are keen to grow their presence (they certainly made their mark at last week's ITU summit, benefiting from the absence of the major European and American companies).

Big ideas for world telecoms but not much excitment at ITU in Geneva

It’s day three at the ITU summit in Geneva and this year’s event has its ups and downs. While the exhibition is rather small and quiet (with some big industry names shining by their absence), the Forum is well attended and generating the expected mix of self-congratulation, wishful thinking, big ideas and complaints about the missing/misdirected regulation, investment, technology developments etc.
The big talk of today was climate change, and its impact on the telecoms industry. On the one hand, operators and vendors need to work on more eco-friendly ways of running networks, while on the other hand telecoms technologies can help reduce carbon emissions. Emerging markets have a different position on the issue from developed economies. Poorer parts of the globe are the main victims of climate change, without enjoying the benefits of what caused it, as was reminded by the Vice-President of Sierra Leone. But on the other hand, emerging markets are where some of the most innovative ecological solutions are tried, not for their green credentials but because they are cheaper to build and run (solar power for base stations has been pioneered in Africa and India for instance).
Talking of emerging markets, the infamous digital divide is still a big discussion point, particularly in what concerns broadband access. The ITU’s Telecommunications Development Bureau released new statistics that showed that while mobile access is growing hugely in emerging countries (now overtaking subscription numbers of developed countries), broadband access is severely hindered by costs. The average monthly cost for broadband access in the developing world is ten times higher than in developed countries, and represents 300% of monthly gross national income compared to just 2% in the developed world. With such shocking statistics, it’s no wonder the ‘Broadband for All’ session was so well attended today, with people standing at the back of an overheated room. The debate went over the usual challenges unfortunately without providing any new solution: lack of backbone in emerging countries, inadequacies of universal service provisions, lack of funding, insufficient initiatives from the major players, and of course the state of the global economy putting projects on hold.
Other topics of discussions included the evolution of the telecoms ecosystem and business models within it. In particular, the relations between vendors and operators, and between vendors themselves, are changing. From a position of client/supplier or competitor, many major players are developing partnerships, or calling for more to be developed. For example, Paul Excell (Chief Operating Officer – Innovation at BT) called today for a global open ecosystem for innovation for instance.
I haven’t heard a lot of mentions of the economy, but I'm hearing some reassuring 'feelgood' phrases such as "let's be proud to be in this industry" (courtesy of Stephan Scholtz, CTO of Nokia Siemens Networks), the kind of phrases we heard at Mobile World Congress earlier this year and I remember hearing when I first started in telecoms in 2001.
Thankfully, the mood about our forthcoming AfricaCom event is rather upbeat, and I’m expecting a livelier mood among the audience.

Hope for broadband access in Central Africa

I wasn’t able to make it to the opening day of the ITU summit in Geneva, but I am keeping an eye on the various press releases sent so far before visiting the event tomorrow.
The main one attracting my attention is the announcement by the World Bank of its endorsement of the $215 million, ten-year Central African Backbone Program (CAB Program). According to the release, “this program will support the countries of the Central African region in developing their high-speed telecommunications backbone infrastructure to increase the availability of high-speed Internet and reduce end-user prices. The CAB Program will also help countries harmonize the laws and regulations that govern the ICT sector to increase private sector investment and improve competition.” The programme is supported in its initial phase by 3 Central African countries (Cameroon, Chad and Central African Republic - CAR) and will be followed by another eight countries - the Republic of Congo, Equatorial Guinea, the Democratic Republic of Congo, Gabon, Niger, Nigeria, São Tomé and Principe, and Sudan.
Central Africa includes some of Africa’s least developed telecoms markets. The landlocked countries in particular are experiencing difficulties in benefiting from the various submarine cable projects being launched, connecting West and East Africa to the rest of the world. Hopefully the CAB programme will support Central African telecoms markets and help them develop broadband services, a key factor in the region’s economic development.
This will continue to be a major topic of discussion at the African events in the Com World Series, with AfricaCom coming up in Cape Town next month, and the sub-regional events in 2010: East Africa Com in Kenya in April, West & Central Africa Com in Senegal in June, and the new Nigeria Com in Lagos in September.

Turkey's telecoms market looking towards Western Europe

I am Istanbul to meet key operators and vendors ahead of our Eurasia Com event in the city in March, and it is interesting to have a first-hand view of the Turkish market.
One thing that I found particularly striking over the last couple of days is the prominence of Turkcell as the major telecom brand in Turkey. This position is usually held by the fixed-line incumbent and its mobile arm, particularly in recently liberalised markets (Turkey only liberalised in 2005). Here, Türk Telekom does own close to 100% of the fixed voice market, but its mobile subsidiary Avea is largely distanced by Turkcell, who leads the market in many ways: number one mobile operator in terms of subscriptions, mobile broadband leader (the operator launched HSPA at the same time as its 3G network earlier this year), and an omnipresent brand. Its strategy of targeting high-end segments has certainly paid off, as it is now seen as the high quality operator in the market.
Another thing I realised through the conversations I’ve had is how far Turkey has come as a telecoms market in the last few years. In just a few years of competition, the regulator and operators have wasted no time to catch up with developed markets, to the extent that Turkish companies now benchmark themselves against Western European markets rather than closer ones such as Eastern Europe. Here are a just a few areas to watch in Turkey’s maturing market:
- MVNOs: regulation should be effective in 2010 but in the meantime “pre-MVNOs” (most successfully football club brands) are already in place on a simpler reseller model, where the host operator still owns the SIM and the customers ; from next year, a fuller MVNO model should attract other types of brands such as retailers; mobile operators are gearing up for this new market, and SIM card vendors and MVNEs should also benefit from new opportunities;
- Convergence, with triple play and potentially quadplay offerings: Turkcell with the acquisition of ISP Superonline among other moves, Türk Telekom with fixed and wireless offerings and the potential launch of IPTV next year;
- New strategies to deal with increased competition: operators are expressing a strong interest in new ways of serving their customers with segmentation strategies and lifestyle offerings;
- Managed services in the ICT sector: as already done by alternative operators Koç.net and Superonline, Türk Telekom is looking into moving its wholesale strategy towards managed services to better serve its corporate clients.
Next year’s Eurasia Com event will include a special focus day on Turkey. The draft agenda will be published this week, to be followed by a call for speakers.