By Ronan Shields
Recent CommsMEA lifetime achievement winner Zain CEO Dr Saad Al Barrak on the firm's regional aspirations.
Be First, Be Daring, Be Different". That's the motto that has guided Zain from its comparatively humble beginnings as a small regional player to a major contender on the international stage.
In the course of five years, Zain has expanded from a one-country operator to a cellular network giant whose geographic coverage spans the Middle East and Africa.
You have two choices as a human being: to be a subject of history or a maker of history. As a company we have chosen to belong to the second category.
Today Zain ranks as the fourth largest mobile operator in terms of geographic coverage (21 countries) and boasts a subscriber base exceeding 32 million.
Zain's capitalisation has multiplied more than 10 times since Al Barrak's appointment exceeding US$28 billion, as of August 2007, with revenues reaching $4167 billion and profits of $1051 billion by the end of 2006, a five-fold increase since 2003. The company is on track to achieve a 30% rise in profit this year compared to last.
"You have two choices as a human being: to be a subject of history or a maker of history. We have chosen to belong to the second category," states Al Barrak.
He attributes the company's impressive growth to the efforts of its entire management team. He says 2007 has been a landmark year in the company's history, particularly given the recent revelation that Zain will relocate the headquarters of its international operations unit to Bahrain.
Zain expects to complete this process by May 2008 with sources citing a restriction on investment as its main motivation.
"In Kuwait, certain parties tried to dramatise things and turn it into a national issue of companies leaving the country but that is not the case, if you look at our overall strategy it should put things back into perspective," declares Al Barrak.
He backs this argument by referencing Qtel's takeover of Kuwait's second mobile operator Wataniya. Al Barrak claims this move effectively meant that Wataniya's headquarters were now located in Doha.
Another significant development to take place this year was the company's decision to rebrand under the Zain banner.
"Zain brings together all our operations under a single, strong and unique identity. It will propel the group towards becoming one of the top ten global mobile telecommunications companies in the next four years," asserts Al Barrak.
MTC-Vodafone operations in Kuwait and Bahrain, Fastlink in Jordan, and Mobitel in Sudan have been rebranded Zain.
The company also plans to rebrand its Iraqi division, MTC Atheer, to Zain in the near future. In addition the group will launch operations under the Zain brand in Saudi Arabia early next year.
He also notes that the company's ambition of becoming the first global Arabic teleco is far from achieved.
"By 2011, we hope to achieve a $6 billion EBITDA and 70 million customers," he says.
"We now have a stake in what are easily the two largest Arab markets and both acquisitions were significant milestones in the implementation of our ACE strategy."
The company has spent in excess of $7 billion on acquisitions this year alone for concessions in Iraq and Saudi Arabia. However, this has led to a degree of confusion as to the source of the financing of the company's recent expansion drive.
"There is no specific loan to finance the Saudi Arabia deal; we have our conventional $4 billion facility plus additional Islamic financing facilities. Both our acquisitions this year have been resourced from our already declared facilities," says Al Barrak.
Al Barrak also reveals that Zain hopes to fund its massive investment in Saudi Arabia by raising $1.5 billion after its mandatory IPO, although he says that a decision as to when this might occur hinges on the country's telecommunications authorities.
Al Barrak notes that Zain's position as Iraq's leading mobile operator, with a subscriber base of 3.7 million, can largely be attributed to the company's massive early investment in the market.
"Inside the next two years, we hope to have six million customers in Iraq, this will require another $500 million worth of investment," he says.
Despite such massive investments in the region, Al Barrak says the company is not seriously considering acquisitions further afield at this point in time.
"Ideally we'd like to be in every UN country but at the moment we are focused on the Middle East, Africa and Asia. You can't be a true international brand unless you have a dominant presence in your nearest regional markets," he concludes.
Middle East Mobile Operator of the Year - Nawras
Omani network operator Nawras has rapidly expanded its share of the country's cellular market, through a combination of affordable tariff packages and extensive network coverage.
Omani mobile phone penetration has increased tremendously from 32% in March 2005 to around 70% today, adding about one million customers.
The majority of this penetration increase has been attributed to Nawras' presence in the market, where a constant monthly market share in excess of 50% has contributed to an overall market share of around 40%.
This development of market share is among the fastest recorded by a second cellular network operator within the Middle East region.
Nawras' success can largely be attributed to its adoption of a customer-centric approach, in which it delivers affordable high quality services supported by a world-class network, which is benchmarked by Ericsson to be amongst the top 10 in 110 Ericsson GSM networks worldwide.
As of June 2007, Nawras had reached 92% of Oman's population and 96% with National Roaming.
Of the company's almost 500 employees, approximately 80% are Omanis, the majority of whom had no previous experience working in the telecommunications sector.
Today, Nawras has already reached the Omanisation goal set by the government.
Nawras' dedication to the development of the Omani economy is also manifested through an active Corporate Social Responsibility programme. Nawras has benefited thousands of Omanis with Nawras Goodwill Journeys during Ramadan and has contributed considerably to the Omani society through a range of sponsorship programmes. In the aftermath of cyclone Gonu, Nawras provided its customers with free calls to a value of OMR 2 in order to enable every affected customer to be in touch with family, friends and colleagues.
Runners-up:Inmarsat, MTC Atheer, MTC Bahrain
African Operator of the Year: MTN
With a subscriber base totalling 44.3 million, the South African-based pan-African operator recorded an 11% quarter-on-quarter hike in subscriber numbers in the three months to March 2007.
"I am pleased with the subscriber growth that we have recorded in the first quarter of this year, which is in line with our expectations," says Phuthuma Nhleko MTN Group president and CEO.
MTN's combined Middle East and North African operations registered 28% growth in subscriber numbers during the quarter with MTN's Sudanese and Afghanistan operations growing 11% and 62%. Afghanistan counted 354,000 subscribers at the end of March.
One of the company's notable highlights over the past 12 months has been the launch of Irancell in late October 2006, where the operator was able garner close to a million mobile subscribers during 1Q07.
The company's operations in the West and Central Africa region grew 10% during the quarter while MTN Nigeria subscriber numbers grew 9% to reach 13.38 million.
Meanwhile, its Ghanaian customer base grew by 13% to reach 2.92 million. Subscriber numbers in Cote D'Ivoire reached 1.98 million, representing a base increase of 22% for the quarter.
In Uganda, ARPU stood at $16 for the quarter, with the operator achieving double-digit subscriber growth of 10% to reach 1.76 million customers by the end of March.
In its domestic market MTN saw its subscriber base grow 4% during the quarter to reach 13.03 million.
Overall Operator of the Year - Zain
Many analysts claim the company's colossal investment of more than US$6 billion in Saudi Arabia, rebranding to Zain as well as relocating its international headquarters to Bahrain are merely signs of things to come from the Kuwaiti company.
"Zain will bring together all our operations under a single, strong and unique identity. We believe it is the optimal platform upon which we can build a global brand," says Zain CEO Saad Al Barrak.
Country operations in Kuwait and Bahrain (both formerly MTC-Vodafone), Jordan (previously known as Fastlink), and Sudan (earlier Mobitel), have adopted the Zain brand. The company's operations in Iraq and Saudi Arabia will reportedly soon follow.
With a customer base of 32 million stretching across 21 countries in the MEA region, Zain's capitalisation has multiplied more than 10 times since 2002 and exceeds $28 billion, as of August 2007, with revenues reaching $4.167 billion and profits of $1,051 billion as of the end of 2006, representing a five-fold increase since 2003.
Company officials report that Zain's 2007 finances are on track to show a 30% year-on-year increase despite spending more than $7 billion alone on licence acquisitions this year.
Al Barrak proclaims 2007 as a "pivotal" period in the company's history and development as it cemented its presence in the Iraqi market where it paid $1.25 billion for a 15-year mobile concession.
At present, the company is preparing for an initial public offering on the Saudi Arabian stock exchange to raise $1.5 billion as part of its commitments to corporate social responsibility as stipulated by its licence.
Zain has launched a similar initiative in Kuwait where it appointed a CSR officer who reports directly to the chief executive. The company's expansion is far from over with Al Barrak promising a fresh wave of acquisitions.
Customer Service Provider of the Year - Roshan (Afghanistan)
Telecom Development Company Afghanistan, leading the market under the Roshan brand launched its network operations in the war-torn country in July 2003.
For Roshan, introducing the concept of the customer care centre has been and continues to be a fundamental core operating principle.
Establishing a call centre would normally represent a relatively simple task, but in Afghanistan, cultural sensitivities, geographical challenges and a lack of infrastructure combined to create a number of issues for the Roshan team.
Despite this, the company's nationwide call centre based in Kabul boasts more than 130 customer care seats handling more than 35,000 calls per day, ranging from service education, activations, trouble shooting and customer inquiry resolution.
The centre supports Dari, Pashto and English languages and boasts a triple-figure workforce, 25% of whom are women.
This broke new ground in a country in which speaking to a female stranger represents a serious cultural taboo.
Roshan is committed to promoting women's rights in the workplace and as a result, the customer care centre is one of the few places that women can work in the country. In Afghanistan, the illiteracy rate exceeds 70% of the adult population, which is why voice-based customer care services are critical because SMS messages sent to the masses can trigger a huge number of customer enquiries. With a customer base of just 1.4 million, the customer care centre logs a remarkable one million calls each month.
Roshan monitors the performance of the centre through quarterly customer satisfaction surveys, as well as a set of its own internal Key Performance Indicators (KPIs). The company has invested more than $300 million in establishing its network and customer care centre. Today, the company employs 800 staff directly and more than 20,000 indirectly across Afghanistan. Roshan also enacts a comprehensive series of corporate social responsibility programmes and initiatives and is deeply committed to Afghanistan's reconstruction and socio-economic development.
The company ultimately hopes to have the centre internationally certified so it can outsource its services to serve as a collection centre, both as a commercial venture and an extension of reinvestment in the community.
Telecoms Deal of the Year - Qtel acquisition of Wataniya Telecom
Qatar Telecom's (Qtel) acquisition of Kuwait's National Mobile Telecommunications Company KSC (Wataniya) represented one of the most ambitious takeover bids in the entire history of the Middle East telecommunications industry.
The $3.7 billion deal saw Qtel expand its presence overnight to include operations in 11 countries, with a total controlled customer base of nearly 12 million and total customer base of 32 million.
Wataniya is one of the leading MENA telecom operators with mobile operations in seven countries in the region.
Wataniya in Kuwait boasts more than one million customers and is considered one of the more advanced network operators in the region, with strong ongoing revenues being generated from an array of innovative services including pushmail and paging services.
Tunisiana, a joint venture company Wataniya operates with Orascom, boasts more than three million customers, equating to 48% market share in Tunisia, up from 45% last year.
Nedjma in Algeria, owned 71% by Wataniya, also has more than three million subscribers and an increasing market share. The mobile market in Algeria has substantial growth potential remaining, with current penetration at just over 50%.
Other operations within the Wataniya group include an iDEN, push-to-talk business in Saudi Arabia, a 49% shareholding in Asiacell Iraq, a mobile start up in Palestine and an active mobile operation in the Maldives.
Commenting on the investment, His Excellency Sheikh Abdullah bin Mohammed bin Saud Al Thani, Chairman of Qtel described the takeover deal as "undoubtedly the most significant in the region and totally changes the face of mobile telecommunications in this part of the world".
"[The Wataniya deal represents] yet another critically important move in [Qtel's] aim to be among the top 20 telecommunications companies in the world by 2020. The markets we are entering with this investment are ones with which we are culturally familiar but more importantly, where we can bring our expertise to bring real growth opportunities. We look forward to concluding this transaction and developing our plan for the business."
Runners-up:Zain securing third Saudi Arabian mobile network licence, STC acquisition of Malaysia's Maxis Communications
ISP of the Year - Batelco
Batelco is Bahrain's incumbent telecommunications operator and offers a wide portfolio of services including dialup internet (launched in November 1995) and broadband services based on ADSL technology (launched in May 2001).
By the end of 2004, Batelco decided that organic growth of broadband customers in specific and internet customers in general was not enough to match future plans of making Bahrain the "Intelligent Kingdom", which was driven by major government initiatives such as the e-government and King Hamad Future Schools projects.
As a result, Batelco launched an ambitious plan under the auspices of BroadBand Bahrain (BBB), which aimed to connect every home in the country to broadband internet service before the end of 2008.
Batelco moved to establish a next generation network at a cost of $57 million, which would enable reliable broadband services and establish a base for offering future triple play services (Internet, voice and video).
The company also lobbied the country's Telecommunications Regulation Authority (TRA) to allow it to offer affordable broadband services to consumers. The result was the BD10 package, which was designed to provide home internet users with access to discount broadband services.
The deal proved a huge success, with national consumer broadband subscription rates almost doubling in the first six months. To date, the package has attracted 31,000 subscribers.
Bahrain now leads the region in terms of ADSL penetration, while the number of consumer broadband subscribers in the country is over 55,000.
Given the popularity of broadband services among consumers in Bahrain, Batelco is currently planning its roll out of double play (Internet and Voice) and triple play (Internet, Voice and Video) services.
Batelco is also working hard to replicate this success in the country's enterprise market. In June 2007, it launched a new programme for the business sector under the banner Business Benefits.
The first ‘benefit' announced to the market was a series of prices reductions of up to 50% on existing broadband business packages and the launch of a BD10-like low-cost access package for business subscribers. Batelco reports the initiative has proven a major success to date.
New Telecoms Service of the Year - One Network, Celtel International
MTC Group subsidiary Celtel operates in 14 countries in Africa and is the most successful pan-African mobile network, offering telecommunications services to more people in Africa than any other network. The company is one of the best-known branded businesses in Africa with mobile licenses covering more than 400 million people.
MTC through Celtel has invested more than $10 billion in Africa in less than three years and continuously introduces new products and services which are relevant to the needs of people of the continent. In September 2006, Celtel introduced One Network, the world's first borderless mobile phone network.
This year Celtel expanded One Network to provide services to 160 million people (approximately 20% of Africa's population) in six countries: Kenya, Tanzania, Uganda, Democratic Republic of Congo, the Republic of Congo and Gabon. The One Network service allows all pre-paid and post-paid customers in these six countries to be treated as local customers n terms of pricing, while retaining their home network service functionalities when they visit any of the other five countries in which the service is provided.
Key features of the One Network service include zero roaming surcharges when Celtel customers are travelling outside their home country.
Customers can make calls and send SMS message at local rates, receive incoming calls free-of-charge, top up with scratch cards brought from their home country, and purchase top-up cards from more that 160,000 points of sales in One Network countries.
They are also provided full access to home network services (including voicemail, GPRS/EDGE high speed internet access and Blackberry e-mail services) no matter which One Network country they are in.
Should they need assistance, calls to Customer Care (via home network short codes) are free of charge and are routed to their home network call centre where they can speak to a service representative in their native language. MTC makes it easy for customers - there is no registration, there are no extra fees, no roaming or international access deposit, no complicated dialling formats, and no need to remember to change tariffs before travelling.
Ultimately, MTC aims to expand One Network coverage to include all its operations in Africa.
Runners-up:Etisalat UAE Mobile TV, Inmarsat handheld IsatPhone, Batelco BD10 broadband internet
Most Innovative Non-Voice Service - BGAN, Inmarsat
Inmarsat, the world's leading provider of mobile satellite communications, has invested in research and development to provide its customers with advanced data services. In 2006, Inmarsat launched its latest service, Broadband Global Area Network (BGAN), making innovative headway in the data service sector.
BGAN data services enable users to access their corporate network via a secure VPN connection, use email and other office applications, browse the internet and send large file attachments at speeds of up to 432 kb/s. The technology supports streaming applications for live video or video conferencing at guaranteed data rates of 32, 64, 128, or 256 kbit/s, in addition to ISDN. BGAN services are available to 98% of the world's population, making it virtually global.
BGAN is accessible via a range of small terminals that have been designed for maximum portability. BGAN terminals are lightweight, compact and can be carried as easily as a laptop. Terminals can be connected quickly and easily to a laptop or multiple laptops via wired or wireless connections, including Bluetooth or Wi-Fi. The same device can be used worldwide and the user interface is standard across all terminals. Five terminals have been developed, offering a variety of performance options to suit various operational needs.
Over the last few years, Inmarsat has seen its proportion of revenues derived from data services consistently increase as a proportion of the total, growing at double digits year-on-year. The BGAN service is a prime example of how Inmarsat's services are being embraced for their data capabilities.
Since its launch, BGAN has generated great interest among customers in the Middle East and Africa and been taken up by a number of heavy users, particularly major corporations and media agencies, including the BBC, Al Jazeera and CNN.
CNN reporters used BGAN to report live from Lebanon during the summer 2006 war. As a show of confidence in BGAN's service, CNN nominated Inmarsat for 2007's IBC Technology Innovation Award, which is one of the most respected awards in the broadcast technology sector. Today, there are more than 11,000 active BGAN subscribers registered on the Inmarsat network.
Runners-up:Batelco ‘MMS the World' service, MTC Touch ‘Credit Transfer' service, Etisalat ‘Greetune' service, Wateen Telecom WiMAX service
Telecoms Technology Investment of the Year - WiMAX, Mena Telecom
Bahrain telecommunications service provider Mena Telecom in conjunction with technology partner Motorola is jostling with rival telco MTC to roll out the country's first WiMAX services before the end of 2007.
Motorola will plan, deploy and manage the wireless network in Bahrain on behalf of Mena Telecom, in addition to supplying 802.16e-based technology.
"Given the infrastructure MTC already has in place, we expect the operator to introduce WiMAX into the market first," conceded Abdulhakeem Al Khayyat, chairman of Mena Telecom and general manager of Kuwait Finance House. "But the time difference between their launch and ours will only be a couple of months at most, and we will enter the market with an offering that has never before been seen here."
Mena Telecom, which already provides international call services as well as two-way satellite access, was awarded one of two national fixed wireless broadband licences last year at a cost of US$13 million and in the first phase of the rollout, a full range of services is expected to be made available from Manama to the Seef area. In the second phase, coverage will be extended to other areas in Bahrain by March 2008.
Rival mobile operator MTC Bahrain was awarded the other fixed wireless broadband licence.
Mena Telecom is looking to become a full service provider of voice and data, targeting the country's business and consumer markets.
Al Khayyat hopes the WiMAX network will kickstart the company's fortunes in the wider region, as the company seeks further opportunities in other markets.
"First we need to become known as a company that is interested in expansion," he said. "I believe our position in this regard would be to have a higher risk profile than other operators in the investments we make, perhaps going into markets other investors are not interested in."
With respect to opportunities in the domestic market, Al Khayyat points to the fact that there are currently 120,000 students in Bahrain alone, with technology being placed at the centre of their education.
"The ITC sector is key to the GCC region. Technology is addictive and as penetration levels increase, opportunities for the whole economy will arise," he said.
Runners-up:Fastlink Arabic ASR service, Kalimat Iraq wireless network
New Entrant of the Year - Etisalat Misr
Egypt's third mobile network operator Etisalat Misr officially launched its cellular network service on May 1. Just fifty days later, the telco revealed the service had surpassed one million subscribers, breaking the Middle East record for a start-up mobile telecoms operation.
A collaboration between UAE-based telco giant Etisalat, Egyptian National Post Office, National Bank of Egypt and Commercial International Bank, Etisalat Misr continues to post remarkable growth in the Egyptian market.
Etisalat Misr CEO Saleh Al Abdooli recently revealed that the telco expected to surpass three million subscriptions before the end of this year.
He also confirmed the telco was in negotiations to acquire an Egyptian ISP and was hugely interested in bidding for Egypt's second fixed line licence, which is currently up for grabs.
If the bid proves successful, Etisalat Misr plans to add triple play to its service offering, Al Abdooli said, also revealing that the telco is currently negotiating to establish its own international gateway which would enable it to offer international dialling services independent of Egypt Telecom.
On a technical level, Etisalat's network is one of the most advanced in the world.
In line with its commercial licence conditions, Etisalat was obliged to provide coverage to Egypt's four major commercial and tourist cities, in addition to Cairo and Alexandria.
The telco exceeded these requirements by establishing full coverage in more than 130 major cities and towns across the country, with 2G/3.5G coverage utilising 1400 rolled out cell sites (another country record).
On the international front, Etisalat successfully negotiated 120 international roaming agreements with network operators in 80 countries.
For the first time in Egypt, Etisalat Misr cellular network subscribers can experience 3.5G services, including mobile TV, video calling, and high-speed internet. Unlike those offered by its competitors, all Etisalat Misr tariffs are tax inclusive.
Runners-up:Neutel Communications - Bahrain, du - UAE