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The Egyptian telecom field is witnessing a lot of groundbreaking events, as the competition is fierce among mobile service providers, reaching what could be called ‘price wars’. Although the Egyptian mobile market is achieving one of the highest growth levels in the world, it is facing the challenge of reaching saturation, which will force the companies to find new alternatives for expansion and growth. Amidst all these circumstances and challenges, Etisalat is in the center of the picture, not only as one of the mobile service providers, nor as a main player in the market, but as the company that caused – upon its launch – a huge revolution in the mobile services and prices, reshaping its features. In our interview with Eng. Saleh Al Abdooli, CEO of Etisalat Misr, we discuss the important and hot topics that impose themselves on the Telecom market. Among them is the competition, the development the market is witnessing, the future expected growth rates, and we answer the million dollar question... Where is the mobile market going? The interview also includes Etisalat’s role in the mobile market, the introduction of new services and offers, where the company stands concerning the Way Max, 4G, and the second land line license, if offered.
“We reached the 10 million subscriber benchmark in record time”
The Egyptian mobile market has witnessed lately unprecedented competition that reached a “price war” between companies. How do you see the market? And were you ready for this level of fierce competition?
Yes the mobile market is witnessing competition that is in everyone’s benefit, primarily the consumer – benefiting from the fair competition which offers him the best services at the most convenient prices, which is what Etisalat is committed to. We support fair competition that is in the consumer’s benefit. We are leading the market within competition, with our continuous services and offers since the company started its operations in Egypt. We prove that we did not enter the Egyptian market to merely compete, but to revolutionize. Over the last two and a half years, Etisalat was committed to providing the best services to its subscribers with the most convenient prices, and in all our services and offers, we committed to the essential principle of providing the highest added value to subscribers.
The fierce market competition during the holy month of Ramadan with special offers to subscribers to get the largest number of new subscribers... What benefit did you get from it?
We added a lot of new customers during Ramadan, but more importantly we gained the subscribers' trust and maintained the credibility we gained since we started operating in Egypt through our services and products that are always straightforward and transparent with the subscribers, without any deceiving conditions or hidden costs. As a result, customers gave us their full trust and we have achieved growth levels in customer base that were never preceded in the Egyptian mobile service provision history.
What are Etisalat's strength points that the company counts on in competition with the other operators?
Etisalat has a lot of strength points that it depends on, among them is that it is the only network that was constructed from the beginning with 3G technology integration, and it also is the only provider that owns an international gateway for communications, as well as both mobile and land line internet. All of this enabled Etisalat to take the initiative of providing unprecedented services like 3G technology in mobiles, high-speed internet, video calls, mobile TV, and other services that Etisalat introduced. Those services also enabled Etisalat to provide some services for the first time in Egypt, like “ro’ya” which the company introduced to serve an important segment of subscribers that were never addressed before (the hearing impaired and those with the inability to speak), in addition to the “collect call” which introduced the option for the receiver to pay the local call upon their consent.
And how does the “ro’ya” tariff help sign language users in communication?
This tariff that Etisalat introduced for the first time in Egypt aims at using modern technology to provide a suitable service to this important segment in the community. Video calls are offered at a low price with no extra cost. The rate is 20 P.T. (less than 0.04 USD/min.) upon calling an Etisalat number, the SMS costs 30 P.T. (less than 0.06 USD/min), and the operating cost of the line is L.E. 10 (less than 2 USD) paid only once upon operating. Also for the first time in Egypt and the Middle East, the users can also get technical support from our video customer service center, which was equipped with sign language professionals to provide technical support using picture illustrations. The number for this video service is 333. I would also like to clarify that, as a company, we were eager to provide such a service as a corporate social responsibility initiative, and we are committed to look after all community segments and provide them with special services like we do in sports sponsorships, as we fully sponsor the Egyptian Paralympics committee including teams that won world tournaments and were recognized from top authorities for the Olympic medals they won for Egypt.
What is Etisalat’s current subscriber base? And what is the company’s market share?
Etisalat’s market share is currently approximately 16% of Egypt’s mobile market, as our subscriber base reached 10 million – a figure that exceeded plans, thus we have altered our expectations to 15 million subscribers in the first 3 years instead of 10 million.
And did the global financial crisis affect the company’s plans or growth rates and expansions?
The global financial crisis did not strongly affect the company’s plans or growth rates and expansions. Although we set alternative scenarios to deal with the crisis depending on its impact, we did not revert to any of these scenarios and we did not change our normal plans because we did not find a need for this. It can be said that the crisis impact on Etisalat's roaming revenues did not exceed 10-15% of the roaming and international calls revenues due to the fall in the number of tourists.
And what was the crisis impact on the revenues of international calls during Ummrah?
It did not affect the revenues of international calls during Ummrah by any more than 5%. When Etisalat started working in the Egyptian market, everybody was questioning its ability to operate against 2 other well-established competitors in a market approaching saturation. Nevertheless, Etisalat was able to become a major and strong player in the market, yet leading in an important time of its development. What is the secret behind such achievements in such a short time? We can say that Etisalat has become the “smart” choice for subscribers through providing services and offers in a distinguished manner, for we operate around the consumers in each service and every offer we introduce, to benefit them with the most added value. The company insists on providing all types of services at the most convenient prices through simple and straightforward offers with no complications or hidden conditions, hence we achieved these high growth rates, which describes the consumers’ trust is Etisalat. Besides all of the above, Etisalat was able to complete building its state of- the-art network built by the latest international mobile technology, and it completed all its commitments in a record time, as we achieved in 2 years what was planned to be achieved in 5 years.
“Etisalat... Now is the time”, the new slogan the company used in its marketing campaigns lately, what does it mean?
It is not only a slogan, but a true fact that means that the subscriber really feels that now is the time to join Etisalat, where 98% of Egypt's inhabited areas are covered by its network, and only a few remote areas remain. The company also provides integrated special mobile and internet services to its customers, at a high quality and competitive prices that suit all segments. It also provides offers that are clear and very credible to the subscriber, which makes Etisalat the “smart” choice to the customer who is provided with high quality services and convenient price. In addition to this, we insisted on providing superior customer service. All this is integrated in one organization that makes subscribers feel that now is truly Etisalat’s time.
Where is the Egyptian mobile market heading? And is it going to achieve last year’s high growth rates this year? Or has it reached the saturation stage?
The mobile market is going to maintain in 2010 the same high growth levels, after this the rate may fall, approaching saturation level in 2011 and 2012. At this time, the mobile market growth will become vertical not horizontal – meaning the growth will be in the services and its revenues, not in the number of subscribers.
And does approaching saturation level represent a challenge to the operators?
Yes and we are fully prepared for this and have competition strategies after the market reaches the saturation point. We will be focusing on growth and expansion of services, and we already have previous experiences in a lot of markets where Etisalat is currently operating such as the Emirates, where mobile phone subscribers total is more than 150% of the population.
Expanding in new services highly depends on the success of 3G technology. What is your vision to the extent of success of this service? And what is the percentage of its users?
3G technology has been satisfactorily successful at a 10% percent usage rate – equivalent to one million users, and the market will witness higher growth as more applications are made available to consumers.
WIMAX and LTE technologies have become serious issues imposing themselves on international telecommunications companies. Are you willing to get the licenses for and invest in these fields?
LTE technology represents a development to the current technologies like 3G and HSPA+ and I believe that investing in this technology is the ideal way for mobile companies. From our side, we are well prepared to every development and we carry out experiments, and provide continuous courses to our engineers on those new technologies like HSPA+ and LTE, as they are the right path to mobile service development and 3G application, allowing for higher speeds and better efficiency of data transfer. Providing LTE technology does not require a license because it is an upgrade of the 3G technology. WIMAX wireless technology, on the other hand, did not prove its success on a large scale.
How many employees are working in Etisalat at the moment?
We exceeded 2000 direct employees at the moment, in addition to indirect employees.
What acquisitions have Etisalat undertaken in the high speed internet services? And is the news of a new acquisition by the company in the same field true?
Last October, Etisalat acquired Nile Online and EGY Net – a company that owns two other companies, SofiCom and Internet Egypt. Etisalat then restructured them to maximize the benefit from them. These 4 companies together control 70% of the corporate segment, and the development plan and reorganization aim at increasing this figure. These acquisitions were publicized last October, and there are no new planned acquisitions in this field as there is no need for it.
Will the company apply for the second landline license if it was re-offered?
Our position from this bid will be determined based on the conditions that will be included in the tender document.
