Caspian Energy (CE): Mr. Shearer, how would you evaluate the today’s mobile communications market in Azerbaijan? Which projects are the most demanded on this market?

Richard Shearer, Chief Executive Director, Bakcell: The building of the mobile telecommunications and information technologies sectors is a key focus of  Azerbaijani national economic development policy. Indeed, 2013 has been named the Year of ICT. Despite a number of problems inherited from the past, such as poor telecommunications infrastructure, a substantial platform for the ongoing development of Azerbaijan’s telecom sector was put in place during the last decade. The external view of our sector in Azerbaijan seems to be very positive. We have gone to the market a couple of times to raise financing, our bonds  were massively oversubscribed, which is encouraging. All of the major vendors are present here and are aggressively competing for business. In general, it is a buoyant place to be. A lot of money is flowing from the oil sector, which is coming into the non-oil sector and attracts investors. There is a lot of infrastructure to build and we have a lot of spectrum to exploit. 

A very competitive environment has allowed this sector to grow rapidly. Mobile revenues have increased two-fold, and the number of GSM subscribers has also doubled. Now, telecommunications is one of the most rapidly growing sectors in Azerbaijan and it has taken place in the context of a very strongly developing economy. The market continues to be buoyant, with new products and services being launched by the two largest operators to stimulate the market.  While subscriber penetration is high in Azerbaijan, probably in excess of 100%, the market is continuing to grow. Data is now becoming a significant revenue stream for operators and the number of dongles in the market is growing rapidly. 

CE: As of the April 2011 you are in charge of CEO, Bakcell is positioning itself as a leading mobile internet provider in Azerbaijan. What has been achieved throughout this period of time?

Richard Shearer: Along with the fact that Bakcell provides its customers with the best services, we are the Number One Mobile Interent provider and intend to continue developing our business aggressively. Moreover, we believe our mobile voice network offers the best customer experience and we intend to use this to increaseour share in the traditional mobile voice market and continue to focus on customer satisfaction.  During the past 2 years Bakcell was the fastest growing mobile operator in the country. According to the results of 2011, the biggest financial growth has been achieved by our company. According to various drive tests, our network is the most powerful among the three network operators providing the best quality signal and highest mobile internet speeds for customers. And these comparisons are not performed just by us – the users and independent organizations have also noted the fact that our network is the best performing. 

CE: What percentage of the country’s territory have you managed to cover with 3G services? 

Richard Shearer: During 2011, on November 23rd at BakuTel exhibition, the President of the Republic of Azerbaijan Ilham Aliyev “pushed the button” of Bakcell’s 3G Sür@ service. We wanted to make Bakcell 3G commercial launch a significant and memorable event in the history of the telecommunication market of Azerbaijan. Bakcell has worked hard to ensure its 3G Sür@ service has the best quality connection for its customers providing the best experience. Number of our 3G subscribers is growing very rapidly. Today more than 1.7 million Bakcell customers use Sür@ services. 

CE: What is the current status of your 4G plans’ implementation?

Richard Shearer: We have also demonstrated LTE (4G) service in our current network. This shows that Bakcell is ready to launch the service in the country. I would say that application of 4G service depends also on availability of relevant mobile devices. There are very few mobile devices in Azerbaijan that support 4G technology. If the number of such devices increases, Bakcell will launch 4G services commercially and we will bring the speed and service quality of Sür@ to high speed internet services using LTE. And since the majority of devices available on the market and used by subscribers support 3G, we are currently focused on widening the availability and appeal of this service.

CE: What is status of preparations for the launch of Mobile Number Portability (MNP)?

Richard Shearer: Bakcell was the first company to start preparation for the introduction of MNP. In January 2012 we implemented the new 10-digit dialing, by applying our 055 prefix before the number for making on-net calls. Bakcell’s network is fully ready to implement MNP. We have invested significant time and money into the development of our MNP system. Our systems are technically ready and have passed all internal acceptance tests.

Bakcell is confident that the launch of MNP will increase competition in the Azerbaijani mobile communications market and we are very committed to its introduction. Other markets’ experience clearly indicates that providing customers with increased options for choice leads to greater competition and customer benefit. Along with this, we see a significant opportunity for Bakcell in the corporate segment and also the national businesses segment. Bakcell’s revenues and profits mostly come from the consumer market and we see opportunities to move into the big international corporates and large national businesses operating in Azerbaijan, which for one reason or another currently have accounts with our competitors. We think the credibility we have built up in the consumer market puts us in a very good position to move into these segments. 

CE:  What should Bakcell customers expect in the near future?

Richard Shearer: We have a great brand, high quality services, very strong network, stable income and now a one-of-a-kind partnership with Manchester United. Our customers can be sure that Bakcell will continue introducing the best services in terms of quality and prices, bring great new innovations to the market and continue to ‘set the pace’ for competition and quality. Of course, we are planning to bring lots of novelties to our customers in the near future…...watch this space! 

CE:  Bakcell has extensive CSR program. On which stage of development are your CSR projects today, and are there any new plans in this regard?

Richard Shearer: Social responsibility is an important element of our brand. We see ourselves as a large national company that has social responsibilities within a country that is evolving. Azerbaijan is still quite a young country and some of the social fabrics need to be enhanced, and we see ourselves being able to assist with that. Our CSR strategy is one of the elements that differentiates our brand and we attach great significance to our CSR projects. Our Bakcell Stars program supports children-in-need, it has been running succesfully for about two years now. Another important direction of our CSR policy is to bring young people closer to the ICT world, to increase their knowledge in the telecommunitaions area and to formulate our position as the country’s “IP address”. Along with the partnership with such well-known organizations such as Junior Achivement Azerbaijan, SOS Children Villages, United Aid for Azerbaijan, etc. We are planning cooperation with UNICEF within our long-term partnership program with Manchester United football club. 

CE:  On what stage is Bakcell’s partnership with Manchester United?

Richard Shearer: Manchester United is an incredibly well-known brand. We are the only partner for Manchester United in the region, and it has provided us a very strong platform to take our brand to the next level and also to get us recognition more widely outside Azerbaijan. The content that Manchester United brings to the partnership and the opportunities for us to leverage its brand amongst our customers and the broader market as a whole is fantastic. We looked at several other clubs and other sports, and the package that Manchester United brought was significantly better than anybody else could deliver. We have had a number of events already and a very big launch event, which brought us a large amount of brand recognition. We are currently leveraging content to our customers and also the broader partnership relationship with our corporate customers and opinion-makers in the country. Football is a global game; it reaches out and touches people at all levels of society. It is a great means for people to talk and interact, and we like people talking and interacting, especially when they do it on our network. It is a sport that touches people at the senior levels as well as the more mainstream levels; it is a very egalitarian sport and a lot of the brand values associated with the sport and specifically Manchester United resonates very well with our own brand values.

We are continuing to surprise our customers, especially football fans not only with a special Manchester United package that Bakcell offers, but also with series of activities with participation of legendary football players. Legendary goalkeeper of Manchester United Peter Schmeichel visited Baku, participated in launch of Bakcell-Manchester United partnership and met Azerbaijani football fans in October 2012. Another legend of Manchester United, Dwight Yorke will visit Baku within our partnership and till take part in a lot of activities including the game of Azerbaijan and World football veterans dedicated to the 90th anniversary of Azerbaijan National Leader Heydar Aliyev.