Caspian Energy (CE): Mr. Shearer, please talk about the la­test achievements of Bakcell. What is priority for your company in terms of network development? Can it be confirmed that Bakcell’s network is everywhere in Azerbaijan? 

Richard Shearer, Chief Executive Officer, Bakcell: Bakcell is the fastest growing mobile operator of the Azerbaijani telecommunication market during the last couple of years. Our 3G Sür@ mobile internet is continuing to grow. Today more than 75% our customers use Bakcell mobile data services. Bakcell 3G service is available in all regions and covers 80% of population and 65% of the territory of the country. 

Bakcell is the only telecommunication partner of Manchester United Football Club in all CIS regions and this long-term partnership can be considered as the biggest marketing event of the country. 

As regards to network, we have realized a series of projects during 2013, making investment in the network to provide the best data and voice services experience for Bakcell customers. Earlier this year, in cooperation with Huawei, we have implemented modernization of the whole transmission network to extend capacity and migrate to the MPLS-TP technology to ensure we can handle the explosive growth of data traffic on our network. Another huge project to support internet traffic and service ma­nagement in our network is the introduction of Policy Management via PCRF which brings large capacity and high flexibility to Bakcell to meet customers’ expectations and provide the best service for its customers. This project has been implemented jointly with the Nokia Solutions Networks. These new technologies makes Bakcell’s network the most advanced in the Azerbaijani market and provide Bakcell customers with the highest qua­lity mobile communication. 

Can we say that Bakcell is everywhere in Azerbaijan? Yes, we can.  Bakcell’s network covers more than 99% of the population and 93% of the land area of the country excluding occupied territories. Bakcell 3G service is available in all regions of the country. We have 350 retail outlets and 20 Customer Service Points throughout the country. 

CE: Which successful products and services have been introduced in the market by Bakcell during 2013? 

Richard Shearer: Bakcell has three main tariff packages – CIN, Klass and Gold which we improve continuously. One of our successful products in 2013 was New Klass tariff package tailored to different groups of subscribers according to their monthly needs in talks, messaging and Mobile Internet usage. 

In order to make available a convenient balance top-up service at countries frequently visited by Azerbaijani citizens, and countries where the Azerbaijani communities are concentrated, Bakcell launched International Balance Top-up for the first time among Azerbaijani telecommunication players. This service enab­les customers who are in roaming to top-up their ba­lance while traveling overseas by using POS terminals and bank branches. Family members and friends who work and live in Russia can also top-up Bakcell phones of family and friends living in Azerbaijan as well. In the near future, the service will be available also in Turkey, Kazakhstan and the United Arab Emirates. 

CE: In summer of this year Bakcell has launched Wi-Fi Internet zones in Baku? How this service has been adopted by your customers? And are you planning to extend Wi-Fi zones to other cities of Azerbaijan in near future?

Richard Shearer: Bakcell has used the latest available techno­logy to provide the largest outdoor Wi-Fi coverage in Azerbaijan to date. Bakcell’s Wi-Fi Internet is available in various locations of Baku, such as the Academy of Sciences and Huseyn Javid Park, Philharmonic Hall Park and Icheri Sheher subway station area, Fountain Square, Nizami Street, Park named after Zarifa Aliyeva, Narimanov Park, Sabir Park, Khagani Park, Sahil Park, and Central Railway station. We are pleased to have a significant number of customers for Bakcell’s Wi-Fi service and plan to extend it in future. But at the first stage, we are planning to increase the number of Wi-Fi zones in Baku. We will closely monitor customer feedback and usage of our outdoor Wi-Fi services in Baku and based on results certain decisions will be made for further expansion in regions.

CE: Majority of business people claim that roaming tariffs of the Azerbaijani mobile operators is very high. Do you have plans to reduce tariffs for roaming services during the next future? 

Richard Shearer: Roaming tariffs are being mainly composed of costs applied by our international roaming partners. Therefore our roaming tariffs are not a product of our pricing policy - price markup of local mobile operators is very much imperceptible. But we launch various roaming campaigns with beneficial tariffs. For example, we have roaming campaign for CIN and New Klass subscribers leaving the country to Turkey, Georgia, Russia, Kazakhstan and Ukraine. While visiting these 5 countries, Bakcell subscribers will be charged only 0.35 AZN for incoming and 0.75 AZN for outgoing calls which is the best offer in the market vs up to 0.80 and 1.50 AZN per minute on other networks.   

CE: How the Mobile Number Portability (MNP) has influenced the situation in the mobile service market in Azerbaijan?

Richard Shearer: It is too early to talk about the impacts of MNP in the mobile service market in Azerbaijan because the process has not been started by all mobile operators. Bakcell was the first mobile operator launching Mobile Number Portability (MNP) process on August 1, 2013, on the date defined by the Ministry of Communication and Information Technologies. But the service should be supported by other mobile operators in order to be able to implement port in process. Bakcell is registering port-in requests of subscribers of other mobile operators, but MNP process requires the readiness and interaction of all operators, which is not the case right now. Bakcell was also the first company starting preparation for the introduction of MNP by implementing the new 10-digit dialing and by applying 055 prefix before the number for making on-net calls in the beginning of 2012. 

But we are confident that the launch of MNP will increase competition and choice in the Azerbaijani mobile communications market. 

CE: How do you assess Bakcell’s position in B2B segment? What is Bakcell’s position in the corporate segment? 

Richard Shearer: Bakcell has historically been a highly consumer centric business. We have special position in the corporate segment. We have had many notable successes; winning new business with these demanding customers. We have been especially successful by focusing on the oil sector where we have won many new and large customers. 

We believe that MNP will strengthen our position in corporate segment as well as many customers are “trapped” by their current mobile number being available only in one network, with MNP all numbers will be available in all networks.

CE: Today, most of people in the world talk about 4G services which have more benefits in compare with 3G. How is the situation in Azerbaijan? When Bakcell is planning launch of 4G services? 

Richard Shearer: We have demonstrated a pre-commercial 4G LTE network running in Baku in 2011.  However over the last twenty months Bakcell has focused hard to ensure its 3G Sür@ service is the best customer experience and the most reliable and fastest means to use the Mobile Internet for Azerbaijanis.  Bakcell is extremely ‘spectrum rich’. We have 900Mhz, 1800Mhz, 1900Mhz and 2300Mhz spectrum to exploit to provide new and exciting services to our customers.  Today we have spectrum available to launch 4G services and have been trialing systems in Baku for over one year. We have closely monitored the development of the market and of our customer’s usage patterns. During the last 12 months we have seen an explosive growth in internet traffic and particularly the rise of video on our network. YouTube is our biggest single internet ‘service’.  As the usage of the internet in Azerbaijan moves from information and email to entertainment and social media we are seeing changes in usage and consumption patterns.  It is these changes and the move to richer, more bandwidth intensive services which will drive us to 4G. We believe the inflexion point where 4G becomes a more economically viable technology to meet customer demands together with the proliferation of handsets supporting 4G LTE is approaching and as such we are preparing to meet those customer demands by launching 4G LTE services in the near future.

As well as providing greater capacity to our network through deployment of new technologies such as 4G we are also focused on increasing the coverage and availability of Mobile Internet services throughout the country so more people can access and enjoy the benefits of internet usage.

CE: Bakcell is a telecommunication partner of Manchester United. What strategies led to the decision to enter into this partnership?

Richard Shearer: It is an incredibly well-known brand. It reaches outside of just football, it is the world’s premier football club; it is the best football team, and we like to think we are the best mobile operator. 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 are currently leveraging content to our customers and also the broader partnership relationship with our corporate customers and opinion-makers in the country.