Tried and Tested

Ericsson is enjoying a period of unprecedented success in the Middle East and North Africa region, and attributes much of its success to building personal relationships with corporates and operators. The region's president, Bo-Erik Dahlstrom, describes how Ericsson expects to continue making progress in the face of more determined competition from rivals.

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By  Administrator Published  September 30, 2006

COMMSMEA: What do you believe are the key elements driving the telecoms sector in this region?

Bo-Erik Dahlstrom: The high oil prices, especially for the countries that have oil economies, are helping to fuel the regional economy as a whole.

And telecoms being fundamental to building businesses is enjoying strong growth.

I think more importantly, a lot of deregulation is taking place in the region in the telecoms arena.

We've seen that in the UAE, we've seen it in Saudi Arabia, Pakistan, and other countries, and there are still discussions for new licences.

And these are things being driven very much from a consumer perspective, but also given the good developments we see with existing operators, they are making quite a lot of money, and that is an interesting area for investments for others.

Then there are also technology trends that are fuelling or rather opening up new opportunities.

One is in fixed networks, where broadband becomes a much more important element.

Also broadband in the context of not just data traffic but also combining different content together.

And the technology that has now emerged allows triple play to be combined in the network in an efficient way.

You can start building business models around providing all three types of content, and we are also talking about quadruple play here, when you add mobility to the offering One example is the Dubai Marina where we are providing a triple play service, and that's actually in partnership with a construction company that has not traditionally been in telecoms.

So you can leverage the technology to build it into other offerings that have been done with real estate for instance.

There are a lot of developments taking place - Dubai Marina is one, the Pearl in Qatar, King Fahd City in Saudi, and all of these projects need to be based on robust telecoms networks and infrastructure.

CMEA: What is Ericsson doing to help operators navigate their way to new technologies and business models?

BD: Countries are trying to build their economies, and I think that many people now recognise the fact that the telecoms part of that is very important, even to the extent that it adds to GDP growth.

There has been a study done by London Business School that shows a clear correlation between investment in the telecoms area and GDP growth.

When it comes to operator strategy, I think the strategy is two-fold.

One aspect is the behaviour of these operators in their own country or region, where they are preparing for competition and have to sharpen up in a sense.

So I think that is driving incumbent operators, they are reshaping themselves, understanding that it is less about providing the basic infrastructure and technology, and more about bundling products and making them attractive to end-users.

I think incumbent operators also realise that their home markets are becoming too small now, and that's where they see opportunities close to the Middle East, for cultural reasons, but also for geographic reasons.

What we are doing in terms of helping these operators is offering an entire span of activities that an operator can need and go through, from actually helping them create the business case, and adding the local context.

I think this is a big strength of Ericsson - we are present in more or less every country in the world.

Then on the more traditional services we can then take full responsibility to build and operate a network, and that is also what we are doing for many of the greenfield operations that have emerged.

So for instance when it comes to Nawras in Oman, we are running its network, and the same goes for Mobily in Saudi and Warid in Pakistan.

CMEA: What is the uptake of manages services looking like?

BD: The fact that we have three managed service operations in the Middle East already, and a large managed part with STC in Saudi, I think it's a good concept and is quite sort after by operators in the Middle East region.

Apart from time to market, another advantage of managed service agreements is because technology is moving so quickly, operators often need a partner in that respect.

It helps them to know how to place their bets in the best way to be competitive going forward.

It's not only what you are doing today with the traditional services, but also how do you make sure that you can actually tap into a new service once the market for it.

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