Alternative provider

Bahraini voice and data service provider Kalaam Telecom has not let its failure in securing the kingdom’s recent fixed wireless broadband licence prevent it from ploughing ahead with plans to become the market leader in the fixed wireless sector. CommsMEA caught up with Andrew Hanna, Kalaam chief marketing officer to find out how the company intends to make the most of the current situation.

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By  Administrator Published  December 31, 2006

CommsMEA: What have been the current developments in terms of bahrain’s first fixed wireless broadband licence, and what has Kalaam’s role been in the licence tender?

Andrew Hanna: In Bahrain we have a number of players attempting to win the broadband fixed wireless licence at the moment. Kalaam has put a bid in for this licence but we have not been short-listed. Therefore our plan is to rollout our own fixed wireless solution over the next three months in cooperation with Green Packet, a Malaysian broadband infrastructure supplier, based on the restricted and unrestricted spectrum, so this is going to be a major factor for us in the immediate future. We will be the first to the Bahraini market with our own fixed wireless solution, which is based on the Green Packet platform and is scheduled to launch before the end of the first quarter of 2007.

CommsMEA: So you decided to move ahead with the green packet solution but also bid for the fixed wireless licence?

AH: Yes, absolutely, the two were taking place at the same time. We are pushing ahead with the Green Packet solution on the 2.4GHz and 3.5GHz frequencies, so we are able to support both spectrums. In the immediate instance we are going ahead on the 2.4GHz spectrum, as we have not been successful with the 3.5GHz restricted spectrum licence, but, if there should be some further developments with the granting of fixed wireless licences, we will be able to move our solution up to 3.5GHz and launch our service as a restricted service based on a restricted, licensed, spectrum.

The loss of the first licence does not impact our strategy all that much. We are obviously interested in the 3.5GHz spectrum but that is not currently available. Regardless, we will be the first to the market with our own fixed wireless solution because we are able to utilise the unrestricted spectrum outside 3.5GHz. We always had that in mind; you may win or you may lose the bid, so you need a contingency plan.

CommsMEA: Could you describe the breadth of Kalaam’s operations and what your current aims and strategies are in the Bahraini market?

AH: Our company was incorporated around 18 months ago. The Kalaam team came on board and in the last 18-20 months we have been setting up the commercial as well as the technical side of the company, which concerns the marketing and customer service side, the operational side and the back office and the front office developments.

So far our main product consists of a number of voice and data services. Voice services have been primarily carrier pre-select and indirect international dialling. We have a VoIP service that we branded Net Talk.

Additionally we have our business internet services, which we provide through ethernet or a point-to-point wireless broadband network that we are piggybacking off Batelco. That is a fixed internet service called Kalaam Internet.

In terms of value added services our portfolio is extending, so we are looking at IP-centric services and we are looking at the full suite of IP services. One of the primary products that we have had success with over the last 12 months has been prepaid international calling cards, which have been very successful for us. They have allowed us to capture a large percentage of market share in terms of international traffic coming in and out of Bahrain.

CommsMEA: In what direction will your portfolio be moving in over the coming months?

AH: Where we are moving towards is a comprehensive voice, data and value added services portfolio. We want to make sure we develop a solid business plan with highend data products that we can saturate the corporate sector with. This will include things like MPLS, IP VPN and hardcore data products.

We are carrying our plans out in conjunction with local and overseas companies, we want to be a leader in the fixed wireless area, be it on restricted or unrestricted licences. Fixed wireless broadband is very important for us in terms of providing last mile access, which is what we are looking for and we can do that by unbundling the local loop, which is one option. Our voice portfolio will include TDM as well as VoIP. So we are pushing the traditional as well as disruptive technologies.

CommsMEA: How has Kalaam coped with operating in one of the most competitive telecoms markets in the MENA region?

AH: Bahrain is becoming extremely deregulated. There are probably in excess of 50 licences that are being issued in the market place. In addition to Batelco and MTC, which are running the two main GSM licences, there are probably four or five strong operators that can make a difference in the market place. Obviously Kalaam is one of those.

I admit the competitive landscape in Bahrain is very tough. In terms of penetration, broadband is very low and you have a very strong incumbent. In addition there is a shift towards a convergence of players such as MTC, moving into the fixed and fixed wireless space. There does not only have to be a synergy between 3G and 3.5G but also a synergy with your own portfolio, with your own corporate portfolio, and what you can provide your end users. So the competitive landscape in Bahrain with 700,000 residents is very tough, just in terms of the usual market dynamics.

Does that mean certain companies have competitive advantages? Absolutely. For Kalaam service has been extremely important for us. Concentrating on launching a number of products that are relevant to the market place has of course been vital, and remaining relevant to our brand and relevant to our segment of the market has also been incredibly high on the agenda. We have also been focusing on launching disruptive technologies that can steal market share from the incumbent and give customers a new edge in using new technologies.

We also have a competitive edge and advantage in terms of our own channels to market. We are constantly looking for new ways to reach the customer. So we launched our services with a very strong call centre and we launched with a very strong and customer friendly website that we tried to make as interactive as possible for our customers.

We are also looking at a very strong retail partnership, through direct partnerships or indirect ones. Obviously being competitive on price goes without saying. We have been very strong on price and the price on calling the most common destinations has undergone a substantial reduction in Bahrain over the last 12 months as a result of increasing competition. However, price is one of the easiest elements to compete on, the tactics you employ that take you beyond competing on price are the ones that really prove to be significant.

CommsMEA: What have been the most important areas Lalaam has been competing on in Bahrain?

AH: Other ways to be competitive are to look at aspects such as customer service. We invested an incredible amount of time and effort in developing channels to the market and devising and maintaining a strong brand presence. A great deal of consideration was put into developing the Kalaam brand that you see today and I think we have done a very good job compared to what the competition in the market place has done in terms of branding. Many of the operators that are coming into the market place are very well funded and some of them are very well run in terms of management. What we have strived to do is make sure we have recruited and installed the best individuals who can provide us with that extra edge in terms of commercial operations and also in terms of the technical know-how. So we have put a lot of time money and effort into all of the above in order to ensure we receive a high degree of competitive advantage from it.

CommsMEA: Does Kalaam have any short to medium term plans to explore opportunities outside of Bahrain?

AH: We are actively pursuing opportunities. Bahrain for us, from day one, in terms of our business plan, has been about proving our business case, proving our business model, getting some very good runs on the board, and then taking it from there.

Therefore, the key initiative for myself, the executive management team, and the board of Kalaam, is to look for new expansion opportunities outside of Bahrain. I think we have done a very good job in Bahrain, in terms of building up the ground, engineering competitive advantages and generating decent financial returns.

The other side to the coin is for us to leverage all of what we have achieved in Bahrain, and the know-how we have accumulated, and venture into other markets.

Now those markets could be deregulating or deregulated. So the most appealing mediumterm opportunities would be in Jordan, Qatar and Saudi Arabia. These are the countries that have announced plans to deregulate fixed wireless broadband markets as well as having existing opportunities that we can look into in terms of partnerships, though we are not adverse to taking up external opportunities where we would come in and start from scratch. All of the above mentioned markets have the right dynamics for us.

Obviously this does not mean we will neglect Bahrain. We have an excellent team to continue to take our Bahrain operations forward. Telecoms as you are well aware of is a business of applying your acquired skill.

Therefore, as soon as one can leverage off the skill and experience one has developed, the sooner one can move forward in terms of profitability.

CommsMEA: What are the indicators Kalaam has installed to measure its success and what objectives have been put in place for the future?

AH: In terms of us becoming a profitable enterprise we are well ahead of the game, so that is one obvious signpost. Also acquiring the right customer segment relevant to our business is another indicator that we are on the right track. We also measure ourselves in terms of acquisition, in terms of revenue targets that we have set ourselves, in terms of profitability targets we have set ourselves, as well as the development of our product portfolio. Yes, hitting numerical targets is highly important, but in order to drive the numbers there are intangibles that have to be taken into account, such as the on-theground brand recognition and market place positioning.

One of the personal milestones for us is to be the leader of the fixed wireless sector in Bahrain and to be at the forefront of introducing disruptive and innovative technologies. Net Talk is an innovative product and has not previously been launched in Bahrain or the GCC. So these are the signposts we have put in place for us to move forward to make sure we accrue competitive advantages, so we can replicate the business model in other regions. A significant amount of potential does exist in the market and we are determined to tap into it.

“We will be the first to the Bahraini market with our own fixed wireless solution, which is based on the Green Packet platform”

“Price is one of the easiest elements to compete on, the tactics you employ are what take you beyond competing on price and are what is really significant”

“The key initiative for myself, the executive management team, and the board of Kalaam, is to look for new expansion opportunities outside of Bahrain”

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