With du, whose initial public offering was held on March 4 this year, the UAE has a second telecom, Internet and cable TV services provider, an alternative to long-established Etisalat. du’s CEO, Osman Sultan, who launched the highly successful MobiNil in Egypt in 1998, discusses the evolution of the UAE telecom sector and the impact du is expected to have on the market.
Many countries decide to open up the telecom market. What makes du’s situation unusual?
First of all, never anywhere in the world has a new telecom company entered the market when the level of penetration of services has been as high as is the case with Etisalat. In addition, du is licensed to provide fullfledged telecom services and was created at the end of 2005, which is a unique time to create an integrated operator, as the market is moving at lightning speeds. The third reason this situation is unique is that the shareholders of this company decided that they will not partner up with an international or a regional player. We want to do it our way.
How do you expect to differentiate du from the competition?
One thing we will not do is offer the same services as Etisalat’s, but cheaper. A price war would result in a destruction of value, and our purpose is to create value. We will focus on pleasing our customers, rewarding the people working for us because our human capital is our top asset, and creating value for our shareholders. We will also differentiate du ourselves by moving faster in the market. Telecom today is no longer about wanting to make a telephone call; it’s about wanting to take your environment anywhere, having your office, music, everything, at all times wherever you are. Also, people are using their telephones for things they used to use their computers for, using their computers for things they used to use their televisions for, using their plasma TV screens as their computer screens, synchronizing e-mail on their mobile telephones, etc. It’s all changing, and we believe we can go faster than the competition in providing these new applications, not just faster than Etisalat, but also faster than some European operators.
How are you planning to market the du brand name?
One of the key points of our differentiation is that we don’t believe one size fits all. A local laborer has certain telecom needs that are completely different from those of an expatriate visitor who is coming to invest and do business and use different applications. A young person may be most interested in SMS, ringtones, all those fun applications, while a working mother may have very different priorities. We want to personalize our brand so that we can connect with each individual customer. For example, I don’t want du to speak just one language. I want it to relate to all languages, in Urdu, in Bengali, Arabic, English. A brand is not only a logo, a color, a tagline or whatever. A brand is really the way you live, the things you want to deliver to the market. We are putting a lot of effort into ensuring that our employees communicate our values of confidence, friendliness, honesty, and the ability to surprise.
Great momentum has been created since we launched our brand, because people already see the brand as completely different. For example, everyone was expecting us to be called “something”COM or “something” TEL, so our name was a surprise. We really want people to liaise, bond and interact with us in a different way. How can we understand our customers’ needs better? How can we come up with the products and applications that suit their needs? How can we offer the best possible service that will help make our customers’ lives easier? That is what people will appreciate, and this is how to create loyalty to a brand.
What is your schedule for launching services on du?
We will be launching our mobile services nationwide in the second half of this year, most likely the last quarter. We are in the process of building our mobile infrastructure with Nokia as a partner. We are also building our capacity in terms of people. Today we have around 650 people and we expect to have a staff of at least 1,000 by the end of the year.
Who are du’s partners and shareholders?
We are working with Cisco concerning our network, and du acquired the telecom assets of TECOM, one of our shareholders, for AED1.2 billion at the beginning of the year.
TECOM was providing fixed-line VOIP services, Internet services and PayTV services within the free zones in Dubai Internet City, Dubai Media City and some of the real estate development projects around Dubai. As for our shareholding structure, 40% is held by the federal government, 20% by Mubadala (the investment arm of the Abu Dhabi government), 20% by TECOM, and 20% public shareholders. The company is floated on the Dubai exchange.
How do you think the competition you will give Etisalat will change the market?
The way I see this competition moving is more and more into services applications, with infrastructure becoming something that will be a given. I don’t think that we will differentiate ourselves from Etisalat in infrastructure or in access, but rather in services, and the regulator can make sure any company can offer any service anywhere, so that the customer can have a real choice. Another good thing about competition is that the former monopoly player is not the master of the game anymore. The master of the game becomes the public.
What makes dubai a good base for du?
First of all, there is the strong support of His Highness and his vision. Any investment project needs to be able to count on government support, and that is the case here in dubai. Secondly, an investment needs a proper regulatory and administrative environment, and Dubai offers that as well. Third, an investment requires a positive economic situation. Dubai’s thriving economy provides that, too.
What about the future for du?
In my position as the CEO of the company, I need to ensure that the company is doing everything to create value: value for the shareholders, for the entire sector of telecom and ultimately for Dubai’s national economy. We are currently focusing on our domestic market, but one of our shareholders already has international interests; TECOM acquired 35 percent of Tunisia Telecom and is also interested in Malta. Overall, I want people to see us not just as the challenger of today, but as the leader of tomorrow. I want people to know that we will be knocking earlier on the doors of this great future of the telecom industry.
Osman Sultan has been appointed CEO of Emirates Integrated Telecommunications Company, du, starting 1st of January 2006, after spending eight years at the helm of the Egyptian Company for Mobile Services (MobiNil), a company he helped set up in 1998 to bid for and operate a GSM licence in Egypt.
As former Chairman of the Arab Working Group for the Private Sector in the International Telecommunications Union (ITU), he is no stranger to the UAE, having addressed several conferences in the country on telecommunications issues.
His vast experience includes managing operations in several countries in Europe, North America and the Middle East.
Mr. Sultan joined the France Telecom Group in 1983 and for the next 11 years worked in management positions in sales, marketing and customer services activities in one of France Telecom’s subsidiaries that specialised in electronic information content services.
In 1994 he was actively involved in the acquisition of a US based operations and was appointed Vice President for Worldwide marketing & sales for the new company. In this capacity he was in charge of the merger of two companies in the USA and Europe. He also managed operations in Paris, Washington, London, Frankfurt and Sydney and the set up of a large distribution network in more than 20 countries in Europe, South America, the Middle East, Asia and Japan.
In 1995, he was appointed President of a US based subsidiary, with a goal of developing a growing business of professional Online Content Services.
In 1996 Mr. Sultan received the award for The Best Web Site-Legal Product from the American Information Association and in 1997 received the Man of the Year award from the Professional Electronic Information Services Association in France.
In 1997, Osman Sultan joined France Telecom Mobiles International (FTMI) as Vice President for Business Development in charge of the Middle East and the Arab World.
That same year he was in charge of putting together the MobiNil consortium bid for a GSM license in Egypt. The consortium succeeded in acquiring 68 percent of Egyptian Company for Mobile Services.
Osman Sultan holds a Degree in Engineering and has addressed several conferences on Telecommunications and Electronic Information Services, Mobile Telecom and the Internet in the Middle East (Egypt, Lebanon, Morocco, Tunisia, UAE), Japan, the USA and Europe.
