New leader, new brand, new zest

Greg Young was appointed CEO of Ooredoo Oman (then Nawras) in October 2013, replacing founding CEO, Ross Cormack. In recent times the operator has stalled operationally as well as financially having reported shrinking revenues and net profit, wreaking havoc with its share price. Since taking the reins Young has stabilised the telco’s performance and believes he can breathe new life into the operator and watch it fulfil its potential

Prior to his appointment as CEO of Ooredoo Oman in October 2013, Greg Young acknowledges there was a period of under-investment at the company that may have given rise to some under-performance

“There has been an ongoing investment programme at Ooredoo Oman, which kicked-off in 2012,” Greg Young explained to Comm. “There had been a period of under-investment, and we have also been busy changing the organisational structure of the company.”

Ooredoo’s sales and distribution, marketing, advertising, and promotion have been realigned along consumer and business categories, and commercial and enterprise segments, with the telco looking to bring together different disciplines for greater effectiveness and efficiency.

The programmes that are being instituted under Young’s leadership appear to be paying off. For the first quarter of 2015, Ooredoo Oman reported revenues were up 12.5 per cent to OMR 59.3 million (US$154 million) year-on-year, driven by increases in both mobile and fixed data revenue.

EBITDA for the quarter amounted to OMR 33.8 million, up 23.8 per cent year-on-year due to higher revenue, while net profit came in at OMR 10.7 million, up 21.6 per cent on an improvement in EBITDA that was partially off-set by investment in network modernisation and expansion.

Total customer numbers grew by 11.6 per cent in Q1 2015 from 2.43 million to 2.71 million.

Ooredoo Oman reported that the fixed service customer base decreased by 11.1 per cent to 58,435 customers in Q1 2015, accounted for by the transition period to a new home broadband technology that is set to bring improved services to Ooredoo customers. The mobile post-paid customer base grew by 5.1 per cent to 199,206 customers, while the prepaid base for the quarter was up 12.8 per cent to 2.46 million.

“We are growing data usage and monetising it,” said Young. “We remain mindful of appropriately managing costs, and are finding the right balance between short-term investment and long-term strategy as we maintain a strong eye to the future,” he added.

One such long-term play is the re-branding that Ooredoo Oman undertook from Nawras in November 2014, becoming the seventh market to take on the global brand.

With the Ooredoo name present at the time in Qatar, Algeria, Tunisia, Kuwait, the Maldives, Myanmar and then Oman, the telco claimed customers had already seen significant benefits and changes to the customer experience accompanying the brand transformation. Ooredoo generally operates in heavily youth-oriented markets characterised by strong and rising demand for data services.

In Oman, a new post-paid promotion enabled customers to use their local minutes when roaming overseas, while prepaid customers received more international calls.

Ooredoo Oman also leveraged its global relationships with major device manufacturers to bring the latest technology to the country, launching the iPhone 6 with a special post-paid bundle so that customers could receive the most out of the device.

The enterprise segment for telecom services in Oman is largely dominated by Omantel, and with a now clear branding link to an international group in the form of Ooredoo Group, Young believes the Oman operator now possesses the credentials to allow it to make some noticeable in-roads into the sector.

“The business enterprise segment for Ooredoo Oman is small at this point in time, but it is growing for us, be it from a small base,” Young said. “GDP growth in Oman is a factor, with the development of mega infrastructure projects. As a telco, we also have an interest in driving the small and medium size enterprise (SME) segment, and believe there is growth there that can be captured,” he added.

Young believes the SME segment is one that is underserviced by Omantel, and given Ooredoo Oman’s 100 per cent fibre optic network that offers total redundancy independent of the state telco’s, considers the growth opportunity in this area as significant.

Ooredoo Oman is also invested in the TGN-Gulf undersea cable in cooperation with Tata Communications, which routes voice and data traffic from Oman to Mumbai (India) and onwards to the rest of the world, via the Tata Global Network (TGN). The cable link, which was inaugurated in 2011, offers enormous capacity for broadband and high quality voice services, enabling Ooredoo Oman to meet the growing demand for international voice and data services from its customers.

Nawras rebranded to Ooredoo in November 2014 to become the seventh market to take on the global brand behind Qatar, Algeria, Tunisia, Kuwait, the Maldives, and Myanmar

Data remains an obviously big play. Approximately one-third of Ooredoo Oman’s revenues are generated from it, inclusive of its fixed-line operation, and Young says part of the operator’s strategy is to “aggressively pursue moving customers up to data packages.”

Another area of contemplation in Oman’s telecom sector, and which is almost unique to this market in the region, is the presence of mobile virtual network operators (MVNOs), which were first introduced in 2009, and have since been able to garner 8-10 per cent of the overall mobile subscriber base amongst them.

“The market share held by MVNOs is probably about double the share they achieve in other markets,” Young commented. “They are significant in their own right, and bring competition and choice into the market. I believe there were meant to be five MVNOs operational in total, but today in Oman we have three that are active in the market – two in the consumer space, and one that is active in international traffic, and is less visible on the consumer side.”

Looking ahead, Young says that Ooredoo Oman will be in execution mode as it continues to familiarise the market with the new brand and introduces new products and services to take advantage of the 65 per cent penetration of smartphones within the customer base. SMEs and enterprises will also be focus areas as the operator continues with the modernisation of its network, and backbone, which it specifically says is nearing completion.

“We are going to continue managing costs and look to ways we can offer our customers an even better service. We have a resident population of four million in Oman, which is heavily dispersed, and with a mobile penetration rate of 150 per cent. Yet we still see growth opportunities we can leverage to our benefit,” Young concluded.