Zain Bahrain

Bahrain has been at the cutting edge of Middle Eastern telecommunications since the government liberalized the sector in 2002.  What is your assessment of the Bahrain telecom sector and what are the key opportunities and challenges?

Bahrain telecom sector is one of the most promising business areas if we look at our sectors within the past few years.  There was great amount of growth in the sector, and there were a lot of job opportunities created in the sector.  The main driver behind this was the vision that the government of Bahrain had.  I think the government had a great vision in terms of creating a good regulation environment, creating the telecom regulator – the TRA –and three that a lot of opportunities were created.  We had growth rates in the mobile market; we are now looking into the fixed and broadband markets in Bahrain.  The telecom market has really been a growth market from 2003 up to date.

Alan Horne, the TRA general director said “a good regulator promotes competition to force down prices and is not afraid to flex its muscles when required.” What is your assessment of the regulatory framework in Bahrain, and what areas could be improved to facilitate your operations?

I think the regulator has played a fundamental role within the market here, and within liberalization.  I think they had a good plan in terms of the liberalization; they first tapped the mobile market.  And yes I fully agree that a regulator should not only work to break up monopolies or just looking for opportunities in the market, they should also really support competition.  So I fully agree that the role of the regulator is to actually entice the market for more competition and to allow different players in the market, not only to compete in price but also in value.  The most important thing in this market is that you don’t want to just drive prices down get without considering the value that you’re offering your customers in the market.  I think the regulator in Bahrain has played a fantastic role in that area.  They have actually done that in the mobile sector, and if we look at the amount of services offered to the customers, the quality of service that the customers are getting has been enhanced, and the amount of customer experience has also been enhanced in that arena.  That is in addition to the new services and technology in the market, so if we think about it, it is value for life.  A customer can really get more out of telecom services to really affect his or her lifestyle, and to really make a person’s life much easier, in terms of communication, entertainment, and news.  Today we’re talking about a different arena so it is more about value and not only about price.  That is our view in terms of the market, so it is a combination of both.

Recently, Zain introduced Drive 2011, a program that will see the company focusing on customer phasing services, commercial activities, while centralizing and outsourcing certain non-core functions to strategic partners.  How does the program reflect on to your operations in Bahrain?  

The Bahrain operation was the first green field operation for Zain, where we had to set up the network and the operation from zero.  Hence it has been built as a model operation.  In terms of outsourcing, efficiencies and all those aspects, the Bahrain operation has been a leader in this area.  I will give you an example.  Our IT operations are fully outsourced since 2003, so in terms of outsourcing and efficiencies this is nothing new for Zain Bahrain.  Every year we look into different areas where we feel a partner can actually add more value into that area than ourselves.  We can focus on core areas that we can add better value to, and so we take off the other areas and gives them to a partner who can add more value to them in coordination with us; of course we never submit them to a partner with out proper agreements, service levels and quality measures in place. Drive 2011 is nothing new for the Bahrain operation, it is more of an emphasis and continuation of what we have actually started in 2003 to run this operation leaner, more efficient, and to be quick and offer a better service to our customers by giving different areas to people who would actually execute it in the best manner, whether it is us or our partners.

The CEO of Batelco Bahrain mentioned “the competition will ultimately lead to Zain and other operators being the largest customers for the incumbent.” To what extent you agree with this statement, and do you think Zain provides better services than Batelco?

Being the general manager of Zain I have to say that we provide better services.  At the end of the day, regardless of the players in the market there is of course some association, not that we’re total enemies in the market, no. We add value in complement each other in the telecommunications market, and this is how we actually work for Bahrain at the end of the day.  So there are areas where we as competitors do business together, and this is well-known and that is how we come together. I can’t say that I have anything and everything and that I am isolated here, no definitely not. Whether we will be the biggest customers of a certain operator or not is a question that depends on how much we actually add value to each other.  But it is an open discussion and I believe that at the end of the day we are all here to provide value to the customers, whether we do business together in certain areas, or we do it in isolation alone.  I think we have done a fantastic job in the last five years. Since 2003 we have been growing year after year, we have offered unique and differentiated services to the customers. We had even offered different experience when it comes to retail.  For example we can talk about the latest flagship store we have launched. It is not only hitting on telecommunications, we have new standards in providing services in retail offering.  We have actually added a lot of value to the market here and we have offered services to the customers.  So definitely I would say that we have provided a good service.  We have even provided some standards in terms of customer care and call centers.  We have actually force the market in one way or another to raise their bars in terms of service offerings to the customers.

Recently Saudi Telecom Company has won Bahrain’s third mobile network operating license with a bid of 86 million B.D.  They have plans to launch their Bahraini operation in the second half of 2009.  According to the TRA, the third license was granted because the introduction of a second operator was not being effective in lowering prices.  How do you assess the effect of Zain on the Bahraini market?  Is this true?

I think there were price reductions. The TRA did their assessment at the end of 2007 that the market requires a third player to come in.  We really feel that there were price reductions in a lot of areas.  International calls for example was a big area where prices have been reduced.  Even on local calls there were price reductions in different areas.  Maybe the TRA had a few of getting prices even further down.  The point that I would like to emphasize here is that clearly you cannot just talk about reducing prices without looking at the quality aspect and your offerings to the customer.  We can reduce the prices at the end of the day with a sacrifice on the quality aspect.  It is that balance that we do not want to miss in the market.  Affordability is very important when you talk about services available for the customer here.  Again by standards we feel that the prices in Bahrain our one of the lowest and most competitive prices within the region here.  Even the TRA has benchmarks studies of overall telecom prices and we really have competitive prices vs. other markets.  So we feel that prices have gone down.  It has been a good balance of prices and quality together.

What do you think the effect will be of introducing the third network operator to the Bahraini market?

I think competition will heat up.  I think it is good for the market to have a third player.  In business you really find a period of instability once the rules of the game change and a third or fourth or fifth or whatever player comes into the market.  So that period will happen in this is good for the market.  You really have all operators working harder, providing better services to the market, providing better offerings for the customer so I think from a consumer perspective they will really benefit from the launch of a third operator because all the operators I’m sure including the existing and the new operators will offer new services and values to the customers.

Could you chart the growth of Zain Bahrain; what are the major milestones you have achieved to date and what are they going to be in the future?

Zain Bahrain has really achieved a lot in the last five years, starting from one of the most successful and quickest launches in 2003, where the launch was done in six months and the amount of coverage was nation wide coverage at that time, going all the way to the launch of the first nation wide 3G coverage, and so on.  I think we have introduced a lot of new technologies and services to the market of Bahrain.  Bahrain offers a good scale in terms of trying out these new technologies, in terms of its size, regulations and flexibilities.  The operators are very open to new ideas and technologies.  In terms of customer is, we have really grown year after year, and I think in terms of competition we really enjoyed competing. You have a high number of licenses issued what you don’t have the companies taking on these licenses who are actually active in the market.  This is due to many reasons.  With this open market for competition this is good, there are no barriers in terms of establishing a company; it is actually very easy to establish a company here, it is also quite easy to get a telecom license here, but at the end of the day I would really leave this call to any businessperson who actually comes into this market.  You have to have a plan.  Telecommunications can’t be just another means to strategy where we tested adopt something that we see a few players working out.  There should be a plan and a vision behind it.  I think that is the main reason why a lot of companies are not active in this arena.  You have really short term goals vs. long-term goals.  Utilize this market in a right way to support your vision and your plan, and if companies come in with this attitude I think the amount of potential growth within the market is definitely there for them.  So I really think companies should think twice, and I think regulators should look into this arena in terms of the number of licenses.  Maybe it should raise the bar is there a lot of companies which are not active.  But again I think the first decision should be a business person’s decision who is coming into the market.  Do you really have a mission and vision behind it?  Do you know where you want to head before you engage in this activity?  Yes the tools are easy, you can acquire them very easily, but at the end of the day you do not want to just come in for six months and then shut down your operations.  Or you don’t want to just block a license there because it is not an activity where you’re just shelving this license and later this license can be sold for 2 to 3 times without an operation.

The ICT development is integral for Bahrain’s continued growth.  What is your social role in the development of Bahrain?

Yes we are a private company.  We are business people at the end of the day, but at the end of the day we serve this community, and without this corporate and social role we will never succeed.  We cannot be in the hearts of our people and at the end of the day just taking bills from our customers.  We have a commitment where we really want to add value to the community here.  It is not only about corporate and social roles, it is about over all advantage to the country in which we operate here.  In particular in Bahrain we really had a commitment upon ourselves that we would work hard on developing youth and we have really succeeded in that perspective.  Our license said that we have to have 70% Bahrainis, today we’re close to 90% Bahrainis.  Most of them are fresh graduates and most of them have been enrolled and trained with us in this company and that has been a major success.  I would really like to emphasize this point.  The country has good calibers and good skills, you really have to give them the opportunity and the space, and utilize these talents in a working environment and I think this is exactly what we have done.  This country is rich terms of human resources, and they can adapt to different management and training styles as well.  I’m very proud to say that a lot of our managers are now from these fresh graduates; in these five years they have progressed very well, so we have achieved a major milestone in terms of that, and that has been a value to the country.  Even people who have left us in Zain here in Bahrain, today they have management and leadership positions. We really have one major contribution which we have made to the community, Bahrain University.  We actually have an e-learning center there, and this is a major milestone in terms of helping in boosting ICT development within the country because we are starting right there from the youth.  We have worked hand in hand with schools and universities in terms of providing them with those services.  We have worked hand in hand with different organizations, governmental or nongovernmental, and we have provided them with services and technology which have made their lives easier.  So we feel that we have a major role being a communications player in the market. The ICT and infrastructure development is really part of our roles and responsibilities and it should work both ways.

We are delivering a green award for companies that we have interviewed.  What is your policy towards the environment and sustainable development?

We have a commitment to deliver state of the art services which would make the lives of our customers easier and assist them in doing the day to day stuff.  I can give you an example.  We have launched one of our greatest services which is the money transfer services, you can do it over the mobile.  This will save you time, energy, calories, actually you can do it at a touch of your mobile.  Launching these services is because when we say we want to be a part of your lifestyle, we really mean it.  We want to touch on different services that affect the lifestyles of our customers.  So if you think about it, yes, there is a commitment to the environment, there is a technological commitment, there is a commitment from all those aspects.  But the major mission here is that there is a commitment to the people, to help you with your lives.  That is exactly what we’re talking about and I think that answers the questions about the environment and development.  Time flies by and we want to make sure that we are helping you to achieve the maximum you want to achieve in this time.  Having said this, I think this is a major contribution to humanity more than to anything else.  In terms of projects and developments that would really add value to the community we are actually a part of that.  We welcome any idea where we feel we can add value.  As I mentioned we had a major contribution towards education through our services.  We launched a program last year called the Zain Dream; we took the dreams of us and people who wanted to do something, and we gave them the firs steps towards translating those dreams into being an objective and a goal.  We had a person who wanted to open up a studio to reflect the heritage and bring it back and we supported this person to make his dream into reality.  We had another person who wanted to offer services to the needy and we supported him.  You go into a service that is in a completely different direction but it has added value to the community.  So there is this environmental commitment from our side.  We are here for people and to help people and this is why we exist in this country.  It is not one way that we just want to make money out of people, no, it is both ways, we want to give value back to the people and ensure our benefiting from all this.

What is your dream and vision for Zain Bahrain?  How do you want to see Zain in five years time?

My personal dream is to see Zain Bahrain in the hearts of all my customers here in Bahrain.  My personal dream is to transfer this mobile service today into a bouquet of services which really helped all our customers to actually live their lives in a faster and more efficient way.  My personal dream is to see that we have added value to every single customer which is on our network and we have also really taken a bit of out of their heart.  We can offer of the state of the art technologies.  I can tell you that my personal dream would be to get x amount of market share, launch x amount of services, etc.  But without the customer and touching on people, this doesn’t work.  So my real personal dream is that this mobile really becomes part of the lifestyle of the customer.  The telecommunications is really adding and adding more values to the customers.

Why has the Zain group chosen Bahrain as its headquarters, and what are the key advantages it offers?

Bahrain really has the most to liberalized telecommunications environments within the region. We have spoken about the advantages of competition here in Bahrain, we have spoken about the regulator. From one perspective you really find a healthy environment to be in.  On the second aspect of that, Bahrain offers good investment opportunity for all companies.  Bahrain has a lot of flexible policies which allow any company to come in and actually operate very easily.  From setting up a company which is the first milestone, the rules and regulations in place are really healthy enough which would allow you to do actually start up. You talk about being a hub, an international company with accessibility, flights in and out, you really have a lot of flexibility based on the location of Bahrain within the region and there are no complications.  You talk about immigration policies.  They are very flexible in those terms, which give you a good environment. You name it, there are very good ingredients here in Bahrain for a foreign investor to actually come in and set up here. The success rates are high with the rules and regulations, whether it’s on the banking side, the telecommunications side, etc, the competitive environment here is great versus other locations. So I think the country has a lot of flexibility and advantages which allow it to be one of the most attractive places to set up. For telecom and banking you have a good taste of customers here who actually appreciate you.  So the ingredients are great and it is a good place to set up.