The Business Year

Richard Shearer

AZERBAIJAN - Telecoms & IT

Aiming For The Goal

CEO, Bakcell

Bio

Richard Shearer graduated with a degree in Accounting and Finance, and is a member of the Chartered Institute of Management Accountants. He joined Bakcell as CEO in 2011, and had previously held many top positions in the telecommunications sector in the US, Asia, and Europe, at companies including Cable & Wireless in the UK, DiGiTelecom in Malaysia, and CCO at T-Mobile in the UK, as well as Empower Interactive Group, and BTC Mobile in Bulgaria. He has been working in telecommunications for 28 years and has worked and lived in 25 different countries in most of the major regions of the world.

TBY talks to Richard Shearer, CEO of Bakcell, on the company's portfolio, demand for smartphones, and sponsoring Manchester United.

The ICT sector in Azerbaijan is historically competitive. How would you characterize your portfolio of current clients as a result?

Bakcell has always seen its customers, first and foremost, as its primary asset. Our customers have a thirst for new technology, great service, and a great brand experience. In 2014, customers are beginning to live the strategy we put forward a couple of years ago, to take people’s use of the internet from information and email to entertainment. There has been a rise in videos on our network and the number of smartphones is increasing dramatically. Upwards of 60% of our clients use data services in one form or another. Customers are interacting and using their phones in more complex ways, so there is a much greater involvement with the service and brand. That can open access for customers in terms of information, entertainment, and how they interact with people. It is a much more comprehensive engagement than simply buying a phone, sending a text message, or making a call. We have an overall younger customer contingency than Azercell, for example. Those customers are much more mobile savvy, more internet aware and, in many ways, are much more demanding. They expect us as an operator to be able to help them navigate the internet and discover new services, the coolest apps to download, and the best phones to use. All of that is part of the brand engagement.

At the moment, what is the current demand for the smartphone that you released?

We are seeing significant demand for the Bakcell branded smartphone. We already launched our third smartphone, and we started last September with a lower function version. We split that with a larger screen, the ALOV phone, and there is an entry level, which is called Ilk. In splitting that market, we timed it almost exactly at the same time as Apple. We have been able to push smartphones into the regional areas where Ilk is popular. ALOV phone, which is a bigger screen format, has proven to be a lot more popular in Baku, as a second smartphone. For customers, in line with everywhere else in the world, screen size is defining experience and so we see customers who are going through their second-generation smartphone will typically purchase ALOV.

Bakcell has an important partnership with Manchester United. How has that developed in the past year?

It is a three-way partnership with Manchester United and the Association of Football Federations of Azerbaijan (AFFA), and Bakcell. One of our key themes is development through sport, so we do a lot of development of sports talent—primarily football—with AFFA, and we have done the Manchester United Soccer Schools for two summers. They were really successful touring around the country and doing open trials. After being selected, participants came to Baku for a series of coaching sessions with Manchester United coaches. It was so successful that a fulltime school has been established in Baku, together with AFFA, and it is one of only two schools outside of Manchester, the other being in Hong Kong. It has been a successful initiative in terms of investing in younger talent, sport, and all the lessons that youngsters can learn through sport. It is becoming part of the fabric of society here. We accept 64 kids, who are the best players. We have one full-time trainer from Manchester United and two assistants, one is a professional coach from AFFA, the other is an assistant also from AFFA.

The development of the non-oil sector is fundamental, especially now that the oil price has fallen. What role can ICT play in non-oil sector development?

There are two primary roles: firstly, as an enabler—since without a strong ICT infrastructure, most businesses will not get off the ground, survive, or thrive; the other is as an investor and employer. Bakcell is one of the largest investors in the non-oil sector, and we are also one of the larger employers. Bakcell group employs well over 11,000 people, and we do that also with Azerconnect, which is our subsidiary. From this, we see our role as drivers of innovation, investment, employment for people in the sector.

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