Introduction to ArtificiaI Intelligence in Higher Education
Du assignment.
1. Emergence of a New Telecom
Operator In A Monopoly market
Of UAE: DU
2. In February 2006, du received its integrated provider license at
a cost of AED 124.5mn, thereby ending Etisalat‟s near 30-year
monopoly on the provision of telecom services in the UAE.
DU offers mobile and fixed telephony, broadband connectivity and
IPTV services to individuals, homes and businesses. It also
provides carrier services for businesses and satellite up/downlink
services for TV broadcasters. Above all it also offers value, while it
continues to deploy state-of-the art technology to keep enhancing
its services. By October 2011 over 5 million people and over
40,000 businesses have chosen to use its services and become its
customers. As a rapidly-growing enterprise it has over 2,000
staff working to enhance and expand its bouquet of service
offerings. The UAE (United Arab Emirates) is one such country
where the 30-year monopoly of Etisalat was ended with the entry of
a new player, du.
Company Overview
Emirates Integrated Telecommunications Company (EITC) became
the UAE‟s second integrated telecom provider in December 2005,
owned by:
the UAE Federal Government (50%),
Mubadala Development Co. (25%),
Emirates Communications and Technology Co. (25%).
EITC then acquired from TECOM Investments the assets, capital
and businesses of a number of its subsidiaries, including an initial
fixed-line subscriber base of 19,100 business and consumer
customers.
The UAE Telecom Regulatory Authority awarded EITC the nation‟s
second universal telecom license (20-year validity) in February
2006, at which point EITC unveiled its operating brand name, du.
In April 2006, 20% of du‟s shares were listed on the Dubai Financial
Market in an IPO oversubscribed by 166 times. The company
launched domestic mobile services in February 2007, and by the
3. end of 2007 claimed 1.5mn mobile customers and 46,000 fixed-line
subscribers, yielding a market share of 19% by management‟s
estimate.
Vision of du
To enhance your life, anytime, anywhere.
Mission of du
It wants to delight its customers, be the employer of choice for the
best talent, create optimal value for its shareholders through
business excellence and innovation, and proudly contribute to the
transformation of itscommunity.It works to deliver its vision by
using its talent, skills and energies to connect, inspire and reward
all it touches, every day.
Values of du
We are Confident, Friendly, Honest, and Surprising, and our
values guide our actions.
The du team:
4. Board of Directors/Management team
du’s diverse and experienced management team is dedicated to creating
a better experience for all du customers.
Ahmad Bin Byat Osman Sultan
Chairman Chief Executive Officer
Andrew Grenville David Holliday Yatinder Mahajan Farid Faraidooni
Executive Vice President Executive Vice President Executive Vice President Executive Vice President
(Enterprise Division) (Consumer Division) (Carrier Services Division) (Corporate Affairs)
Mark Shuttleworth Fahad Al Hassawi Sameer Sadeh Clint Goad
Chief Financial Officer Executive Vice President Chief Innovation Officer Executive Vice President
(Human Resources) (Technology Innovation) (Technology)
Raghu Venkataraman Hamid Husain Rashid El Sheikh Anneliese Reinhold
Executive Vice President Vice President Vice President Vice President
(Corporate Strategy and (Information Technology) (Procurement and (Legal)
Strategic Marketing) General Service)
Hala Badri Ananda Bose
Vice President (Corporate Vice President (Corporate
Communications) Programme Management)
Telecom Sector worldwide
5. Over the last two decades, the telecom industry world over has
grown and evolved at an incredible pace and has considerably
changed the way people interact. Although, fixed line is still the
most penetrated telecom segment; wireless or mobile segment has
been the key contributor over the last decade, offering a wide
range of opportunities to provider and services to customers.
Today, there are more than 4 billion mobile phone users worldwide
and this number is expected to reach 5 billion in coming years. The
shift of revenue from fixed to mobile and from voice to data is
accelerating. Apart from its social and cultural impact on modern
society, telecom industry is one of the significant contributors of
world economy with an estimated 3% of the global GDP. Driven by
strong mobile and broadband penetration in emerging markets and
substantial economic recovery in developed markets, global
telecom industry is expected to see double digit growth over the
next four to five years.
UAE Telecoms Sector: A “Du-opoly”?
The United Arab Emirates telecommunication sector is now worth
AED 977 million or about $266 million based on Q1 estimates by
market research firm GfK (GesellschaftfürKonsumforschung
(Society for Consumer Research Germany)
The figure represents a 30% increase over the same quarter last
year, with the value of the UAE telecommunication sector remaining
in the AED 700 million ($190 million) range for most of 2009 before
recording the jump earlier this year.The rise is credited to
burgeoning demand for smartphones in the country.
GfK's research also shows that the smartphone market has
overtaken the traditional mobile phone segment in terms of value
for the first time, growing 47% quarter-on-quarter.In the
smartphone sector, the touchscreen segment grew by 58% in
value, followed by QWERTY phones with a 26% value rise
6. The table below sets out a range of main indicators specific to the
UAE telecommunications sector for 2010:
UAE
Fixed Telephony
Indicator Service Mobile Service Internet Service
Subscribers 1,460,985 10,926,019 1,374,903
Revenues(Billions, AED) 3.2 18.4 2.7
Voice Minutes (Billions) 4.3 21.6 Not applicable(n/a)
ARPU (3) (Monthly, AED) 184 140 166
AMPU (4) (Monthly, Minutes) 248 165 n/a
Source: 2010 Industry data,
(3)ARPU : Calculated by dividing the total revenues for a given period by the average number of subscribers during such period 6
(4)AMPU : Calculated by dividing the total minutes for a given period by the average number of subscribers during such period
7. DU OPEARATION
Du business mobile services provides a host of business and
entertainment features with single structured billing, mobile
roaming , closed business user group, competitive calling rates
coupled with preferred international destinations and power -Bill for
added convenience to businesses across the UAE.
Mobility solutions such as BlackBerry and Mobile Data extend the
reach of business processes beyond the conventional boundaries;
accordingly du enables business professionals to connect and
access business data while on the move and from anywhere. du
voice solutions offer an array of value-added services as well as
premium reporting and billing options for inbound and outbound
voice traffic. Business contact centre, hosted voice, call select and
several other solutions are also part of the product portfolio.
du‟s internet & IP access solutions namely MPLS, IPLC, DLC, IP VPN
and broad band services, are designed to provide reliable data
connectivity for domestic and international business. Managed
business TV services include a wide range of TV content solutions
suited to commercial and hospitality industry customers. Managed
Services aim to enhance the business value of IT investments
through improved operational efficiency and service levels ,
enabling customers to manage control over IT operations as
required, while staff focuses on core business .
To stay ahead of competition, the fully integrated telco places
customers at the centre of its strategy. Offering business customers
high-touch account management with industry expertise to
proactively consult and advise specific businesses on how to best
utilize communication resources. Professional services offers pre-
sales technical consultancy, complete project management,
implementation and support, performance management and service
auditing to enable businesses take the right decisions at every
stage of the business life cycle.
Designed for sophisticated and complex business needs, du offers
dedicated service professionals with vast knowledge and experience
to tailor the best telecommunication solution. This is further
bolstered by exclusive business customer support , offering top
8. quality multilingual round the clock service support to ensure that
requests and queries are fulfilled within the agreed service levels.
UAE telecom market lacks competition
The UAE telecom market lacks competition but customers are
seeing some improvement in the number of services offered by
the country‟s two operators.
Du was launched in 2006 as part of a government plan to
boost competition in the telecommunications sector but delays
in infrastructure and number portability deals have failed to
create value.
A shared infrastructure deal with Etisalat, which would allow du
to reach areas that could not be accessed before for fixed line
telephone, internet and television services, is being hammered
by technical glitches.
Prices are significantly higher in Dubai then they are in Qatar
and this is due to lack of real competition.
There is competition in what is happening to customers; every
day there is a new offer, every day there is new offer of getting
value for money, there is competition from the customer point
of view.
Diversification:
Du, is shifting its focus from growing mobile market share to
increasing subscribers to its data package services.
The operator, which currently has a 44 percent share of the
UAE mobile market has subscribers to data package services is
increasing four-fold,.
Despite the shift in strategy there is no reason why du cannot
9. overtake its competitor, Etisalat, in terms of market share.
Dubai-based du, which broke Etisalat‟s monopoly in 2007, has
steadily been gaining market share but mobile subscriber
growth is slowing down, making data services increasingly
important.
The firm in August said its mobile phone subscriber base had
increased by 171,100 in the second quarter to 4.8 million,
while fixed-line customers grew 25 percent to 623,600 lines.
The network currently has five million active customers in the
UAE.
Subscribers to the operator‟s data package services are
quadrupling.“
Customer interest due to price
100 du
80
60
40
20 both
Etisalat
0
10. VOIP- a threat to uae telecom:
Voice over Internet Protocol (VoIP)-a revolutionary technology, it is
a combination of hardware and software that enables companies,
organizations and individual users to use the Internet as a
transmission medium for telecommunication. In VoIP both
technology and services are involved where the Internet protocol is
a technology which is using a common computer network and
transmission as a service. The VoIP mechanism is different from the
traditional phone system. In VoIP analog audio signals human voice
converts into digital signals and then these audio digital data
transmitted over the Internet in the form of data packets. The
Internet plays a major role as a backbone in VoIP communication
system. Following are the key factors which come in favor of VoIP
Technolygy over Public Switched Telephone Network PSTN.
Reduce communication cost
• Multiple users
• VoIP-Hardware and software
• Reduced administrative cost
• Improved manageability
• Increased flexibility
In UAE Etisalat and Du are two main telephone and Internet
services provider. Currently most of the business users and home
users are making international calls either from Etisalat or from Du
and VoIP in UAE is legally not allowed. On the other hand it is no
denying a fact that the large number of people are still using VoIP
from different source like Internet cafes, homes etc. The major use
of VoIP in UAE is mostly for cheap international calls through the
Internet using software like Skype, SweetCalls, FreeCalls, IntVoIP,
VoIPWise, etc., with relatively cheaper rates. Most of the VoIP
software use Virtual Private Network (VPN) for example, Hotspot
shield, Smart surf, KongShare etc., where these VoIP
communication packets can transfer through VPN tunnel and that
make it easiest and safer way for making international calls and
Etisalat or Du are mostly not able to chase these kinds of VoIP data
packets.
11. Skype and all other major VoIP services are completely blocked in UAE. There are
however some ways to get around. User can use a VPN hosted in foreign countries
and just connect to that VPN. So effectively all voice call traffic is carried on the
VPN server and user can use VoIP from UAE. Etisalat and Du are trying their best
to block the known VPN and the new VPN are emerging to facilitate Etisalat and Du
users to connect to them and use the VoIP services and this hide and seek game is
going on.
Telecom Liberalization - WTO Driver
The liberalization of the UAE telecoms sector is driven by the UAE‟s
membership of the World Trade Organization (WTO), which it
joined in 1996. In 1998 a total of 69 member countries agreed to
open their telecommunications sectors to competition, under the
WTO Basic Agreement on Telecommunications. The WTO aims for
the global telecom sector to be completely liberalized, free from
monopoly or government protection by 2010.
However, the UAE negotiated concessions and, under current WTO
rules, its deadline for complete telecoms market liberalization has
been extended until 2015. The telecoms sector in the UAE is
regulated by the Telecommunications Regulatory Authority (TRA).
Telecom Regulatory Authority: (TRA)
The UAE‟s Telecom Regulatory Authority was formed in 2003 with
the aims of:
i) building and implementing a regulatory framework to foster and
facilitate competition between telecom operators in accordance with
World Trade Organization stipulations, and
12. ii) helping meet the federal government objective of turning the
UAE into a regional ICT hub by developing training institutes and
encouraging research and development.
The TRA is funded through license and spectrum fees as well as
government funding via royalty fee payments.
The TRA granted licences for companies offering various telecom
and IT services such as satellite services and Public Access Mobile
Radio based on its licensing framework as per the UAE Federal Law
by Decree No. 3 of 2003 – Telecom Law. Currently there are six
licences that have been granted to different companies: Etisalat,
du, Nedaa, Al Yah Satellite Communication Services and Star
Satellite Communications Company.
Key Regulatory Policies in Place
National Roaming: The TRA requires Etisalat to offer roaming
services to du on Etisalat‟s own mobile network. As du continues to
expand its own mobile network infrastructure, it is becoming less
reliant on the roaming agreement. We understand du is still
utilizing a limited amount of Etisalat‟s network in the western and
middle regions of the UAE.
Mobile Number Portability (MNP): Initially MNP was planned to
be introduced at the same time as du launched its mobile services,
but its introduction has been delayed. The TRA has now stated that
it intends to introduce MNP in 2008. If this is implemented on the
basis of full number portability, including the prefix carrier code
(i.e. 050 for Etisalat, 055 for du), we believe this will be have a
material impact in determining market share and subscriber
growth. However we believe telephone number are “sticky”.
Without full number portability, users may be deterred from
changing their operator because of the inconvenience of having to
inform all their existing contacts of a new telephone number and
the potential cost of having to changing business cards and other
stationery.
13. Voice-over-Internet Protocol (VoIP): VoIP is allowed to be used
on private telecommunication networks, i.e. corporate networks,
but not to make international calls or calls to other networks. This
means use of VoIP services like Skype, Net2Phone and Vonage are
banned in the UAE. Under their license terms, both Etisalat and du
can provide VoIP services to the public, but neither operator
provides such service nor has indicated they will do in the future.
We assume that the UAE‟s ban on VoIP services such as Skype will
continue for the time being. VoIP services were accessible from the
free zone areas serviced by du, but have been blocked recently as
du complies with the TRA policy on VoIP.
Interconnection: Until recently, du enjoyed an unofficial
monopoly of fixed-line services in most of the areas colloquially
known as „New Dubai.‟ Within most New Dubai areas,
Etisalat‟sinternet, voice telephony, and TV services are delivered via
du‟s infrastructure. At the same time, du relies heavily on
Etisalat‟swireline infrastructure for outgoing voice and data traffic
from New Dubai.
Carrier selection and pre-selection: Under TRA regulations,
fixed-line carrier and pre-selection is allowed and has been
implemented by du, while Etisalat in the process of implementation.
Once implemented fully, we could see users taking advantage of
du‟s cheaper peak time international charges. This should
encourage Etisalat to lower its international call rates.
