Mongolia is experiencing a wonderful period right now with 17.3% GDP growth and projections of 12.5% this year. Obviously, the world is really looking at the Mongolian economy right now. A lot of people have stated that infrastructure is going to be one of the major challenges for Mongolia, which includes energy, road transport, railways and telecoms in particular. What does the future look like for the telecoms sector here in your opinion?
Mongolia’s ICT sector has been growing very fast since the middle of 1990s. Mobile phone penetration has grown to 116.4% so competition is very high. In recent years, mobile phone subscribers have grown to be much more sophisticated, demanding better customer service and better products to help them simplify their lives. With the growing economy we expect that consumer demand for innovative products and services will grow, therefore the need to introduce next generation technologies will rise.
The number one mobile operator in Mongolia is Mobicom. Unitel have got a very aggressive marketing campaign which they have been continuing for several years. How are you looking to maintain your position within the market? How are you going to continue being the number two player in the market, and how are you going to increase revenue per user?
Our experience in this sector and support from partners, coupled with being more innovative and creative, suggests that Skytel
is well positioned and set to grow. Following our company’s mission we will deliver smart products and services to our customers.
We will change our employee attitude and the company culture, which we have already started to do in 2012. In addition, given our new management team, the changes to our organisational structure, and a renewed focus on the fundamentals of our business – particularly friendly and effective customer service – I am confident that Skytel will be Mongolia’s leading mobile operator in the near future.
Along with our emphasis on the latest technology, we are also placing greater attention on customer service, opening new customer service branches, revamping our customer service training, and communicating our marketing messages that are simple and acceptable by the market. In this regard, we have retained the services of an outside consulting group, Victors Mongolia Leadership, to overhaul our internal and external communications as well as to improve our customer service training program. It is a very exciting time at Skytel and we are already beginning to reap some of the benefits from our change management program.
Mongolia is very spread out and there are many remote locations. How does Skytel plan to satisfy demand for telecom services in these areas? What do you feel most needs to be addressed in order for this sector to evolve?
We have deeply analysed the business situation for Skytel over the past period in order to expand our coverage to the rural areas. Current penetration rate in rural areas is very low for Skytel, just 20%. Although, experience says that the penetration ratio for the sector in these areas and the capital city is 50:50, which reveals the need to expand our business in rural areas. This year, we rolled out a CDMA 3G technology network in all the provincial centres and in some large numbers. For Skytel, broadband services are our future business so we are focusing on this area for both rural and urban markets. We are happy to provide high-speed internet services, and we will continue to deploy WCDMA technology networks. We also plan to open additional service branches nationwide.
Skytel is now a 100% Mongolian-owned entity. Do you think 4G will come to Mongolia any time soon?
Yes, you are right. Skytel is a 100% Mongolian-owned national mobile service provider and we have opportunities and advantages relating to stable investment on the technology side. We are actively looking at 4G now and we plan to roll out these services. It is important for Skytel to deploy next generation technologies, as the results will bring us opportunities for equal competition in the market, which will derive from the elimination of technology differences. Our target is to start launching 4G from 2014.
In terms of partnerships with mobile technology vendors, how do you think new technology will adapt to the Mongolian people? You mentioned that the mobile telecom industry here is very young. Do you have any schemes coming up to show Mongolian people, especially those living in rural areas, the power of a mobile phone and everything they can do with it?
Every year we are increasing data usage in Mongolia and users are requesting increased data speed and data broadband services. Currently, most of our revenue comes from CDMA voice and other traditional services. There is however a general trend in Mongolia, same as global trends, that data services created from broadband, IPTV, WIMAX services and 4G technologies will become the main revenue drivers in the near future.
You have been in this sector for many years and are viewed as one of the professionals of Mongolian telecom industry. As a Mongolian, what do you think will be the biggest hurdle you will have to overcome over the next few years?
Who is making the decisions quicker? Whose customer service is better? Whose product is better? Who is innovative and creative? Who adds value to its customers? Who is most cost efficient?
The business concept must be win-win.
There were elections last year, and you now have a new prime minister and cabinet. As a private-sector businessman, what are your expectations for the new government?
I believe that the government should support the private sector, aid to its growth and not compete with it. 97% of telecom traffic and 70% of its revenue is generated by four mobile operators and they all pay considerable tax contributions to the government. I expect the new government will ensure fair competition in all sectors.
As a national company, you have got a huge responsibility as you employ so many people and you generate so much wealth here. How does Skytel give back to the Mongolian people and do you engage in any CSR activities or are you working with any foundations to help those people in need?
When I worked at Mobicom, the CSR activities were focused on education, and Mobicom has implemented various programmes, such as the School Lunch Meal initiative in 2006 and E-learning programme in 2010. Now, here in Skytel a new CSR direction has been adopted which is focused on preserving nature. 80% of Mongolian land is facing the danger of desertification, which is crucial to Mongolian people’s future. We chose it as our new CSR direction as desertification is one of the greatest environmental challenges today and a major barrier to meeting ecological and human needs in dry lands. We are working on several environmental programmes and to reflect this, A green colour is included in Skytel’s logo. Our environmental programmes include a conservation project that promotes green technologies in order to decrease power consumption. We also have a waste management project where we have started collecting old phones, batteries and recycle them, as they are very harmful for the environment if disposed improperly. Programmes related to animal and steppe land protection have also being planned.
If we were to come back to Mongolia in 25 years’ time (for the 75th anniversary for UK-Mongolian relations), where would you like to see this company? What changes would you like to make, and what vision do you have for this company and this economy?
I am confident that Mongolia’s economy will continuously grow and so will the telecom industry. I want Skytel to be number one. I am very ambitious and I believe that all businessmen should be ambitious and visionaries.
What message would you like to send to international readers about Mongolia?
Mongolia’s reputation is growing worldwide very fast and there are many economic opportunities. We used to be known across the world for Genghis Khan, and now for our natural resources. Business in Mongolia is growing rapidly and Mongolia is open to foreign investment. We need to introduce international standards, and best business practices and tools. Here in Skytel we are starting to implement ISO standards.
Twenty years ago Mongolia has adopted a market economy. Although many businesses have grown in this business environment, we still need to learn from international experience and I believe Mongolian companies are open to foreign businesses to create valuable partnerships.