Overview
Aggressive subscriber acquisition activity and heavy investment in further extending the network ensured that MTN Irancell exceeded its performance targets. Promotions and a cut in the price of prepaid starter packs helped ensure a significant increase in total subscribers. Together with enhanced product and service offerings, improvements in customer care and wider distribution, this helped drive mobile market penetration.
ARPU per month declined slightly despite the sharp increase in subscribers, while aggressive cost control initiatives, in particular, tight control of commissions, headcount growth and marketing expenditure, helped keep cost increases in check.
MTN Irancell continues to benefit from a strong brand, helped in part by customised advertising in local dialects in areas where Farsi is not the primary language. MTN Irancell also received the local tax award for its exemplary compliance with tax regulations.
Market environment
Iran did not escape the effects of the global economic slowdown while the social unrest put further pressure on economic activity. There has also been a delay in issuing the third GSM licence in Iran.
Infrastructure
MTN Irancell kept up its strong investment momentum to enhance the quality, coverage and performance of its network by substantially increasing its coverage of cities and towns and almost doubling its road coverage.
Between the three outsourced network build vendors MTN Irancell activated new base transceiver stations (BTS) at an impressive monthly rate. A significant number of these were brought on air in Tehran, helping to enhance network quality. Further enhancements remain a priority, as do site acquisitions, particularly in the main cities.
MTN Irancell became the first operator to launch WiMax technology successfully in, by providing wireless data transmission services.
Products and services
The Company continued to enhance its value proposition to customers and maintained its reputation for innovation with the launch of numerous new products and services. One of these, Ring-back tones, allows subscribers to select a tune to play to their callers, proved to be especially popular. Initiatives such as these help to reduce churn and improve brand awareness.
Distribution
MTN Irancell worked to ensure wide distribution and availability of its products, with the addition new distributors. Among the various methods of buying airtime in Iran are via ATMs, logical points of sales, web kiosks and internet banking.
The dealer footprint has been significantly enhanced and MTN Irancell noted a sharp improvement in the collection of customers’ registration documents from dealers in the year, thanks to the installation of the necessary systems at dealerships to make this easier. Dealers have moved away from only selling SIM cards and airtime and now offer an increasing range of services to ensure an enhanced customer experience.
The Post Office was added as another distribution channel for MTN Irancell products and an additional work shift was introduced at the MTN Irancell service centres, extending trading hours and ensuring greater customer convenience. MTN Irancell’s call centres have achieved their highest service level and answer rate since the inception of the business.
People
The Company continued to bolster training through the MTN Academy and put considerable effort behind skills transfer to local employees. A new staff benefit package was also introduced a number of temporary employees were converted to permanent staff, thereby assisting its efforts to retain a motivated and competent employee base.
Regulatory environment
MTN Irancell is pleased to report a number of positive developments on the regulatory, including: the signing of a memorandum of understanding on interconnection, and agreement of an interconnect rate; the award to MTN Irancell of a WiMax number range; the clearing of spectrum interferences in major cities; and the granting of a GSM number range to the Company. The authorities also published draft number portability regulations.
Outlook
While the growth in MTN Irancell has been remarkable, the Company continues to strive to firmly entrench its position versus a well-established competitor and the entry of a third operator. MTN Irancell will work on further improvements to its network quality and coverage, and has earmarked capital expenditure particularly for the main centres of Tehran and Esfahan.
The full commercial launch of WiMax is expected to open up the broadband market for MTN Irancell, providing a strong competitive position. Among a number of other planned product launches, the Company expects to introduce dynamic tariffing as well as MTN Mobile Money to its Iranian customers.
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