Feature Article

June 21, 2013

As Voice Declines, Kazakh Operator KCell Sees Hope in LTE Service

Recently, Telecoms.com managing editor James Middleton interviewed Kazakh operator KCell’s CEO Ali Agan, who replaced the outgoing chief Vsal Aral. Agan has risen through the ranks of KCell’s parent company TeliaSonera Group, and most recently was the CEO of Ucell.

Because Agan does not see any future for voice, he is focused on driving data usage and next generation technologies like LTE in Kazakhstan, where most consumers are still using 2G services and 3G adoption is limited. 

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 “Even though we are still generating most of our revenues from voice, data is definitely the future,” Agan said. “So we will do everything required to expand the data business and increase data quality. This will be mainly through 3G but I’m also interested in getting into 4G.”

The CEO believes that Kcell will benefit from the experience of its parent company TeliaSonera Sweden as it was the first commercial LTE operator in the world. Plus, the experience at Azercell, where Agan launched 3G and 4G services, will be helpful in expanding LTE in the coming years, stated Agan.

Presently, Agan said that KCell is in the process of obtaining a 4G license. However, with 3G, the data share of revenue at KCell is 13 percent, according to Agan. But, his plan is to increase that share of revenue as there is enormous appetite for data in Kazakhstan.

“Although the biggest share of revenue is coming from voice today, tomorrow data will be the biggest contributor. So we need to invest in coverage of broadband,” Agan told Middleton.

Meanwhile, the Kazakh operator is asking the government for a timescale on LTE license allocation. However, the interview indicates that no such date has yet been set.

Agan is confident that LTE technology will have a positive impact on the operator’s average revenue per user or ARPU. Concurrently, the CEO also envisions growth for LTE as 50 percent of the population is under 20 and GDP on a year on year basis is growing. As a result, he is not concerned about new tariffs, products and services. The CEO believes that the young demographic of the country will rapidly adopt LTE from service provider that support KCell network.

Edited by Alisen Downey

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