Saad Al Barrak, the former chief executive of Zain Group of Kuwait, says telecom operators need to up their game to take on Google and Apple.
Middle East telecoms firms have been 'game watchers'
Telecoms operators have remained in a comfort zone for too long and need to quickly catch up with the likes of Google and Apple, which have encroached on their market, warned a former chief executive.
These operators "have been game watchers and not game changers," said Saad Al Barrak, the former chief executive of the Kuwaiti telecom operator Zain and founder of three-year-old Ila Group. And it's high time they change to compete with Google, for instance, "who are eating the lunch of mobile operators".
Google, Facebook and Skype are all examples of non-operator providers of texting and voice message services.
Mr Al Barrak was speaking on the sidelines of the first BCS IT International Conference in Abu Dhabi yesterday. London-based BCS, which is identified by its acronym, is The Chartered Institute for IT.
Telecoms operators need to figure out fast how to come back to the race and get their fair share of revenues, how to handle exponential growth in traffic, how to retain these customers, how to build brand equity and loyalty, and how to position themselves for the upcoming expected growth in mobile advertisements and machine to machine opportunities, he said.
"By 2016, we expect to have 50 billion to 100 billion SIM cards in the world," Mr Al Barrak said. In comparison, the last 20 years added 7 billion SIM cards.
While SMS, MMS and voice services are the main revenue streams of telecoms operators, machine to machine (m2m) transaction technology that covers both wired and wireless devices is the new niche segment in the age of digital media management.
And m2m applications are expected to generate US$2 trillion (Dh7.35tn) to $3tn between 2017 and 2020, he said. The UAE, which has Etisalat and du, shows promise as competition is good for the health of the sector, he said.
Telecoms operators need to think fast on ways to capitalise on content download, in the same way that Apple pioneered digital music, said Mr Al Barrak, who led Zain Group until resigning in 2010.
Mr Al Barrak oversaw Zain's ambitious expansion that spread its operations across 23 countries in Africa and the Middle East, from when he joined the Kuwaiti company in 2002.
One of his most recognised deals was the $3.4 billion takeover of the Sudanese businessman Mo Ibrahim's Celtel empire in 2005.