Exclusive: Du's CEO On Price Cuts

Callers from the UAE can expect lower rates in the near future, said du’s top official.

Calls from the UAE to, say, India (at Dh2.1 per minute) today are nearly double the cost of calls to the UAE (or Dh1.17 per minute). “Lower tariff rates are part of the natural evolution of the telecom sector,” Osman Sultan, du’s CEO, told XPRESS in an exclusive interview.

We take complaints very seriously. If we promise something to our customers or we’re late, or there are frustrations, we have to compensate them. Osman Sultan, CEO du

“There are two ways of offering more value. Either you get more for what you pay, or you pay less for what you get. We are doing both. It is a progressive thing. It’s not an on-off switch,” he added.

Expatriates form nearly 80 per cent of the UAE’s 4.1 million population, of which an estimated 1.5 million are Indians. A Dh25 card only lasts 12 minutes when making a phone call from Dubai to New Delhi.

All call tariff rate adjustments in the UAE must be approved by the Telecommunications Regulatory Authority (TRA).

Publicly, both the dominant carrier etisalat and newcomer du said they will not engage in a price war.

“It is not only what du is bringing to the market, but the effect that du is bringing on etisalat, which is very important – and the best evidence that competition is working.”

Pay-off from competition is starting to show in people’s bills, said Sultan, who is also the chairman of the Arab Working Group for the Private Sector in the International Telecommunications Union (ITU).

Before he joined du, Sultan headed MobiNil, which he helped set up in 1998 in Egypt.

Three months from its commercial launch, du announced it had exceeded the 400,000-mark for its mobile phone subscribers. It currently has about 30,000 fixed-line connections, but the company is poised to expand its landline service before the end of this year.

He also revealed du is now testing a prototype of WiMax, which could turn entire cities into internet “hot spots”.

ON COMPETITION

• It’s certainly a challenge, but it’s also very exciting. People are expecting the company to do in just 11 months or one year what took the other 13 years to do.
• We’re working constantly to enhance and expand our mobile network coverage. Every day, we have more cell sites going on air. The coverage has been expanding rapidly.
• People are comparing etisalat’s network that took many years to build with ours. We knew that. So we just keep on pushing and pushing. We came to the market competing with a very established company. But we came with a lot of firsts.
• People’s patience is very tight because they compare us with etisalat. That’s the name of the game and we accept it. It involves a lot of good efforts from a lot of bodies. We work closely with municipalities, utility companies and government services to ensure this roll-out is something that is ongoing. Sometimes there are obstacles.

ON FACING A THIRD TELECOM FIRM

• We won’t be doing our job if we don’t set du to be prepared for more and more competition. It’s a fact that competition will be increasing in a sector like telecom.

ON DU’S WORKFORCE

• We now have more than 1,600 people, including call centre and technical support. We’ll have about 2,000 people before the end of this year.
• Some people from etisalat have approached us. But we didn’t think poaching people would be the proper way of doing things. We are here to give a momentum to the telecom sector, not to distort it.
• We believe we can create our own corporate culture. We wanted the type of competencies we bring on board to reflect the diversity that the telecom world is experiencing now.
• Building our retail network was also a challenge. From day one, our customers could buy post-paid products from about a hundred outlets and our pre-paid shops from more than 1,000 shops across the nation.

ON CUSTOMER COMPLAINTS

• We did face some complaints. It happened in the beginning when we faced a big demand following a successful number booking campaign. We came up with something unique. We decided to have free home delivery through courier service. That created some delays. It’s a logistical issue. There were delays with some SIM card activation. But things are much smoother now.
• We wanted to be very honest. People are frustrated. I think it’s just fair that we add Dh100 credit to people who faced delays with their SIM card activation. We can’t just ask people to understand.
• We take complaints very seriously. If we promise something to our customers or we’re late, or there are frustrations, we have to compensate them.

ON LANDLINES AND INTERNET

• Customers will be able to use du to make fixed-line phone calls nationwide before the end of this year. I’m not saying it’s a rollout plan. I’m saying this will be a possibility for customers.
• Interconnection is already there, but there have to be rules on infrastructure sharing. I don’t know how it will work. But this happens in other countries – the possibility of using or optimising the use of existing infrastructure.
• Of course, VoIP (Voice over Internet Protocol) is on the table. But we will obey and fit completely as a licensed operator into the framework laid down by the authorities mandated to set the rules for us. 
• I do know customers want more value, better prices. Competition will play at all levels, including price. We’ve shown this through the per-second billing.

ON PRICE CUTS

• Phone calls from the UAE are not very expensive. If you can benchmark the rates within the region, the UAE’s call rates are on the lower end. But people want cheaper phone call rates.
• It is clear that tariff will see an evolution. At du, we are committed to ensure we offer more and more value. The more customers we have, the more we are able to offer more value. That will happen. We intend to continue to offer more value.
• International phone call rates have been going down progressively. There will be a progressive downward trend to continue the existing tariff adjustments, but I can’t say whether it’s this year or next.

ON DU’S RELATIONSHIP WITH ETISALAT 

• Our relationship with etisalat is a competitive relationship. But it’s not a fierce one.
• Do I look like I’m afraid? I think our campaign shows we’re coming out with a very confident approach. But on the other hand, we rely on etisalat for some aspects because they provide infrastructure.
• We have responsible people on both sides collaborating in some aspects for the good of the sector.
• These are two professional companies working in the same sector. I am paid to ensure that our company will do better. It’s my job to ensure this competition is strong and vibrant. On the other hand, I have a great deal of respect for etisalat.
• In some areas, we would have loved things to go faster. But in all honesty, etisalat has been cooperative.

ON NEW TECHNOLOGY

• At my home, I’m using a du broadband WiMax access to connect to the internet. It is a prototype version. We are testing it. It’s just one of the technologies we’re looking at. We are testing it in different areas – Jumeirah, Dubai Media and Internet cities, Deira. The idea is to go into
  a more commercial type of testing.

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