Tag Archives: telecoms

Mobile subscriptions fall in Tajikistan

FEB. 10 2017 (The Conway Bulletin) — Mobile phone subscriptions in Tajikistan fell 22% in 2016 to 8.7m, the telecompaper.com website reported by quoting industry data. The drop is likely linked to the sharp economic downturn that has hit Tajikistan and its neighbours over the past couple of years. It relies heavily on Russia to power its economy but the Russian economy has tipped into a recession because of a fall in oil prices.

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(News report from Issue No. 316, published on Feb. 10 2017)

Telia CEO promises sale in Kazakh, Tajik, Uzbek markets

JAN. 27 2017 (The Conway Bulletin) — The CEO of Swedish mobile operator Telia, Johan Dennelind, said that he was confident that he would be able to sell off the company’s remaining assets in its Eurasia region this year. Interest in Telia’s regional asset which include Azercell, Geocell, Ucell, Kcell and Tcell have been light. A corruption scandal in Uzbekistan, linked to a 2008 bribe, triggered the sale.

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(News report from Issue No. 315, published on Feb. 3 2017)

Revenues at Kazakh mobile operator collapse as mobile users feel economic chill

ALMATY, JAN. 27 2017 (The Conway Bulletin) — Kcell, Kazakhstan’s biggest mobile operator, felt the full force of the regional economic slowdown in 2016 with revenues falling 12.7% to 147b tenge ($444m), its lowest since 2009.

Kcell’s annual reports are important because they provide one of the few open and accurate insights into how Kazakh companies are handling a sharp economic slowdown triggered by falling oil prices and a recession in Russia.

The company, which is part- owned by the Kazakh government and part-owned by Sweden’s Telia, also said that a drop in profit margin had reduced its overall profit by 41% to just over 31b tenge ($94.5m).

In a statement, Kcell CEO, Arti Ots, admitted that 2016 had been tough.

“2016 was extremely challenging for Kcell, although at the end of the year we saw early signs of market stabilisation,” he said.

“As we move into 2017, there are positive signs of economic recovery in Kazakhstan, with an easing in consumer price inflation and indications of growth in the economy.”

A collapse in the value of the tenge, economic stagnation, job losses and a fall in vital remittance values all hit the Kazakh economy in 2016.

The specific improvements that Mr Ots referenced include a boost to revenues from demand for contract phones which has fed through into a third consecutive quarter of revenue increase.

“We are now seeing a positive interconnect balance with revenue exceeding costs and we expect this situation to continue in 2017,” he said.

The details of Kcell’s financial results also reflect the turbulence of the Kazakh economy, including rising inflation. Kcell said that costs had risen by 19.2% in 2016 to nearly 11b tenge ($33.5m). A spokesperson for the company said that some of this cost increase was triggered by a rise in staffing costs at new outlets.

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(News report from Issue No. 314, published on Jan. 27 2017)

Kazakhstan not to regulate telecome prices

JAN. 18 2017 (The Conway Bulletin) — The authorities in Kazakhstan have decided not to dictate telecoms prices this year, the telecompaper.com website reported quoting Kazakh sources. The authorities had considered interfering in the competitive Kazakh market, which has been characterised by price drops. Telecompaper.com said that the decision would make Kazakh telecoms companies more competitive in the Eurasian Economic Union.

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(News report from Issue No. 313, published on Jan. 20 2017)

Kazakhstan not to regulate telecome prices

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(News report from Issue No. 313, published on Jan. 20 2017)

Sweden’s Telia accuses Tajikistan of slapping it with bogus tax bill

JAN. 17 2017 (The Conway Bulletin) — Telia Company, the Swedish telecoms company, accused the Tajik government of posting a bogus tax claim against its Tajikistan-based subsidiary Tcell.

In a statement, the head of Telia’s Eurasia division, Emil Nilsson, said that the tax authorities in Tajikistan had handed Tcell a claim for May 2015 to June 2016 of 155m somoni ($19.6m) — more than the company’s entire revenue for 2015.

“We are very concerned with the situation which we believe is totally unacceptable,” Mr Nilsson said.

Central Asia governments have previously tried to raise revenue by slapping large fines for tax violations on Western companies. And this is exactly what Telia, in its abrupt statement, said was the scenario currently playing out with the Tajik authorities.

“The Tajik operator Tcell has appealed what is considered to be an illegal tax claim,” it said in the statement entitled ‘Telia appeals illegal tax claims in Tajikistan’. “The authorities in Tajikistan are basing their tax claim on revenue that Tcell has never generated, so called ‘un- realised revenue’.”

The Tajik authorities may feel that Tcell is vulnerable. Telia is trying to offload its businesses in Central Asia and the South Caucasus after a corruption scandal in Uzbekistan was uncovered that tarnished Telia’s global image and damaged Central Asia’s reputation for governance.

In September 2016, Telia agreed to sell its 60% stake in Tcell to the Aga Khan for $39m. The Aga Khan already owns 40% of the company.

In its statement, Telia said that it had expected the deal to be signed off by the Tajik authorities by the end of 2016. This has been delayed, though, without clear reason, Telia said.

The Tajik authorities have not commented on either the tax-linked fine or the delay in granting permission for Aga Khan to buy Telia’s stake in Tcell.

Tajikistan’s economy has been hit hard by a recession in Russia, making finding potential buyers for Tcell difficult.

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(News report from Issue No. 313, published on Jan. 20 2017)

MTS revenues in Armenia and Turkmenistan drop

NOV. 18 2016 (The Conway Bulletin) — Russian telecoms company MTS published its first quarterly report after discontinuing operations in Uzbekistan, posting a 1.3% decline in revenues in Q3 across its operations in the former Soviet Union, compared to the same period last year. In rouble terms, revenues in Armenia were down 19% to 2.1b roubles and in Turkmenistan they fell by 17% to 1.2b roubles.

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(News report from Issue No. 306, published on Nov. 25 2016)

Uzbek telecom expands coverage

NOV. 22 2016 (The Conway Bulletin) — Uzbekistan’s state-owned telecoms operator UMS said it has expanded coverage of its 3G network to the provinces of Ferghana and Namangan. UMS installed 56 new base stations that will boost coverage both in the cities and in the rural areas. Central Asian countries have invested heavily in improving mobile connectivity across their territory.

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(News report from Issue No. 306, published on Nov. 25 2016)

EBD sends loan to Kazakh telecom

OCT. 28 2016 (The Conway Bulletin) — The Kazakhstan/Russia-led Eurasian Development Bank sent a 4b tenge ($12m) loan to Transtelecom, Kazakhstan’s telecoms network, to improve infrastructure ahead of the upcoming EXPO2017 event in Astana. Earlier in October, Nurali Aliyev, grandson of President Nursultan Nazarbayev, said he had bought 49% of Transtelecom in 2015. State-owned railway company Kazakhstan Temir Zholy owns a 51% stake in Transtelecom.

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(News report from Issue No. 303, published on Nov. 4 2016)

VimpelCom says that price inflation boosts profit in Uzbekistan

TASHKENT, NOV. 3 2016 (The Conway Bulletin) — Russian telecoms operator VimpelCom said revenues in Uzbekistan grew 5% in Q3 2016, compared to the same period in 2015 because of a new pricing mechanism and underlying inflation.

In Uzbekistan, VimpelCom started to link its mobile charges to the US dollar, after volatility in the Uzbek sum hit the company’s revenue stream. This pushed up mobile and data prices plans across the country. It said that average user revenue had risen by 14%.

Tougher competition, however, shrank the customer base of Vimpel- Com’s Beeline brand in the country.

“The Uzbek market continues to experience intense competition, however Beeline remains the leader.

The overall customer base decreased 6% to 9.6m, due to the launch of two new mobile operators in 2015,” the company said in a statement.

Subscribers numbers had fallen below 10m at end-2015, a 3-year low. Earlier this year, VimpelCom paid a fine of $795m after it admitted paying bribes in 2007/8 to access the Uzbek mobile market.

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(News report from Issue No. 303, published on Nov. 4 2016)