ICT 2020: STC’s new focus

By Linda Xu

Saudi Arabia has one of the world’s highest penetration rates when it comes to smart phones, social media, and online platforms.  As the nation’s largest carrier, STC is evolving from a traditional telco into a full-fledged digital enabler. The company is creating value for different verticals with innovative ICT solutions under the belief that an intelligent, flexible, and agile network infrastructure is the key to digital transformation. STC Group CEO Dr. Khaled Hussain Biyari told us what the carrier’s ICT 2020 transformation strategy is all about.

Forging ahead with Network 2020 

Transformation is a must…

One of our aims is to make STC the leading ICT player in the region. At the start of our transformation journey in 2013, we introduced major programs to improve our corporate culture and work environment. We also initiated one of our largest ever projects: transforming our IT and business support systems. 

In 2015, despite an industry-wide slowdown, our consolidated revenue and EBITDA were up 11 percent and 3.8 percent respectively over 2014, confirming the success of our transformation programs. Over the next three or four years, operators will be delivering technologies that fundamentally change society. 5G coupled with a world connected by the Internet of Things will see operators become more important to enterprises and consumers. By 2020, networks will inevitably face a level of demand and strain that they’ve never seen before. Telcos also need to worry about how to stay relevant in 2020.  

From infrastructure to apps…

Moving towards Network 2020, operators are transitioning to an All-IP world where they will provide more relevant and enriched communications services for customers, create revenue opportunities, and secure long-term shareholder value by leveraging the interconnectivity of an All-IP network. 

The transformation process exists in four layers. At the bottom sits the innovation layer, which can link you with your R&D centers. The second layer is infrastructure. Next you have what I call the enablement layer, which consists of all enablement platforms, including cloud, machine to machine, IoT, and cyber security. Finally, the fourth layer houses applications for different industries. 

In STC, we’ve invested heavily in the first three layers, with a clear focus on partnerships, especially on the application layer to ensure we find the best partners for every vertical. So, we’re marching along well, and I think we’ve got what it takes to be a major player in this digitization era.

Setting the pace of new tech

When 4.5G is ready…

In our largest market, Saudi Arabia, the take-up of the latest technologies is unmatched. We witnessed an exponential growth in data consumption when we introduced 3G, and then 4G, largely due to social networks. Now, we’re starting to deploy 4.5G. 

With 4.5G networks and the major role they play in pushing video content to customers, video services will become even more popular in Saudi Arabia ─ the nation already ranks first in the world for YouTube views. So, it’s crucial to work with partners to deploy new technologies like video, which consumes huge amounts of network resources; for example, installing CDN is extremely important if you want to optimize where traffic is going through the network. We’re planning to aggressively promote M2M applications now that latency is no longer a bottleneck, and we’re looking at more advanced technologies to enable these applications for our customers.

For digitally savvy young people…

Around 65 percent of Saudis are under the age of 30, and the population is getting younger. This has led STC to adopt new approaches to better meet the evolving needs of young, digitally savvy customers. The millennials of today’s Saudi Arabia exemplify the ongoing shift in consumer behavior and expectations. They live in an always-on, real-time world, and expect companies to cater to them in the same way.

In May, we launched Jawwy, a new digital mobile experience that places us as one of the first telecommunications operators in the world to design and develop a new mobile experience that uses online and social media. Jawwy features its own SIM, app, and freshly designed digital channels for sales and customer care. A key differentiator of the service — the Jawwy app — will allow users to build, share, and manage their plans in real time, instead of buying fixed plans. The app also offers many unique features including real-time contextual offers and notifications, and a simple way for customers to activate services without calling customer support or visiting a store. 

The app will be available for both iOS and Android. The service has been in private beta testing since December 2015. Jawwy is a significant part of STC’s current digital transformation and we believe this initiative will set the pace for the telecom sector in KSA and beyond. We believe it’s the future of mobile.  

Clouds above the new blue ocean…

According to IDC, more than a third of Saudi organizations have invested in cloud services. The cloud market in Saudi Arabia is expected to grow 44.5 percent year on year in 2016 to total US$63 million, as an increasing number of end-user organizations migrate non-core workloads, including productivity, collaborative projects, sales and marketing, and human capital management to the cloud. 

We developed and began executing our cloud strategy in late 2014, and our cloud services enable customers to log on and choose the kind of services they want. We’ve been actively promoting cloud services mainly to SMEs because cloud is the logical choice for them to optimize their IT operations, both from a cost and efficiency perspective. Moreover, we signed an MOU with one of the region’s leading government departments to provide cloud services for the public. As a result, we’re at the forefront of cloud services in the region.

Moreover, STC has launched cloud marketplace to become a platform for other ICT players to host and sell their services via STC. This will create an ecosystem of cloud services provided by a network of cloud services’ partners locally and internationally.

All-round support

A word on regulatory bodies…

Competition in Saudi Arabia's mobile market has increased significantly, and we’re seeing a rise in data consumption of more than 250 percent in a year. It’s very important to reduce regulations that don’t add much value, particularly during network transformation. In addition, the huge expansion of network infrastructure requires the right level of spectrum allocation on one side, but the regulatory framework shouldn’t constrain us in terms of how we can package and sell our services on the other.

With Huawei…

STC has partnered with Huawei across a number of development fronts. These aim to enhance customer experience and optimize OPEX by better understanding customer needs and wants, and ultimately winning customer loyalty by creating more value than ever before.

Over the years, Huawei has proven to be a valued strategic partner of STC. That’s why we’re teaming up with Huawei to implement our greatly ambitious Network 2020 plan.