Saudi telecommunications operator STC (Saudi Telecom Company) has been a pioneer for decades in terms of championing revolutionary new technologies that have transformed the daily lives of Saudi citizens. It is in their DNA to embrace change and to deliver cutting-edge innovations and solutions that ultimately enhance the quality of life in the Kingdom of Saudi Arabia.
At its core, STC is an innovator and has continued its tradition of adopting a progressive mindset towards the development and deployment of emerging transformative technologies such as 5G. It has once taken the lead on next-generation technologies in Saudi Arabia and become one of the first operators in the Middle East to commercially launch 5G last year.
STC plays such an important role in the ecosystem of the development of Saudi Arabia that it has been identified as being a ‘key enabler’ in the ambitious Saudi Vision 2030 program.
The project is the brainchild of the Crown Prince Mohammed bin Saman who believes the radical transformation program will help the country become a hub of technological innovation. He recognizes that the country must become less dependent on oil revenues and thus needs to diversify its economy. The objective of Saudi Vision 2030 is to achieve that goal.
Telecom Review managed to secure an interview with STC’s dynamic and visionary CEO Nasser bin Suleiman Al-Nasser in an effort find out more about STC’s plans regarding the launch of its 5G networks.
In a fascinating interview, STC’s CEO provided us with a comprehensive oversight on its journey with 5G so far, and what it is going to be working on in its efforts to commercially deploy the technology on a nationwide basis in the forthcoming years.
In addition to this, Al-Nasser highlighted how 5G can create new verticals for operators which can generate new revenues for them to offset the losses they’ve suffered due to the rise of OTTs. Healthcare and Transport are two areas he highlights in which he believes will be valuable 5G use-cases.
He also discusses in detail STC’s DARE strategy which is closely aligned with that of the aspirational objectives of Saudi Vision 2030. He believes this new blueprint will help STC become a world-class digital leader and will help them propel digital transformation in the MENA region.
STC is one of the first operators in the world to launch a 5G network. Where are you in the technology/network development so far and what key lessons have you learned from this early commercial deployment?
STC always prides itself for being first in launching new services and pioneering technological innovation and advancement. STC has the required capabilities, the necessary skill-base and the critical international partnerships to enable it to pioneer our market.
Indeed, STC was one of the first operators in the region to commercially launch 5G, on the 15th of May of last year as soft launch. This was the result of huge efforts in studies, trials, partnerships and worldwide collaborations.
In order to achieve this, STC has partnered with three major international vendors to build the first 5G network in the Kingdom. STC’s objective was to deploy 5G technology on commercial basis by Q1-2019. To address the Spectrum issue, we are utilizing the 3.5 GHz spectrum band, as an initial step forward.
STC is also developing its existing Core and Transport network, to serve the 5G network requirements. Our ultimate objective is to get the best possible user experience, and to reach cell throughput beyond any limit that we have experienced to-date.
STC has definitive and ambitious plans to extend coverage to more extended areas in KSA, within a 3-year time span. So far, we have deployed an early pilot network to provide an initial experience with this new technology. We are mainly looking at “Fixed Wireless Access” as our first 5G service to end customers. Yet, we are working with different industries to develop new use cases.
After the success of launching the 1st 5G network in SA, When can Saudi enjoy the 5G experience?
We are proud to uphold our technology leadership position in the region by being the first to launch 5G technology. Industry players across the value chain from chipset, handset, software, and hardware manufacturers to service providers are all excited about the potential value that 5G and related ecosystem will bring to multiple industries and to the society in general.
5G technologies will be a key enabler for industry 4.0 that promises to revolutionize value chains across the industries. Enhanced spectral efficiency, low latency, higher throughputs, and network slicing benefits of 5G technology will enable use cases across multiple industries such as manufacturing, transport and logistics, health, retail, education, security and others.
For STC, there are three main considerations in our planning towards commercial 5G availability:
1. 5G technology standardization has made very good progress.
2. Devices availability.
3. Commercial demand and readiness for applicable use cases.
We are closely monitoring industry developments and working with our partners on the technology as well as commercial side. Devices availability is expected this year. It is also important for us to consider our 5G deployment strategy that balances re-use existing investments, new revenue streams, prioritization based on commercial benefits and financial returns, and competitiveness, while minimizing risk.
As the devices start to become commercially available, initially we are starting to deploy fixed wireless broadband solutions including IoT use cases, followed by deploying targeted mobility coverage, scaling coverage, and then focusing on industry scale advanced IoT solutions that require low latency and high throughputs.
Technology and demand side ecosystem readiness will take some more time. However, 5G is high on our agenda as evident from our ongoing activities and engagements. STC is well positioned to ensure that our region is among the first to reap benefits of 5G technology on commercial scale.
Can you elaborate more on the ambitious STC DARE strategy?
STC has based its new strategy on the aspirational directions set by KSA Vision 2030, strong desire by shareholders for significant growth, revolutionary changes in the telco industry, and on the company’s existing strengths and capabilities.
This new three to five year STC strategy, launched under the name ‘DARE’, will see the company pursue growth by moving into new businesses, while simultaneously protecting and growing core telecoms assets. For STC, ‘DARE’ is both an aspirational roadmap towards the future and an internal call to embrace change.
STC’s aspiration over the next 5 years is to substantially grow and diversity its portfolio. This goal will be achieved through expansion in both our geographical footprint and our portfolio of businesses.
Our aim will be to selectively pursue value-creating opportunities to pioneer the digital transformation of KSA and the MENA region. STC has set forth its vision to become a world-class digital leader providing innovative services and platforms to our customers and enabling the digital transformation of the MENA region.
The ICT industry is changing rapidly and value is shifting upstream towards digital services. Across many digital segments, winner-takes-all becomes a reality. This implies that a successful player will have to do two key things: evolve towards a digital player and strengthen capabilities across multiple if not all segments of the value chain i.e. infrastructure and connectivity, platforms, and digital services.
Explaining the four themes of DARE, (D) – Its strategy stands for digitization of internal processes and creating a data driven organization, and developing agile delivery platforms i.e. IT and Network. This will be a key enabler for rest of the strategic pillars. In addition, it will also improve productivity and deliver significant operational savings.
(A)- Our strategy entails accelerating performance of our existing assets i.e. extracting more value – profitable growth - from what we already have. This includes generating new revenue streams, as well as capital and operating efficiency focus.
The (R) theme is about reinventing customer experience and a customer-first culture across everything we do. This includes improving customers’ quality of experience, digitizing customer sales and other customer touchpoints, and improving brand perception.
The (E) theme is the growth engine of our ambitious strategy and focusses on expanding both scale and scope of our business. As part of the growth pillar, STC’s leadership has decided to further strengthen its positon in connectivity and infrastructure space through geographical expansion and creating new businesses such as its tower company.
On the platform side, we are investing in IoT, Cloud, Cybersecurity and other enabling platforms. On the digital services side, our focus is on media and advertising, digital financial services, and further strengthening our positon in IT services.
Other than the digital sector, what other major sectors has STC entered for providing its advanced cloud computing capabilities?
Part of our strategy goals is to maintain growth in building world class data centers not only in KSA but in the MENA region. Data centers will help us grow retail (enterprise and consumer) as well as wholesale business in public and private sectors.
Data center hubs are like a cornerstone enabling multiple aspects of the digital transformation journey that we as STC and KSA economy are embarking on. Our platform strategy for Cloud services, IoT services, Cybersecurity, and e-Government services will be enabled by these data centers.
Similarly, the digital services such as IT services, media and advertising, and digital financial services will make use of the storage, switching, and networking capabilities that we are building in these data centers. Data centers will also support the implementation of virtualization and automation of our core networks required for deployment of IoT solutions and 5G networks. We have built the largest area stack cloud in the region with many use cases.
We have launched the first-of-its-kind radiography platform (Enterprise Medical Imaging) in the Kingdom, in collaboration with the Ministry of Health at King Fahd General Hospital in Madinah.
Beyond 5G and digital transformation, what are the main challenges STC is facing across its operations for example, business, technology or both?
STC is the largest and leading telecom operator in the Middle East. Therefore, it will be naturally impacted by many of the factors affecting the global telecom business. Our main approach is to ensure the best possible customer experience with the network.
We will make sure that our infrastructure is ready for the future services and applications, and will deliver to customer expectations and new services requirements. Our biggest challenge is shared by all global operators, and that is: to make sure we have the correct and optimal business model in order to monetize the new services and ensure a sustainable return on investment.
This applies to 5G as well as other services. From a technical viewpoint, we are also governed by the international standardization of technology and the maturity of devices eco-system. This prominently applies to 5G and cloud technologies.
Despite all these challenges and constraints, I must assure you that STC is steering its future developments with confidence and clear vision. We have full appreciation of these challenges and have put forward safeguards to guarantee best possible outcome for STC.
What do you expect to be the main talking points at MWC2019?
MWC is one of the leading organizations that motivate and inspire technologies and solutions. It brings together most of the expertise and specialized people for all over the world. This year’s event comes at a critical timing for telecoms as the shift towards 5G and digitization gathers more momentum and becomes reality.
This definitely creates distinctive excitement in the market place. I believe this year’s event will be dominated by the evolution towards new services and the monetization of network infrastructure. This includes:
- 5G and its potential use cases
- Collaborations and partnerships
- Network cybersecurity and the way to tackle threats of all kinds.