Summary Bullets:
• Etisalat by e& is making moves to share its expertise with telcos across the world that may not be able to afford next-gen B2B services.
• Etisalat by e& will look to increase its B2B credentials through a network of partners beyond its operational footprint without having to go through complex M&As.
UAE telecoms incumbent Etisalat by e& (e&) has launched its new business program called ‘e& Partner Networks.’ The move is an attempt by the operator, which is sitting on large piles of cash reserves, to increase its influence on the global stage as a credible B2B partner.
The company is no longer satisfied with focusing on its geographical operational footprint, which extends to 16 countries across APAC and MEA. Acquisitive investments, in spite of any due diligence, have been a hit-and-miss for most major telcos in the Middle East region. This new Partner Networks program allows e& to extend its influence without having to go through complex corporate investments in regional territories that might not make much business sense as well as offer its in-house expertise via secondments of e& personnel and an allocation of its resources.
As much as the benefit it can bring to partners, the deal also benefits e& for building up its own expertise and competitive edge in the enterprise and B2B sectors. The company cited resilience and becoming future-ready when announcing this program.
Judging by the type of operator e& will want to seek partnership with, it is expected to be challenger telcos with pockets not as deep as the incumbent and with a strong desire to diversify into B2B services. GlobalData expects these companies to be situated in Africa, Asia, and Europe. E& claims it can offer its partners the requisite expertise in customer engagement and value management; sales channels; pricing and proposition support; AI and ML modeling; international carrier and wholesale channels; network procurement; CapEx and OpEx optimization; and digital financial services. E& will want to fill in a space that has been traditionally beyond the reach of the major telco groups in both the East and the West. Whereas telecoms operators are the natural and primary targets of the program, non-telcos cannot be ruled out either.
According to GlobalData Senior Analyst Rob Pritchard, global telecoms alliances are notoriously difficult to deliver. Historic joint ventures (JVs) like Concert (i.e., BT-MCI then BT-AT&T), Global One (i.e., Deutsche Telekom, France Telecom, and Sprint), and UniSource (i.e., KPN, Swiss Telecom, Telia, and Telefónica) all failed in their quest for global domination. Multiple JVs for national reach have also failed – largely because the equity involved had failed to secure strategic control and customer focus. Nevertheless, there is potential merit in any alliance that provides benefits to the parties involved. The mantra should be ‘quid pro quo or no go.’ Recent national JVs have, however, proved more successful (e.g., Vodafone-Ziggo in the Netherlands and Virgin Media O2 in the UK) as they share a common goal and complementary assets.
Intriguingly, e& has been growing its investment in Vodafone (i.e., 12% of its equity), with Vodafone active in 47 markets indirectly through what is often an underappreciated partner network. That opens up the hypothetical prospect of joint partnership activities with e&, especially now that Vodafone’s strategic focus is on European and sub-Saharan African markets. Thus far, nothing has been announced along these lines (difficult given that Vodafone is changing its CEO), but the potential for a broader partnership is obvious – perhaps with a greater geographical focus for each player on Europe and MEA respectively.
IT Connection 