Since launching Lebara in the Kingdom in late 2014, you have primarily targeted migrant communities with pay-as-you-go SIM cards. Can you tell us more about your positioning in the market?
Our business model, launched in 2014, was intended to target expats and was a strategy driven by our partner Lebara. This proposition allows us to approach our target market in a better way. Any mobile service provider will focus on a segment that can give it the most revenue per user. The expat population gives us volume instead of high revenue per customer. When we started with a focused market, we had an advantage. We did not have large assets in the beginning, and this strong focus was a key reason behind our early success. Now, we have just finished our first five years of operations. This knowledge of the market has given us an ability to focus on not just expats but middle- and low-income groups of foreign nationals, both male and female. They need to manage their daily and monthly communications requirements, whether voice or data. When you give the customer control, they really enjoy it. This is exactly what we are offering to these groups of consumers.
Middle Eastern mobile markets have relatively high entry barriers for Mobile Virtual Network Operators (MVNO). You have, however, succeeded in capturing a significant market share. How did you succeed?
This has not been an easy path. In the Middle East, it is difficult to launch companies such as ours. When we started our operations, the host network saw us as competition, not a partner. It was difficult to convince them, which we had to do through the growth in our business. However, we are not taking market share from them. In fact, we are helping them increase their own market share and revenue. This took a long time, and we have only managed to develop an understanding with our host providers in the last year or so. Saudi Arabia was the first in the Middle East to offer an MVNO license. Now, after five years of operations, we are seeing other GCC countries offer these licenses. They have seen the success of this model in Saudi Arabia and are interested in recreating it.
In August 2016, you launched the first Mobile Virtual Network Enabler (MVNE) in collaboration with Huawei. How has this service advanced since then?
This service is a real differentiator for us. There are two types of MVNO: light or full. Light MVNO is focused on sales and marketing. By having this other platform, we are able to have more control. We can manage and define the product to a much greater degree. We managed to get the system up and running in the middle of 2016. Since the implementation of this enabler, our key performance indicators have rapidly changed. When we developed this platform, we made sure we were able to do multiple MVNO services so we could connect with multiple MNOs. We are extremely dynamic now whenever there is a market opportunity and really able to shape our own future.
What is your vision for the IT transformation of the Kingdom, and what role can Lebara play?
Digital transformation is crucial for us and for telecoms and mobile services. We have seen many ambitious plans from the government for smart cities, traffic control, agriculture control, and security control, all of which require IoT. We plan on operating in the IoT space, but in a specific direction.
What are your strategic priorities for the year ahead?
Our ambitions are all driven by the goals of Vision 2030. We are working through success and survival. We can see the impact on every service provider in Saudi Arabia when it comes to technology development. Every space is being positively impacted because these new technologies reduce overhead costs. In 2019, the government approved the e-commerce law. Many businesses are either adapting to the new law or establishing new operations. Saudi Arabia's retail environment will go through dramatic changes in the next year. The introduction of 5G started in 2019, but we will really see its impact in 2020. We will also see new uses that will enable sectors we never before considered to automate some of their daily operations, which will also help different sectors—in particular, health. Elder care will change, and so will chronic disease care, and there will be many new business uses.