BAKUTEL - ICT SECTOR IN AZERBAIJAN

 

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BAKUTEL - ICT SECTOR IN AZERBAIJAN

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ICT is Azerbaijan's second most profitable sector after hydrocarbons. It is also the second largest recipient of FDI after the oil and gas industry. The Networked Readiness Index ranks Azerbaijan far and away as the leading country in the CIS for connectivity at all levels. The government is fully behind ICT's continued growth, an indication of the importance of this industry to the country's future. At present, ICT contributes 6% to the country's GDP; in 2009, that figure was 5%. The future is brighter still, projected to increase to 9% by 2020, with an average YoY growth of 18-20%, creating $8 to $9 billion for the national economy. More than $2 billion has been invested in IT since 2010, and with healthy returns—revenue increases around 30-35% each year. More skilled engineers, better training, and a culture of innovative SMEs will all contribute to ICT's expansion to the next level. The government has supported recruitment in the industry, and there are now 29,600 people directly employed in ICT, up from 25,000 in 2012.

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Telecoms The telecoms sector is overseen by the Ministry of Transport, Communications and High Technologies, which regulates the various telecommunications companies and promotes and manages investment in the sector. The re-structuring followed an energetic few years for Azerbaijan's ICT sector. The official Year of ICT kick-started recent development in the sector over the course of 2013. The Year of ICT raised the profile of the industry at home and abroad and gave the government a platform from which to launch vital investment and upgrading programs. In this way, 2014 saw two key developments set in motion. The first of these is the National Strategy for Information Society Development (NSISD), which runs from 2014 to 2020 and is a successor to the National ICT Strategy 2003-12, which saw deep reforms of the sector. The NSISD is also the ICT sector's contribution to the overarching vision for Azerbaijan 2020, whereupon the country is due to reach targets across its economy. The NSISD is divided into two distinct stages. The first runs from 2014 to 2017, and will see the building of an information society and the effective adoption of ICT at all levels of society. Central to this is the e-government endeavor, which seeks to have all key government services functioning entirely online. NSISD is a serious commitment—the government plans to invest billions in the sector before 2020. In 2014-15, the State Fund awarded grants to 53 start-up projects in software, applications, R&D, high technology, and in such fields as air navigation and e-payments. Grants range from $12,000 to $382,000. The second initiative is the State Fund For Development of Information Technologies. The Fund’s objectives are as following; ‐ provision of financial and technical assistance to entrepreneurs in the field of ICT ‐ the attraction of domestic and foreign investment to ICT sector ‐ the integration of new technologies to the domestic economy ‐ the facilitation of partnerships in projects ‐ conducting feasibility and other type studies on projects by involving both local and foreign experts ‐ the provision of easily accessible, low interest rate credits to small and medium size enterprises operating in the field of ICT the provision of grants to people (both natural and corporate) for specific projects. http://ictfund.gov.az/?page_id=1373&lang=en Project Trans-Eurasian Information Super Highway (TASIM) is a project of regional importance, whose aim is laying a transnational fiber-optic line covering the countries of Eurasia from Western Europe to Eastern Asia. The project envisages the creation of major transit link from Frankfurt to Hong Kong. The line will combine the major centers

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of information exchange in Europe and Asia. The transit line will stretch through China, Kazakhstan, Azerbaijan, Georgia and Turkey to Germany. Reserve North transit line will pass through the territory of Russia, Ukraine and Poland. The Ministry of Transport, Communications and Information Technologies of the Republic of Azerbaijan (MCIT) initiated the project TASIM on the sidelines of the 14th International Exhibition of Communication and Information Technologies (Bakutel) during the ministerial meeting in Baku in November 2008. TASIM project will contribute to create open information society in the region, to increase the speed of Internet connection and the development of Internet services, which, in turn, will lead to economic development, diversification of the economy and increased competition. http://www.tasim.net Mobile telecoms With a market penetration of 110%, the mobile segment has reached saturation levels, with more than 11 million mobile lines actively in use in 2014—almost 2 million more than the entire population of Azerbaijan. The number of fixed, or land, lines stood much lower, at 1.82 million— just 15 main lines per 100 members of the population. Since 2010 there have been more mobile phone subscriptions than people in Azerbaijan. Azercell was the first national GSM operator in the country and is a subsidiary of TeliaSonera, the Swedish telecoms group. Launched in 1996, Azercell now has a client base of 5 million subscribers and 56% of the total telecoms market. The remainder of the mobile telecoms sector is formed of mainly two companies: Azerfon and Bakcell. Bakcell was established in 1994. Bakcell was the first to activate 4G roaming services for its subscribers in 14 countries around the world shortly after the operator had launched its superfast LTE mobile internet.

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Internet Internet is central point of making Azerbaijan the ICT hub of the Caucasus region. Compared to the relatively staid landline service in Azerbaijan, the internet is racing ahead. Fixed broadband is now connected in 69% of households, with others depending on dial-up modems or mobile connections. Just over 76% of the population has personal access to the internet—almost twice the global average. In 2014, Azerbaijan lanced a fiber-to-home strategy to increase broadband takeup to 85%. This has been supported by the State Oil Fund of the Republic of Azerbaijan (SOFAZ), which provided $131 million, with the project implemented in partnership with Aztelekom. Fixed ICT per 100 inhabitants, 2016 year Mobile phone subscribers Internet users Computer users One of biggest foreign investors in the internet has been Alcatel-Lucent, active in the country since 2007. The company works in partnership with the government to supply equipment and technology. Other important foreign companies in the ICT development field are Caspian Telecom, Cisco, Oracle, Nar Mobile, HP, Caspian Navtel, Sazz, and Ultra. Azerbaijan International Telecom (AzInTelecom) is the first independent body in Azerbaijan in the field of international accounting system of communication was established on March 1, 1994 as a structural division within Aztelecom Production Association by order № 13 of the Ministry of Communications dated February 7, 1994. In the organization of exchange of international voice telephone traffic, the activity of AzInTelecom LLC is signing of contracts between Azerbaijan and telecommunication operators of foreign countries, in terms of geographic and network creation and operation of international telephone channels through alternative routes, exchange of international telecommunication services and optimization of routing, organization of

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voice traffic, conducting inter-carrier mutual settlements of accounts for these services, as well as implementation of cooperation with International Telecommunication Union (ITU), International Telecommunications Satellite Organization (ITSO) INTELSAT and EUTELSAT and other international organizations. http://www.mincom.gov.az/ministry/structure-of-ministry-of-communications-and-hightechnologies/azerbaijan-international-telecom-azintelecom/ Space technologies “Azercosmos” Open Joint Stock Company (OJSCo) is the only satellite operator in Caucasus established on May 3rd 2010 and fully owned by the government of Azerbaijan Republic. Having launched the Azerspace-1, the first-ever satellite of Azerbaijan, on February 8th 2013, the company provides highly reliable, satellite-based communication services to enterprise and government customers for DTH, voice, video, data and mobility applications. With the advanced design and flexible switching capabilities of the Azerspace-1 telecommunication satellite, millions of viewers are able to get an access to information and communications services worldwide. Azerspace-1 plays a role as an important gateway in a joint space that connects more than 50 countries in Central Asia, Europe, Africa and Middle East. Strategic development plans of the company include enhancing the coverage area and spectrum of services by launching the second telecommunications satellite Azerspace-2 at 45° East longitude in 2017 and a very high resolution optical Earth observation satellite in upcoming years. “Azercosmos” OJSCo holds an ISO 9001:2008 certificate issued by Bureau Veritas in January 2013 http://azercosmos.az/en/

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