“If you ask anyone today in Russia what MegaFon is, the vast majority would say it’s a mobile operator. Would they be right? Yes, especially if you look back at the last 25 years, which is how long we have existed as a brand — a brand that it would be no exaggeration to say is a household name in Russia.
But would it be right to call us a mobile or telecom operator when talking about today? Or when talking about what MegaFon will become in future? Probably not.
Our company helps people communicate, ensuring high quality voice services and the fastest mobile internet. With the most extensive network in Russia, we are always there with our clients and MegaFon is available in even the most remote corners of the country.
We rarely think about it, but what yesterday seemed impossible, is today part of our lives. Technology has changed, and along with it our requirements and habits: we expect that any service, any information and the possibility to see, obtain, read, listen to, send and save it should be available anytime, anywhere. And it’s doesn’t matter if we’re talking about photos from a certain event, a like on social media or a financial operation.
MegaFon has changed with technology. Today we are not just a telecom operator. Step-by-step we are becoming an operator in a much broader sense: an integrated digital communications company.
It sounds imposing and serious but what do we actually mean? Let’s have a look.
When we talk about communication, we mean the entire spectre. Communication means interaction between people, the fabric on which any society is based. There are many tools for human interaction, from the personal, close and trusted form, through to mass communication, reaching millions.
Communication tools are constantly developing — from inscriptions on clay tablets to letters, radio, telephones and telegraphs, TV, text messages, chats and email. Thanks to new technology we have cut the distance between cities and countries to fractions of a second.
The most popular means of communication today are social media and messengers. Tomorrow there will probably be new ones that we possibly can’t even imagine yet. Whatever they are, we will work with them. Today the MegaFon group includes Russia’s largest internet company, Mail.ru Group, which owns the largest Russian-language social networks, Vkontakte, Odnoklassniki and Moi Mir. Mail.ru Group products are used by 90% of Russian internet users each month. Together with Mail.ru Group, we are working to create radically new digital services for our clients, uniting our communication capacities with the resources of a major internet company. So clearly we are much more than just a high quality mobile channel; we are a digital communications company in the broadest sense.
But why digital and integrated communications?
Because the focus of our attention is digital clients. Today they comprise roughly a third, tomorrow they will be the majority and in the not-too-distant future everyone will be a digital client. These clients are smartphone owners, active mobile internet users who communicate through messengers, social media and prefer online services to traditional “paper-based” ones. People for whom a smartphone or tablet connected to the internet is their main method for communication with the world, allowing them to be mobile and have access to the information they need anywhere.
Aside from voice services and the fastest mobile internet, we are ready to offer such clients services that make their life more convenient: helping them instantly find out the news from their phone, share information with friends, order a taxi or lunch to the office, buy cinema tickets or watch a film on the go. We believe that the future lies in integrated solutions that not only unite mobile services, social media and the possibility to communicate and share information with services but also creating unlimited opportunities to interact with each other. Interaction with others is, essentially, what makes up our lives and human society overall.
We are changing with a transforming world and providing new opportunities. We are becoming an integrated digital communications company. Over the next four years we will work to do this better than others and to become the first choice for clients in Russia”.
Our strategy is called Driving the Digital World
Mission: Providing Opportunities
Vision: Your first choice and partner for life
Aim: Drive an increase in client Lifetime Value (LTV). This means encouraging a rise in revenue from clients throughout the entire period of their interaction with MegaFon by offering the best and most useful services that cover every aspect of their life.
We believe that to return to growth, the telecommunications market needs to stop competing on price. We will work to make sure that our digital clients are satisfied with our offerings and service, that they understand the value of our products and spend as long as possible on the MegaFon network and use a large amount of services.
*As of Q1 2017, 32% of MegaFon’s client base was digital clients.
Our competitive advantages:
Given successful implementation of our new strategy, our management aspiration is to achieve average annual growth up until 2020 of 2 — 5% for group level revenue and 3 — 6% for OIBDA. Our target debt to OIBDA ratio is 2.0.