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Zain
Ovum, June 2010, Pages: 13
In March 2010, Zain sold its operations in 15 African countries, marking a complete turnaround from its 3x3x3 strategy (initiated in 2002), which aimed at establishing Zain as a global telecoms leader. The sell-off was triggered by the desire of leading shareholders to generate cash, and realize a good return on their African investment. Zain has therefore returned its focus to more affluent markets in the Middle East. However, executing the strategy will be challenging, considering the growing level of competition in some of its core markets and the high penetration level of mobile services. Additionally, the departure of CEO Saad Al Barrak, who was responsible for rapid expansion into Africa, could disrupt operations over the short term.
Zain aims to maintain its technological leadership in the region, and continues to invest in upgrading its network to next-generation technologies such as LTE and HSPA+. A next-generation network will help Zain to expand its addressable market to Internet access, one of the fastest growing services in the region. Zain is also focusing on value-added services (VASs) as a strategy to extract higher revenues from existing customers and counter challenges associated with the growing level of competition.
Zain has an aggressive marketing strategy which was instrumental in it quickly establishing its African operation. Following the sell-off of its African assets, Zain has further increased its spending on marketing and branding initiatives in order to maintain and strengthen its position in the Middle East.
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