Dissecting the Birth of e&: When Vision and Ambition Meet Opportunism

The United Arab Emirates (UAE) has been witnessing consecutive waves of changes to the various constituent sectors shaping its economy. As part of its vision for decades to come, the gulf state is looking to secure a futureproof resilient strategy by unlocking potential economic growth opportunities that will allow different sectors to change, progress, and thrive.

The UAE national innovation strategy and Vision 2021 promote the strengthening of the technology infrastructure and increase investment opportunities for innovation-related projects. The Abu Dhabi economic vision 2030 goes in line with the state’s vision by focusing on economic and infrastructure development, as well as environmental sustainability. Considered as a key element, the telecom sector is seen as the facilitator of economic growth and as one of the strongholds that need to be kept up to date with proper investments in order to maintain the position of the Emirate as the significant telecommunications center in addition to being the world-leading provider of wireless and data services.

The illustrious telecom landscape is embodied by a mobile penetration rate of 186 percent, with more than one mobile subscription per inhabitant, and an estimated quinquennial compound annual growth rate (CAGR) estimated at 3.5 percent. These high numbers mirror the aggressive strategies followed by the operators and the increased investment from the local governments. They also showcase the high importance given to this sector as a cornerstone for the country’s economy.

The telecom market in the UAE is mainly dominated by Etisalat, the oldest communications provider both in landline and mobile domains. It has been recently ranked as the world’s strongest telecom brand operating in 16 countries, clearly the incontestable leading service provider in that sector. The historic Etisalat monopoly status has changed in the last ten years with the emergence of Du, not as a competitor, but as a complementary service provider given the geographical distribution of the UAE area between the two operators. Thus, creating a peculiar balance not typically seen in other countries. Associated with Du is Virgin Mobile, mainly targeting the newer generation of mobile subscribers.

From the Larger Context to the Event Itself

The high importance given to the telecom segment in the UAE and the great potential has reshaped it to become a competitive economic segment that will provide the country with numerous benefits aligned with the aforementioned Emirati vision, namely, in the financial and technological domains. New use cases and avenues to generate profits are created from one side. From another, the telecom infrastructure is kept up-to-date through constant upgrades to preserve the leading role of the UAE in that domain.

And it is from this general context we can understand and appreciate the rebranding of Etisalat as e&. The impact of this event is as resounding as the rebranding of Facebook to Meta, and such is the role of Etisalat in the Middle East and Africa (MENA). Meta’s existence highlighted the importance of the Metaverse as a digital world created based on the advances in augmented and virtual reality. e& emergence highlights the significant change in philosophy in the telecom sector from basic service provision to a more vital role as a central element in the digital transformation mechanism that will touch each and every profit-generating sector.

E &’s “up-conversion” process from a telecom service provider to a broader digital service provider has been defined through the TARGET strategy. Each letter in the TARGET keyword refers to one objective of the new venture. The T refers to” To drive the digital future to empower societies,” A to “Accelerate value generation through innovation and digitization,” R to “Raise capabilities and develop talent across the Group,” G to “Grow business to business (B2B)/digital across the footprint”, E to “Expand portfolio in MENA and knowledge economies” and the T to “Transform operating companies into strongholds.” 

Looking at the dynamics of the worldwide telecom market, the rebranding event can be seen as an opportunistic masterplan. Its sole purpose is to exist as an approach that aligns with some Big Tech companies and other big names in the industry, such as Oracle, Microsoft, Amazon, and Rakuten. The main premise is to exploit the different opportunities offered by the new 5G wireless standard, to diversify their revenue sources, maintain a mere monopoly of the telecom market in their region of presence, and participate in reaching the goals defined in the country’s vision. The perfect opportunism can also be justified by the increasing reliance of today’s enterprises on connectivity and automation and their drive for additional security and reliability. Being a mobile operator with government backing and relatively mature infrastructure, e& can offer trustful and reliable services to various enterprises. It even has the power to provide different B2B opportunities and expand into new vertical markets.  

The once telecom operator clearly understood that an identity change is necessary for the future. By exploring and grabbing each appealing opportunity, the company would be providing its platform as a service (PaaS) and infrastructure as a service (IaaS), thus leading the digital transformation race.

How Is This Done?

Up to this moment, e& is keeping its hands close to the chest. However, some small data mining across the web gives some cues to the strategy followed. The relatively silent new campaign has gone through several “under the radar” acquisitions in previous years, obviously in preparation for the new era. The investments involve strengthening critical areas in their digital service provision such as cybersecurity with Help AG, cloud computing and data center operations with Khazna, and e-commerce with elGrocer. Their investment endeavors under the umbrella of e& capital have been even strengthened through a deal with digital bank WIO. To diversify its portfolio further, e& acquired substantial stakes in Starzplay Arabia, a well-known video streaming service provider. This will allow it to provide its users with customized content production and delivery.

Besides its digital transformation goals, e& has recently signed a memorandum of understanding at the mobile world congress (MWC)  with major telecom operators in the GCC to tackle climate changes, reduce the carbon footprint and increase sustainability.

What’s Next?

The flurry of acquisitions will most probably continue to enable e& to meet all its projected goals. The telecom giant will further try to increase its shares in other telecom markets, allowing it to expand further with additional flexibility in providing and customizing services to external markets. The new company will certainly remain alert to new investment opportunities. The Metaverse, advanced edge computing, emerging communication paradigms, digital currencies, automation, smart cities, artificial intelligence (AI), and digital twins are among the areas the company will certainly keep an eye on. In such a competitive market, e& will certainly face some rivalry from Big Tech companies who joined the telecom world relying on the openness of the new 5G standard. Having a private network without the guidance and regulation of the network operator will certainly be increasingly possible in the near future. So it will all boil down to the unique offerings the company will be able to propose. 

Concurrently, the path to success comes with constantly looking to update its 5G network to support new business use cases and user requirements while ensuring it is among the frontrunners in deploying the first 6G networks worldwide. This shouldn’t be much of a hurdle for the telecom giant with its financial and technical resources.

The rebranding event, therefore, highlights a perfect synergy between the vision of a state, the ambition of a telecom company, and perfect opportunism with a move and a strategy change that couldn’t have occurred at a better time. Suppose e& can keep this trident in hand with vision, ambition, and opportunism as defining factors for its future objectives. In that case, maintaining its stronghold over different markets will undoubtedly be easier. This, however, depends on continuous backing by the local governments, its willingness to invest in its talents, and its creativity in distinguishing itself from fierce competitors.