Doing Business in Azerbaijan 2009 - Azerbaijan Export ...

Telecoms & IT
Azerbaijani telecommunications is the second largest recipient of
foreign investment after the oil industry. The first wave of liberalization
took place in the 1990’s when a number of foreign investors
entered the market. The largest FDI stock is in the mobile telephony,
followed by a number of enterprises with the foreign capital in
land lines operating companies, internet providers and cable TV
companies. Foreign investors are represented by Turkish, Israeli,
UK, Russian, US etc. capital. The sector now is on the verge of
further restructuring. One of the major steps taken is continuing
privatization of the state shares in the telecoms and IT enterprises.
The Azerbaijani telecom market is expanding rapidly. It is one of the
leading sectors contributing to the economy growth. 125 thousand
land lines were installed in 2004 only which is above 10% growth.
Number of mobile telephone subscribers exceeded 6 million in 2008
and continues to grow rapidly.
At the present there are 15 telephone sets per 100 inhabitants. The
similar indicator is 33.0 for Baku city and 5.7 for rural areas. There
are more than 3 million Internet users in Azerbaijan with a network
of service providers throughout the country. Further development of
the telecoms services is underpinned by the construction of Trans-
Asia-Europe fibre-optic cable. It will give an impetus to introduction
of new internet related services, international traffic etc.
There are four mobile operators in the country: Bakcell, Azercell
and Azerfon with GSM standards and Catel with CDMA standards.
New GSM operator Azerfon entered Azerbaijani mobile market in
March 2007. By the end of 2008 the number of subscribers of
Azercell reached 3 700 000. Coverage area of the network is 80%
of Azerbaijan’s territory. The capital investments have been made
by Azercell since 1996 were more than 600 mln USD. In 2007 the
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