Monday, December 23 2013

Besides
such big players at the communication market of Armenia, as ArmenTel, Vivacell-MTS,
Rostelecom, Ucom and other big companies, there is still room for
representatives of small and medium-sized business. It is especially important
that many of them have been functioning in the regions and covering by their
activity the “gaps” which are not interesting to the big players from the point
of view of their effectiveness. The provider company “Arpinet” working in the
Armavir region of Armenia,
is one of them. It is a bright sample of the client-oriented company which
offers Internet and is going to enter the IP – television segment.

 

Director
of  “Arpinet” Ltd, Armen Muradyan, tells
about development of the regional provider business, its problems and future
programmes.

 

Will you please tell
about the history of your company? When was it created? What services does it
offer?

 

 Our company “Arpinet” Ltd was founded in 2007.
We work in the telecommunication sphere and offer Internet and IP-television to
individual  and  legal persons. We started offering Internet
in Etchmiadzin in 2007. In
fact, in 2008 we also started offering Internet to the nearby villages of
Etchmiadzin. In 2011 our company fully upgraded its infrastructure, as a result
of which people in Metsamor and Armavir and nearby villages started using
Internet offered by us. We have also managed to open our offices in several
villages.

 

Is it easy to survive
at the market where the telecommunication sector has been developed rather good
even versus several European countries? Don’t you scare to bankrupt because of
strong global competitors?

 

Our company
has been working in those sectors of the market, which the big companies do not
pay attention at, as “game is not worth of candle”. However, our company is not
the only one in Metsamor and Oktemberyan towns, Rostelecom also offers its
services there. As for Etchmiadzin, here Beeline, Orange and Vivacell also offer their Internet
services. However, we often offer Internet through the fiber-optic cable with a
transmission capacity up to 1 Gbt/s, but the above mentioned companies – the
Internet of the third generation (3G) or ADSL.

 

I would
like to draw you attention at a very much important moment – “Arpinet” is the
only company in Armenia
which offers the fiber-optic Internet to villages.

 

But to implement such
a large-scale activity you needed big investments, did not you?

 

Yes, we
did. Like any other business, we needed investments. And Ameriabank  became the investor and the lever for
development of our business. The bank has turned to be flexible and offered
services for more convenient conditions. Thanks to the support of Ameriabank,
we have managed to transfer from the category of small to the medium-sized
business. Through crediting us many times, the bank gave us the chance to grow,
to develop end improve our activity.

As a
result, we have created and developed the net and started  launching the IP-television, the only one in
the region. The unique character of the last product is that a client having a
BOX will be able to join the Internet even through an old TV-set. Communication
in social networks, currency exchange rates, weather, information and video
portals, Skype, books and games have been already integrated in our Arpinet
IPTV box.  The box functions at Android
system, it is made in the “all inclusive” format. If a client makes a one year
contract with us, the box is given  to
him free of charge.

 

To succeed, the company
should have competitive privileges. What is special about your company?

 

Here is the
formula of our company: “speed-quality-price”. We offer not only high-speed
Internet, which does not lag behind the Internet offered by other companies,
but also have permanent contact with our clients provided by the Call Center
working in 24/7 regime. And an absolutely free of charge service is one of the
main privileges of our company. The policy of our business is orientation on a
client. We have many different marketing actions for clients which have been
using services of “Arpinet” for more than a year. We have a bonus system for
permanent clients, which supposes increasing of the Internet speed, offering
new services for lower tariffs, etc.

 

As we know, business
cannot stand still. You should expand the spectrum of Internet services and
increase the customer base to be able to compete. Have you got any
specific plans? 

 

You see,
the material condition in rural communities leaves much to be desired. So, not
all villagers can afford Russian-language digital TV channels. We are planning
to provide all villages of Armavir province not only with high-speed
Internet  (up to 1 GBIT/sec), but also
with IP television. We were granted the relevant license in 2013. By the way,
we will also be able to implement the project due to Ameriabank’s loan the
company is going to receive in spring 2014.    

 

There are cases when a
company specializing in some activities is also engaged in related activities. What
about your company?

 

We are also
engaged in related activities. These are stores of computer facilities. If a
customer buys a computer, a notebook or a tablet and concludes an agreement
with us for a year, we provide him/her with 3-month free Internet, and if the
customer concludes the agreement for a month, we provide him/her with 1-month
free Internet. 

 

Our online
store does work yet, but we are planning to open it in 2014. We have 6 offices
not only providing Internet services but also selling computers. As soon as the
online store is launched, the customers will be able to choose the goods and
receive them immediately with delivery home. Moreover, the delivery will
most likely be free.    

 

At the
moment we are developing one more product of ours – an online cinema - www.arm-tube.am.
By the way, it is probably the only video hosting in Armenia,
i.e. it is connected to the .am zone, and if there is some Internet failure in Armenia, the
user will be able to continue watching the films. In addition, we are going to
set up our cash servers at various providers, which will accelerate the
operation of our video hosting even more and will ensure stability. It should
be noted that this is the only operating product, within which we try to
cooperate with the film producers. The ice has broken up. There are already
some examples such as Poker.am and Jubilee Visitor. One can watch the films
free of charge with commercials or on a paid basis without commercials.
Payments are made through the local Idram and ArCa systems or international
MasterCard, Visa, PayPal, WebMoney and other systems. 

 

Many citizens of Armenia are
becoming labor migrants due to the hard economic condition of the country. One
of the advanced methods of communication between the relatives is software for
video and audio calls (e.g. Skype). So, there is a category of people who need
Internet for these purposes only.

 

You are
absolutely right. We have recently conducted a survey and revealed the category
of people who use Internet for that purpose only. And now we are working at
creation of such an inexpensive product. 

 

As far as I know, you
provide symmetrical Internet and IP television to individuals and legal
entities. What shares have they got in the total customer base?  

 

Individuals
are the major part of the consumers.

 

Everybody knows that
wages and prices in towns differ from those in villages.

 

Active
measures are currently being taken to provide the rural communities with
fiber-optical Internet. So, in rural communities, where Internet connection is
ensured through a fiber-optical cable, the prices are similar to those in
towns. However, there are provinces where Internet connection is ensured
through wireless modems only, and the price is much higher there, but we retain
the price policy the same. 

 

There are a lot of
methods of competition ranging from simple dumping to various twists and turns.
What tools do you use to maintain the competitiveness of your products?    

 

As regards
competition, I would say that we are dead against dumping. Therefore, our
minimum tariff is 6,000 AMD. We compete only by enhancing the quality of the
Internet and the service. 

 

Have you got an
opportunity to reduce the prices?

 

The
Internet price is not formed by us. It depends on the price at which Internet
is imported to Armenia.
If it drops, consequently, we’ll reduce the tariffs, too. But now we try
retaining the prices at the same level and the return on business ratio is
10-15%.     

 

Aren’t there any
Internet failures through your fault? What does the company do to prevent it?

 

In 2011 a fiber-optical cable
was for the first time laid in Etchmiadzin along the railroad. GNC Alfa CJSC
considerably contributed to that. In 2012 we launched the second line along the
Yerevan-Etchmiadzin highway. As a result, we got a chance to reduce the risks
of blackouts. However, it is impossible to have no failure or troubles at all,
because we deal with equipment. For these particular cases our agreement has a
provision saying that our company compensates for the lack of Internet within 2
and more days in a month by providing free Internet days.