Sci & Tech

The Decline of Taliya Explained

The Decline of  Taliya ExplainedThe Decline of  Taliya Explained

Once upon a time there were only two mobile networks in Iran and the tech world looked very different than it does today.

The year was 2004, the international mobile phone market was still dominated by Nokia and Bluetooth had just been released by the Finnish company. It was the year that mobile phones had 1 megapixel cameras and Apple was at the top of its game with the release of its latest iPod.

It was also the year that Iran launched its first privately-owned mobile phone network called Taliya.

The original second network opened to much fanfare. Prior to its release, SIM cards were nearly impossible to get and SMS was not even part of the network. No longer would prospective mobile phone owners wait in line for MCI SIM cards, which at the time was famous for limiting the release of their cards and charging inflated prices.

Taliya looked set to tackle MCI's dominance with its pay-as-you-go SIM cards, a first for Iranian mobile networks. It also offered affordable rates compared to the monthly billing system. But, due to a series of events in the course of the past 11 years, the network has been relegated to fourth place partly due to new entrants like MTN Irancell and RighTel.

 The network provider was dealt a further blow as its initial competitor bought a controlling stake in the business back in 2013 after it filed for bankruptcy.

Taliya failed to retain its market position, now officially ranked as the fourth operator with a 1% market share according to BMI, because of its poor management and weak planning.

Like Nokia and Ericsson before it, the companies which provided the telecoms infrastructure for Iran during the 2000s, the company failed to foresee the changing trends and could not compete for the lower end of the telecoms market with stronger competition coming in the way of MTN-Irancell, the joint South African operator.

  Technical Issues

Technical problems through the years also led customers to leave the network in hordes. During 2006, Taliya users reported a lack of "antenna" or poor mobile reception in central Tehran as one of the main problems.

Other technical failures included poor infrastructure and customer service, with one customer reporting the "same SMS message arriving over 170 times for three days".

The customer, who did not want to be named, said, "I had to literally remove the SIM card as the message kept coming through day and night." reported in 2014 that Taliya had to file for bankruptcy in the previous year citing unpaid debts as well as unpaid "technical service fees".  When its competitor MCI bought a majority stake in Taliya, the original owner was left with 43% share.

The report also said that at the company's in 2006, the company had 320,000 operational SIM cards and by 2014, 200,000 people were "actively" using Taliya.  

Business Monitor in its Q3 report for 2015 reports Taliya has 1.4 million subscribers both inactive and currently operating.

  Management Failures

Management problems of the mobile network have become more apparent in recent years. After the inauguration of Hassan Rouhani as president in Aug. 2013, the newly-appointed telecoms minister at the time, Mahmoud Vaezi, said the company does not have an "operations license".

This major managerial oversight also increased, as their permit to broadcast using the national broadcasting system was limited to 15 years, as of 2004, meaning there is currently less than four years left.  

On its current plight, a report by ICTNA in 2014 reported that a member of the company's board of directors, Saber Feyzi, said "they were victim of MCIs business tactics", which he did not elaborate on.

The company official said that now that the company is majority owned by MCI, it will now need the first operator's investment to get things moving again.   

He added that Taliya will need around 2 trillion rials, ($59 million) for getting the network operational again by moving away from its GSM-900 bandwidth. As the board member said, "Taliya was in a coma."

The company stated repeatedly in the past 12 months that it hoped to attract new investment and upgrade its decade-old broadcasting systems to 3G and 4G systems, and compete with the other three networks.

The latest report from the company, by way of the Young Journalists Club in July, reports that board members from both Taliya and MCI are in negotiations to cooperate in "certain fields". Once again, the details were not mentioned.

Financial Tribune has repeatedly tried to contact Taliya for an interview, but has so far failed to receive a response. Nonetheless, the situation for the former leading prepaid network may be worse in the years to come.

Not only does the company need to find further funds to upgrade its network to modern standards and fix regulatory issues such as licenses in the next few years, they also need to look out for other new entrants like Shatel that has publicly stated it is planning to offer 4G VOIP voice calling via mobile.