GIG: As Greece’s largest telco player, having completed significant investments over the years and with more to come, what are the key benefits of operating and investing in Greece based on your experience and analysis?
Sarsentis: OTE is investing over €500 million a year in Greece. Within this context, it is rolling out the biggest infrastructure programme, with extensive fibre rollout throughout the country, the widest 4G coverage, and rapidly moving to an extensive 5G rollout. OTE already offers fibre-to-the-home (FTTH) connections to over 300,000 households, while targeting over one million in the next three years, or approximately 25% of the country. In addition, OTE covers the bulk of the population with advanced FTTC technology delivering speeds of 100mbps or more. OTE launched 5G services in December 2020 and currently offers 5G coverage to over 40% of the population. Essentially, the whole country is covered with 4G+ technology, the best network in the country by a wide margin. OTE is consistently delivering the best telecom technologies to Greece.
Having moved on from the recent unstable past, Greece nowadays offers a very stable and friendly operating environment with a competitive tax structure, secure legal framework, reasonable regulations, all under the safety of the EU’s oversight.
In many ways, Greece is now the place of opportunity for investment, as it is catching up with other developed countries, hence offering the potential for positive investment returns
GIG: Can you tell us about the investments the OTE Group will be rolling out as part of its strategic plan for Greece – and the regional hub – over the short, medium and long term?
Sarsentis: OTE has a multi-faceted investment programme aiming to always offer the best customer experience and create a connected world. In this regard, investments are targeting an extensive and expanding fibre network; expanding the 5G coverage to an ever-bigger part of the population, so that when handsets and applications requiring 5G become widely available, our network will be reading and in full swing.
And yet, our investments are much more far reaching: we are investing in offering a competitive entertainment platform with our unique TV content; we are investing heavily in our IT systems, so that our customers can have a simple digital interaction, while we can immediately respond to any customer requirements; we are also investing in our internal digital transformation to continuously improve our services, while enhancing our efficiency; and we are investing in developing our broader ICT capabilities, to offer unique technology and connectivity solutions to our customers in the public and private sectors, facilitating their digital journey. We will not stop!
GIG: Greece has taken significant steps to become more business and digitally-friendly with a slew of additional plans on the table for further improvement in the years to come. What more needs to be done in your opinion?
Sarsentis: After years of stagnation, Greece is now rapidly accelerating its investments in digital technologies. And, as it is often the case, we are jumping ahead as we move towards more advanced solutions. The Greek state is investing in a multitude of digital services to simplify its services and bureaucracy. Recent cases include an exemplary COVID–vaccination system, a system to issue numerous certificates digitally, while new plans include the unification of numerous citizen IDs into one system, the establishment of digital cadastral registries, among plenty or other initiatives.
Several start-ups or digital companies are developing, creating a very exciting ecosystem. Capital is starting to flow, even though the banking sector still lacks the necessary expertise and risk appetite. Unfortunately, there is limited domestic institutional capital and few liquidity options. Yet international flows are growing fast.
What is necessary from here on is the establishment of digital education, removing old prejudices against progress, and increasing awareness.
The corporate sector will need to invest heavily in digital technologies and trust new methods if they are to evolve to the next generation and grow. Inevitably, this will be a period of “creative destruction” after all where new modern corporates evolve in the space where older ones fail to adapt.
GIG: How easy has it been for OTE to adapt to the needs brought on by the COVID crisis, such as the increased demand for data from households, almost overnight, on account of the lockdowns, and the weaker tourism seasons that affect visitor roaming?
Sarsentis: Society has shown that when there is a true emergency it adapts instantaneously. So did OTE; there was no choice. Most importantly, OTE was called upon to support these new conditions with people working from home, students being home-schooled, and the state requiring big data analytics. OTE succeeded on both fronts: in supporting the country’s critical telecom infrastructure and in switching to remote working over a weekend.
COVID had a series of social and business implications, some of which were important to OTE. First and foremost, it highlighted the importance of telecom infrastructure and operators. It also increased demand for high speed home connectivity. People stayed at home a lot more and, of course, when someone is at home they are not mobile. In other words, there was a drop in mobile usage. There was also a change in TV content, in the first wave in particular. As sports venues shut and major sporting events were cancelled all over the world, TV offering suffered.
On the other hand, international tourism is a major contributor to the Greek economy. Following years of fast growth, tourism collapsed in 2020. This had an impact on many businesses, which OTE supported during the crisis. It also led to a 50% drop in important roaming revenues. Yet, a robust operation should withstand such events. And OTE succeeded. Ironically, Greece’s severe economic crisis in the previous decade served as “good experience” in crisis management.
GIG: What is the outlook for 2021 for the OTE Group and what makes it an attractive investment overall?
Sarsentis: OTE is continuously investing to stay ahead of the competition, by offering consumers the best all-around experience. Our products and services are steadily evolving to meet society’s ever-expanding needs.
Telecoms that were once considered “dumb pipes” are now constituting invaluable infrastructure, as has been evidenced during the COVID crisis. Yet, it is infrastructure that is constantly evolving.
Telcos, including OTE, are now investing in technologies that will generate returns for decades.
OTE is one of the largest Greek listed companies. It has one of the best growth profiles in the European telco space capitalising on the population’s ever-expanding telecom needs, as well as the opportunities that are being presented by investments to digitise the country. In addition, OTE offers one of the best shareholder yields in the sector, which has been steadily rising in recent years. As we anticipate exiting the Covid crisis in the coming weeks, Greece, that suffered from a drastic tourism decline during the past 12 months, is set to enjoy a strong recovery.