In a world where nearly every interaction hinges on digital access, what happens when a telecom giant decides to leap beyond the boundaries of traditional connectivity? VEON, a global operator group, is not just providing phone lines or data plans but is crafting a bold new landscape where financial tools, ride-hailing apps, and cutting-edge AI are as integral as a SIM card. This shift is captivating millions across emerging markets and war-torn regions alike, challenging the very definition of what a telecom company can be. Dive into this transformative journey as VEON reimagines the industry with a digital-first mindset.
The significance of VEON’s evolution cannot be overstated. As traditional European telecoms grapple with stagnant growth, this company is tapping into the explosive potential of 90 million new 4G users and transitioning 40 million voice-only customers to digital platforms. With digital services revenue soaring by 63% to $198 million in the latest quarter, VEON is proving that telecom can be a gateway to broader ecosystems. This story matters because it signals a seismic shift in how technology can empower underserved populations, redefine customer engagement, and set a blueprint for the industry’s future.
Telecom Beyond the Basics: A New Vision
VEON’s approach challenges the conventional telecom model by expanding into realms far removed from mere calls and texts. Picture a farmer in rural Uzbekistan accessing financial services through a smartphone app or a student in Ukraine hailing a ride via a telecom-powered platform. These are not distant dreams but realities shaped by VEON’s digital ecosystem, which now outpaces its traditional SIM card user base as of a recent milestone. This pivot reflects a daring ambition to integrate technology into everyday life in ways previously unimagined for a telecom provider.
At the heart of this transformation lies a refusal to be boxed in by legacy systems. While many competitors remain tethered to outdated infrastructure, VEON is building bridges to digital inclusion, particularly in regions hungry for innovation. The company’s focus on emerging markets, where smartphone penetration is rapidly climbing, positions it as a pioneer in redefining user expectations. This is not just about staying relevant—it’s about leading a movement where connectivity becomes a launchpad for life-changing services.
The Urgent Need for a Digital Telecom Revolution
The telecom industry stands at a critical juncture, where adaptation is no longer optional but essential for survival. In Europe, numerous operators face flat revenue streams, constrained by old-school connectivity models that fail to resonate with today’s tech-savvy consumers. Meanwhile, emerging markets are witnessing a surge of new internet users, eager for solutions that go beyond basic communication. VEON’s relevance stems from its ability to address these contrasting dynamics head-on, crafting strategies that cater to diverse global demands.
This urgency is amplified by stark market realities. With 90 million individuals gaining 4G access and purchasing their first smartphones, there’s an unprecedented window to shape their digital experiences. Additionally, 40 million voice-only customers represent a goldmine of potential, waiting to be introduced to data-driven services. VEON’s proactive stance in capturing these opportunities highlights why the industry must evolve now, embracing digital tools to meet the expectations of a rapidly changing user base.
The stakes are high, especially in volatile environments like Ukraine, where operational challenges test resilience. Despite such hurdles, VEON’s ability to grow revenue under pressure—evidenced by Kyivstar’s 20.9% increase to $293 million—demonstrates that digital innovation can thrive even in adversity. This adaptability underscores a broader lesson for telecoms worldwide: clinging to the past risks obsolescence, while embracing change unlocks untapped growth.
Inside VEON’s Digital Transformation Strategy
VEON’s roadmap for reinvention rests on a multifaceted strategy that distinguishes it from traditional telecom giants. A standout pillar is the explosive growth of its digital services, with revenue jumping 63% to $198 million in the most recent quarter. This surge is fueled by financial solutions and ride-hailing platforms, marking a departure from reliance on conventional telecom income. Such diversification illustrates how VEON is weaving itself into the fabric of daily life across its markets.
Innovation in artificial intelligence forms another critical component of this strategy. Through initiatives like QazCode’s KazLLM in Kazakhstan and plans for localized language models in Ukrainian, Uzbek, Bengali, and Urdu, VEON is tailoring AI to meet specific cultural and linguistic needs. Meanwhile, a partnership with Starlink to roll out direct-to-device services signals a commitment to cutting-edge connectivity solutions. These efforts collectively showcase a vision that prioritizes market-specific relevance over one-size-fits-all approaches.
Challenges persist, particularly in regions like Ukraine, where Kyivstar’s impressive revenue growth is tempered by higher capital expenditure ratios. Yet, VEON’s response—exploring asset-light models like third-party tower ownership—reveals a pragmatic balance of ambition and caution. This blend of bold innovation and operational resilience, further evidenced by digital users surpassing traditional ones, paints a picture of a company not just adapting but actively shaping the future of telecom.
Leadership and Data Fueling the Transformation
Insights from VEON’s CEO, Kaan Terzioğlu, provide a compelling glimpse into the company’s forward-thinking ethos. “The goal is to be the first smartphone experience for millions, complete with pre-loaded apps and payment solutions,” Terzioğlu emphasizes, underscoring a mission to capture the digital journey of new 4G users. His vision targets not only the 90 million entering the online world but also the 40 million voice-only customers poised for transition, highlighting a deeply customer-focused strategy.
Backing this ambition are robust financial results that lend weight to VEON’s direction. A 7.5% revenue increase to $1.1 billion and a 19.7% EBITDA rise to $524 million in the latest quarter reflect strong performance, with digital services contributing 17.8% of total income. These figures demonstrate that the pivot toward digital ecosystems is not just aspirational but a tangible driver of growth. They also validate the company’s ability to maintain telecom stability while scaling new revenue streams.
Terzioğlu’s strategic clarity extends to operational efficiencies, particularly in challenging markets. In Ukraine, where Kyivstar operates under wartime constraints, the suggestion of third-party tower ownership to enable network sharing reflects an asset-light approach aimed at long-term sustainability. Combined with hard data, this leadership perspective reinforces VEON’s credibility as a transformative force, balancing visionary goals with practical execution in a complex global landscape.
Lessons from VEON for a Connected Tomorrow
VEON’s journey offers valuable takeaways for navigating the intersection of telecom and digital innovation. One key insight is the power of diversification—extending beyond core services to integrate tools like financial apps or localized AI can address unique regional needs. For stakeholders in emerging markets, this means identifying gaps in digital access and tailoring solutions to empower first-time users, much like VEON’s focus on pre-loaded smartphone experiences.
Partnerships also emerge as a critical lesson, exemplified by VEON’s collaboration with Starlink for direct-to-device services. Such alliances can bridge connectivity divides, especially in remote or underserved areas, offering a model for businesses to expand reach through innovative tie-ups. Additionally, targeting untapped demographics, such as the millions adopting 4G, with bundled digital offerings from the outset can drive organic growth—a strategy worth emulating across industries.
Finally, VEON’s ability to balance stability with innovation provides a roadmap for resilience. Maintaining robust infrastructure while aggressively pursuing digital revenue, even in tough conditions like wartime Ukraine, shows the importance of adaptability. For companies and policymakers alike, this approach suggests a dual focus: safeguard core operations while investing in transformative technologies to stay ahead in an ever-evolving digital landscape.
Reflecting on a Pioneering Path
Looking back, VEON’s bold strides in redefining telecom stand as a testament to the power of vision and adaptability. The company’s leap into digital services, AI innovation, and strategic partnerships marks a departure from industry norms, setting a precedent for others to follow. Each step, from capturing new 4G users to navigating operational challenges, showcases a commitment to transforming lives through technology.
The journey also illuminates actionable paths forward. Industry players can draw inspiration by prioritizing digital diversification, forging impactful collaborations, and targeting emerging user bases with tailored solutions. These efforts, if pursued with VEON’s blend of ambition and pragmatism, hold the potential to reshape connectivity’s role in society.
Beyond immediate strategies, the broader implication is clear: telecom’s future rests on its ability to evolve into a multifaceted enabler of digital ecosystems. As challenges persist, from market saturation to geopolitical unrest, the call is to innovate relentlessly, ensuring technology serves as a bridge to opportunity for millions worldwide. VEON’s legacy offers a starting point for this ongoing transformation.
