INTERVIEW >
EXCLUSIVE: Mobile CEOs trade punches
Written by: René Jakl, John Letzing, Philippe Riboton
Photo by: V&V

For the first time ever, The Prague Tribune brought the CEOs of all three mobile operators together for an exclusive round-table discussion. Karla Stephens (Oskar), Terrence Valeski (Eurotel) and Roland Mahler (T-Mobile) managed to hold a conversation that was good-natured and humorous - yet tinged with the intense competitiveness of their market.

From left: Roland Mahler (T-Mobile), Karla Stephens (Oskar), Terrence Valeski

The Prague Tribune: Is this the first time you've met each other?
Terrence Valeski: Roland and Karla have not met before. So the three of us have not been together in the past.
Karla Stephens: Roland and I have never met, but we sure have sent a lot of legal letters back and forth, so I feel like I know his lawyers well. I don't receive as many from Terrence.
Terrence Valeski: I don't have any lawyers (laughs).
Karla Stephens: Whenever I get a legal letter from Roland, which is quite often, my legal team says, you see, Roland's got a team of 30 lawyers, and we're only a team of six!
Roland Mahler: I don't think it's right that we have 30 lawyers, not at all.
Terrence Valeski: No, it's twenty (laughs).

You all keep abreast of each other's activities very well. How?
Terrence Valeski: I don't think any of us are shy in terms of speaking out, so occasionally in the press you find an opinion there in terms of what's happening with the other companies.
Karla Stephens: I've lived in a lot of different countries during my career, and for some reason information seems to get out here a lot faster... I'd say with these two (Valeski and Mahler), there's got to be, and I'm not trying to create ripples here...
Terrence Valeski: Really? (laughs)
Karla Stephens: A good example is MMS (Multimedia Messaging). The market knew that Eurotel was going to be first to launch it, and somehow T-Mobile scooped it at the last minute.

Roland Mahler (to Stephens): Did you have a problem with that?
Karla Stephens: No, I thought it was entertaining... Eurotel was going to be first to market, and then T-Mobile came out of left field and put it into the marketplace without being as prepared as Eurotel was when they launched theirs afterwards. So I do think that information does flow, unfortunately, a little too readily here.
Terrence Valeski: There are some fun things that we do to each other on occasion - stick a knife in the back, but not with a fatal blow. We did have MMS, and delayed it because of the floods, and so T-Mobile got a little opportunistic.
Roland Mahler: We had prepared everything, and I think by accident we were on the same timeline. It was just a question of tuning the timeline.

Could each of you describe your average customer?
Roland Mahler: I would even regard that question as an insult... there is no average customer.
Terrence Valeski: We do have a large number of corporate customers, but a larger number of pre-paid.
Karla Stephens: A lot of our customers are comfortable with taking risks; they're more of an adventurous group. They are the entrepreneurs and the underdogs.

As a customer, if you had to choose an operator other than your own, which one would it be and why?
Karla Stephens: If I didn't mind wasting my money on really expensive services for Paegas...
Roland Mahler: T-Mobile, please.
Karla Stephens: T-Mobile, sorry. It's difficult to keep it straight.
Terrence Valeski: I'd pick Czech Telecom (laughs).

How important are corporate clients to your revenue models, and how do you target them?
Karla Stephens: I let these two battle for the corporate clients. We have a few that we're very proud of... so they get special treatment.
Terrence Valeski: They are important, so we compete with quality of service, not price.
Roland Mahler: We think we have an excellent proposition in that we are the only member in this market of an international group, which brings tangible benefits for our customers...
Terrence Valeski: If we're getting into a technical discussion, that's a gross misrepresentation.
Karla Stephens: Roland, that was such a sales pitch!

Isn't it beneficial to be part of an international group?
Terrence Valeski: I don't believe international parentage is a particular benefit to this market.
Roland Mahler: Well at least our customers, Terry, have understood the message.
Karla Stephens: Roland, you're itching for the number one position, you've been pretty aggressive.
Roland Mahler: I'm satisfied to just increase the customer base, what it means in terms of ranking is secondary.

(To Mahler) Aren't you obsessed with being number one?
Roland Mahler: No, if we really needed to become number one, I'd start thinking about that.
Terrence Valeski: We have the number one position, and we intend to keep it.
Karla Stephens: Being number three means I have different issues. I want to get a good base, and take care of it, but it's not a desire to get to number one. These guys won't just give me their customers.

(To Stephens) Could you sum up the Oskar marketing pitch as "we're a friendly rebel," and is that characterization fair, and sustainable?
Karla Stephens: Our customers themselves have been friendly rebels and underdogs... I think we're going to continue to evolve that, and keep the brand momentum. As you can see (gesturing to her red and black clothing, the colors of the Oskar brand), I'm brand crazy - I'm Oskar crazy. My car is decked out and Oskar-ized. I'm decked out all the time.
Roland Mahler (to Stephens): I'm really grateful, Karla, to be able to take away from this interview the knowledge that in our segmentation we have not yet defined the "rebel" and "underdog" segments. We'll look into that.
Terrence Valeski (to Mahler): Have your lawyer send her a letter (laughs).

(To Valeski and Mahler) Speaking of "brand crazy", are you two as brand-crazy about your companies?
Terrence Valeski: I have another life.
Roland Mahler: I certainly know how important a brand is... but that doesn't necessarily have to mean that I run around in magenta suits.
Terrence Valeski (to Mahler): Let's see your boxer shorts (laughs).

Maybe some other time. Mr. Mahler, as a member of T-Mobile now, do you feel you've lost a bit of creative control over your marketing? It doesn't seem as specifically segmented as it used to as Paegas.
Roland Mahler: There is a specific system for what is handled as international and what is national. T-Mobile is not only international, but also in each market there is a local flavor, especially the Czech market.

(To Valeski and Stephens) How did you take advantage of the Paegas/T-Mobile re-branding?
Terrence Valeski: We certainly didn't lose anything, but at the same time, it wasn't particularly advantageous either. I thought it was a reasonably decent process of re-branding.
Karla Stephens: The Czech consumer, I think, found it confusing, to one day see Paegas and the next T-Mobile. For us, Oskar is a real local brand. So it kind of helped support us to continue to be that local brand.
Roland Mahler: It was really the right decision... we have continuously monitored awareness of functional and emotional attributes, and it will take just another two months and we will be at the same level of awareness where Paegas was before.
Karla Stephens: Roland, you are a research maniac. I can just see you poring over your digest and research, it must be very important for you.
Roland Mahler: I think marketing is very much about research... I think that is a tool for any mobile operator.

How have the overall problems in global telecom markets affected the market here? Can this market really sustain three operators, some two or three years down the road?
Terrence Valeski: Could the market sustain two operators: yes. Could it sustain three: I think so. We have not suffered here, we haven't over-invested... I think at some point there will be different combinations.
Roland Mahler: It's not only a question of whether the market can sustain, it's also about profitability and future contributions to the further development of the market. There is already some indication, in that the third operator (Oskar) has not come forward for a UMTS license.

An indication of what?
Roland Mahler: I take it as an indication, and I apologize, Karla, if this is the wrong interpretation, that it's because of financial means.
Karla Stephens: I know the (Oskar) investors are very happy... I wouldn't be here, and I wouldn't be so proud of Oskar if I thought there wasn't a long-term future for us here. As far as UMTS... all three of us gamble, and Oskar is taking the gamble that UMTS won't take off.

NOTE: This interview was conducted on December 13, 2002, in the Radisson SAS hotel, Prague. The text has been edited in the interest of formatting.