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Dmitry Shukov, CEO, MTS India

December 31, 2013
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MTS India’s new CEO, Dmitry Shukov, knows exactly where he wants to take the company and is impatient to get going….

The optimism among Indians that their future will be better than their past is the single most appealing feature about the country for Dmitry Shukov. Since taking over in June, he has been exhilarated by the situation he finds himself in as chief executive officer (CEO) of MTS India. For a man who likes to get results, what could be better than being in a country where the market potential is vast, the population young and huge, the opportunities endless, and where the MTS team is raring to go?

The icing on the cake is the weather. Delhi’s beautifully balmy winter sunshine is much more pleasant than his hometown Moscow (Sistema of Russia is a majority shareholder in MTS India) where temperatures will soon plummet to sub-zero levels.

After being offered the post, Shukov visited India in March and instantly decided that India was “the best country in the world to be in” for him and for MTS India. “I really wonder what it takes for Indians to be depressed. They are so optimistic and enthusiastic,” he says. “The challenge of India is irresistible. Elsewhere markets are saturated. Russia has 100 per cent penetration. But India can only grow exponentially. That’s why it’s an amazing place to be in.”

Like many Russians, Shukov grew up with some knowledge of India thanks to the Bollywood films that were not only popular with his parents’ generation but continue to be popular, he says, with young Russians today, the only difference being that they will probably access Bollywood on the internet rather than in cinemas. He remembers, as a young boy, liking Mithun Chakraborty and his parents watching Seeta aur Geeta about a hundred times.

His English is fluent but sometimes finding le mot juste makes him pause. What is striking about him is the sense of pentup energy inside him, as though he knows exactly where he wants to take MTS India and is impatient to get going.

As someone known for his inspirational leadership, he can be expected to set a scorching pace for the organisation. Luckily for his team at the MTS India office in Gurgaon, his evaluation of their skills is positive. “I have a very smart team, very supportive, very professional and very enthusiastic. I’ve been lucky to have this kind of a team wherever I have been,” he says.

A crucial aspect of his leadership style stems from what a Russian general (his father is a former Soviet Army officer) once said about motivating soldiers on the battlefield: “Each soldier must know and understand the general’s target.”

That is why Shukov makes it a point to constantly explain his target to every member of the team. “Only when you do that can you all move in one direction. Yes, of course every department – sales, marketing, IT - has different tasks, but they should all be working towards the same target,” he says.

Shukov brings 20 years’ experience to the job. His career in telecom began early. He graduated from the St Petersburg Military Telecommunications Academy with distinction in 1997. Prior to joining MTS India, he was CEO of MTS in Turkmenistan and Uzbekistan. Earlier in his career, in Moscow, he was deputy head of regional development at Svyazinvest, once the largest telecom group in Russia, where he handled regional business development, regional project management and international project management.

He first joined the MTS Group in 2006 in Moscow as head of business development. As the largest mobile operator in Russia and the Commonwealth of Independent States (CIS), the company provides mobile communications in Russia, Ukraine, Uzbekistan, Turkmenistan, Armenia and Belarus.

Shukov enjoyed working in Central Asia. “Cities like Tashkent are beautiful, very modern and very cosmopolitan. Tashkent, for example, was totally rebuilt after the colossal damage during the 1966 earthquake. It is very modern with wide boulevards and good transport,” he says.

After becoming independent of the former Soviet Union, the Central Asian republics, he says, have become more traditional as they turned more to Islam. And yet, he says, they are not dogmatic or rigid. “Islam here is not so strict. It hasn’t altered people’s lifestyles but society has turned more to religious tradition,” he says.

The market in India is very different from the more developed markets of Central Asia and Shukov has plenty to deal with here, most notably on the regulatory front.

In October, MTS rolled out its 3GPLUS network powered by Evolution-Data Optimised (EV-DO) Rev. B Phase II technology, becoming the only telecom operator to provide ubiquitous 3GPLUS network coverage across its nine circles. It also introduced MBlaze Ultra, a next-generation dongle providing data speeds of up to 9.8 Mbps.

Also in October, MTS became the first operator in India to receive its unified licence, enabling it to provide technology-neutral telecom services for 20 years. The next step was to wait for the allotment of spectrum. The path seemed clear and promising. Everything was on track.

But then the Telecom Regulatory Authority of India (TRAI) stunned the company by recommending that there should be no auction of CDMA airwaves, saying there was no demand for the 800 MHz spectrum band, except from MTS India, as seen in the last auction.

Spectrum in the 800 MHz band is what MTS India needs. Its CDMA technology depends on it. The company has invested billions of dollars for the development of a CDMA ecosystem. Opting for another spectrum and technology is not feasible.

Shukov was shocked but says that he has to find a way out. He points out that MTS India has informed TRAI that it wants to invest in the country and participate in spectrum auctions to expand operations. He also points out that there was no demand for even premium 2G spectrum in the 900 MHz band yet TRAI recommended its auction at a much lower rate.

Speaking candidly, Shukov describes TRAI’s recommendation as discriminatory. “We want a level playing field for CDMA operators. We are continuing to ask the regulator to give us a level playing field alongside GSM players. TRAI must set the reserve price for spectrum in the 800 MHz band. The government has asked TRAI to do so. Until then, CDMA spectrum auctions cannot be held,” he says.

“We have a strategy and want to upgrade our network quickly in order to provide the best data services to our customers. But if we don’t get access to spectrum, we cannot do anything,” he says.

Shukov is not just hungry for growth, he is also avid for information about what MTS India customers want. He flies out to a different circle every Friday, with his local team and an interpreter in tow, to meet shopkeepers and customers to understand what the company can do to improve its service.

He loves getting a real “feel” of what is happening on the ground – in tiny shops in Kolkata or small rural outlets in Rajasthan. Local retailers are very knowledgeable about their customers and Shukov wants to tap into their expertise and insights. On a recent walkabout in Nehru Place, Delhi, for example, a retailer suggested that the company should not waste time on conventional “passive” advertising but should use screens that demonstrate the speed and quality of its services.

“It was a brilliant idea. Subscribers like to try and test a service and then make a decision and so putting up a screen in a demo zone is a great idea which we are going to implement,” he says.

Of course, it has not all been smooth sailing. He has had to restructure the organisation to make it leaner and reduce costs. That meant losing some staff. But Shukov feels it has strengthened his team and will enable the operator to make quick decisions and connect better with its subscribers, he says.

For the moment, Shukov is living in a Gurgaon service apartment. His wife and daughter were not able to come with him to India because his ailing father needed to be looked after in Moscow.

Given the hectic travelling he does to different circles, it’s understandable that, when asked how he likes to relax, he replies, “I sleep. Sleep is my relaxation. I don’t get enough sleep during the week.”

Shukov is eager to get started on the next phase of growth. “We have to reach our target and break even by the end of 2014. Then we will make a big leap to the next generation. Our unified licence is for 20 years. We are here for the long term. Everything is in place – the team, the strategy, the funding, the experience, good stakeholders. All we need is regulatory clearances,” he says.

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