POLAND lT and telecoms: going global
GEARING UP FOR EU MEMBERSHIP MEANS THE TELECOM AND IT SECTORS MUST BE ONLINE TO FACE THE CHALLENGE OF COMPETITION. BOTH SECTORS ARE EXPANDING RAPIDLY TO BE READY TO MEET DEMAND

A PLEDGE TO THE NATION no other Polish telecom entity has come close to TPSA’s contribution to the continuous expansion of Poland’s telecommunications infrastructure.

The Polish government is well aware that in order to remain a top contender among candidate nations in tline to join the European Union, Poland–as a gateway between Eastern and Western Europe–has to keep improvements to its infrastructure at a steady pace. And while a lot of attention has been focused on the transit nation’s roadways, a viable telecommunications system is also a key step on the road to economic growth and EU membership.
The leading telecom company in Poland by far is Telekomunikacja Polska S.A. (TPSA), a state monopoly now making the transition to meet the challenges of competition. With nearly a million new subscribers to TPSA’s services each year, no other Polish telecom entity has come close to this company’s contribution to the continuous expansion of the nation’s telecommunications infrastructure.

MAREK JOZEFIAK President and CEO of Telekomunikacja Polska S.A.

TPSA took a giant leap towards total dominance in the sector in 2000, when France Telecom–another former monopoly with the experience of successfully having adjusted to a liberalized market–purchased 25% of TPSA’s capital, a clear signal to the rest of the telecommunications industry that the Polish market is worthy of investment. An even clearer signal is the fact that TPSA now accounts for 10% of France Telecom’s revenue.
"It is very important to have this strategic investor, because after all, France Telecom is one of the leading telecommunications groups in the world. It provides us with a very good chance to transform telecommunications in TPSA and in Poland," TPSA President and CEO Marek Józefiak explains.

"We want a company that is user-friendly, and understands customer needs and requirements. We want our company to be able to meet the challenges of the free market economy," Mr. Józefiak adds.
The TPSA president says his group has laid down a clear strategy for 2001-2004 that is based on four main pillars. "The first pillar is mobile telephony, the second pillar is the Internet, the third is data transmission and the fourth is fixed telecoms. The client is at the center of our efforts," Mr. Józefiak stresses.
TPSA already leads the fixed-line market in Poland, and its strategy is to maintain that leadership. It also has a 50% share of the data transmission market, which has already been liberalized.
The TPSA-French Telecom partnership’s mobile phone operator is Centertel, with TPSA controlling a 66% share and the French group holding the remaining 34% of the capital. Just two years ago Centertel had just a 17% share of the mobile market. It now has more than three million subscribers and a 29% share of the market which is growing rapidly. As the former CEO of Centertel, Mr. Józefiak was the driving force behind the company’s evolution from the outdated analogical system to the modern GSM 900 network it has today.

"On March 1, 2000 we started GSM 900, and in September 2000 we could say that 90% of the Polish population was within reach of our network. So we managed to overturn the opinion that our service, Idea, was good but did not have the coverage that the others had," says Mr. Józefiak, adding that the goal is to make Centertel the number two company in the market by the end of the year.
As far as the Internet sector in Poland is concerned, TPSA already has a 90% share of the market when it comes to dial ups and the current strategy is to maintain that leadership. "But we are also anxious to provide more Internet services of a different nature," the TPSA president points out. "In order to do that we have acquired the Internet portal Wirtualna Polska. It is the second most popular portal in the country and we are still trying to provide more services."

RYSZARD KRAUZE President of Prokom Software

One of the local companies TPSA looks to when it needs comprehensive Information Technology (IT) solutions and systems that fit its growth strategy is Prokom Software, an eight-year-old enterprise that has quickly become one of the leading IT solutions providers in the Polish market and was recently chosen to implement an IT system for the Social Insurance Company, ZUS. The Bank of New York is a strategic shareholder and Prokom is traded on the London Stock Exchange, one of the few Polish companies being quoted outside the country.
"The IT system used in the ZUS project is based on IBM mainframe computers," says Prokom Software President Ryszard Krauze. He adds, “IBM told us that this project, in terms of database size and complexity, is the biggest IT project in the world."

With the prospect of competing within the European Union just around the corner, Mr. Krauze acknowledges that it will not be easy. "Markets in countries like Germany are well defined and well divided. But I definitely see some opportunities. We can offer certain solutions that are far less expensive than the solutions of our German colleagues. On the other hand, Germany is protecting its market against foreign companies, whereas Poland is much more open to international competition."