Turkcell CTO: “We want to change the destiny of the telecoms industry”

CTO Interviews

Turkcell has a singular vision for digital transformation, which has seen it outrun OTTs in its home market. Gediz Sezgin, the Turkish operator’s CTO and the industry’s newly-crowned Regional CTO of the Year, tells James Blackman about its mission to change telecoms.

Our target is not just the Turkish diaspora, or the wider Middle East. We are targeting the whole world,” comments Gediz Sezgin, Senior VP of Network Technology at Turkcell. 

A modest start but it is a mark of the Turkish operator’s confidence in its own digital transformation that Sezgin is just about the only tech chief at this magazine’s CTO of the Year event in London (see page 16) to present authentic solutions to the industry’s grandest challenges.

How can operators compete with the over-the-top providers with fewer physical assets and freer business models? It is a question that goes round and round the table in London, until it falls to Sezgin. “We do the same as them,” he shoots backs. “But we do it with our own capabilities.”

It was the same at Mobile World Congress in Barcelona in February, and any number of trade shows in between, where Sezgin’s boss, Turkcell chief Kaan Terzioglu, has cut a singularly assured figure with a David-and-Goliath tale about Turkcell taking on the ‘internet giants’, and winning. 

In an industry filled with uncertainty about its role in the digital world, Turkcell talks like a leader with a blueprint for digital reinvention. “Our ambition for global growth is driven by our digital services and our operational models,” comments Sezgin after the London session.

Sezgin, awarded Regional CTO of the Year at the Mobile Europe and European Communications event, is responsible for designing the technological foundation for Turkcell’s new services push. It has been a heavy workload, he notes, weighed down by the rapid rollout of a nationwide 4.5G radio network, which has included two-carrier aggregation, 4x4 MIMO and 256 QAM technologies from the start. 

Alongside this, Sezgin has devised twin NB-IoT and LTE-M capabilities, an upgraded 10G optical transport network, and faster fibre-to-the-home (FTTH). He has also layered in a flexible screen of virtualised and self-organising functions over the top. All his work has been geared towards a single goal: to remake Turkcell as a ‘digital services provider’. 

The arrival of 5G will consolidate its position, he says, by multiplying out both the user’s experience and the network’s capabilities. “Speed will generate data, and people and things will interact more. There will be vast opportunities for operators. All the tools needed to process data, and all the experiences created as a result, will happen at very high speeds,” he says.

 

Network service

Sezgin started at Turkcell a year after its foundation in 1995, as one of the company’s first network engineers. At the time, he had just completed military service, after an education in engineering at Istanbul Technical University, and a first job at the Turkish branch of equipment vendor Alcatel. 

Following a variety of senior roles in information and communication technologies, he was appointed Senior Vice President of Network Technologies in 2015, just as Turkcell was setting a new course. He has witnessed its development over two decades, and taken a closer role in its strategy. “It makes me proud,” he says, looking back. 

The single project that satisfied him the most is the company’s work on 4.5G, in late 2015 and early 2016, which kicked off the company’s technology revolution. “It is an exceptional source of pride,” he says. Turkcell was the first operator anywhere to launch a three-carrier 3G UMTS service, with download speeds of 63MBps; it wanted the same advantage in the 4G era. 

“So we built a future-proofed network infrastructure,” says Sezgin. It acquired the largest holding from the 2015 spectrum auction in Turkey. It now has 234MHz of spectrum across multiple bands, both paired and unpaired spectrum for frequency division duplex (FDD) and time division duplex (TDD). It is the largest FDD spectrum owner in Europe. 

“We had only a very short period to launch it following the tender. We used the time well,” he says. It invested in the latest capacity optimisation, higher order modulation and carrier aggregation techniques as standard. Its teams covered 790,000 square kilometres of Turkish countryside in the rollout, including hard terrains and rough climates. In line with the country’s ‘universal service’ law, it has sought to connect outlying regions, rolling out 4.5G services to 1,799 villages, where it already provides 2G coverage but skipped 3G altogether.

“Having captured the leadership, we have only strengthened our position since,” says Sezgin. Turkcell has achieved 90 percent population coverage, is one of just seven networks to achieve 1GBps speeds, according to the Global Mobile Suppliers Association, and was the second operator after Telstra to hit 1.2GBps.

In general, its baseline of broadband connectivity is bouncier in every way. Following tests of low-power wide-area (LPWA) technologies in early 2017, it flicked the switch on twin NB-IoT and LTE-M networks for Internet of Things services, notably for smart cities. It has LPWA pilots with water, electricity and gas companies, and partnerships for vehicle tracking and healthcare, as well as that strange and explicably popular IoT favourite, bee-keeping.

Sezgin’s team has enabled “end-to-end” redundancy in its optical transport network, he says, with sub-second convergence and seamless multi-protocol label switching. The undisputed king of fibre in its home market, Turkcell is offering multi-play over 10GBps FTTH services, with 3.1 million Turkish homes passed by the end of 2017.

 

Striking oil

It is a comprehensive scope of work, for sure. But the focus in the last 12 months, which Mobile Europe and European Communications recognised, has had rather less to do with radio and fibre data transport, and more to do with data storage. Operators must master every aspect of data handling, says Sezgin, if they are to re-emerge as digital providers.

“We have taken very important steps in our digital transformation over the last three years. The basis of it is data, which is like the oil of today. But producing data alone is not enough. What is important is to process it, keep it in our country, and ensure its security,” he says.

In line with the teachings of the new GDPR regulations in Europe, Turkcell has sought to keep its data close at hand. “Turkey’s data should stay in Turkey,” comments Sezgin. The company has spent TRY615 million (€97 million) on “next-generation data centres” since 2016; it opened its largest facility in İzmir, on the western shores of Anatolia, at the start of the summer. 

“Turkcell has become the largest data centre and cloud services operator in the country, while cementing Turkey’s goal to evolve into a global hub for data centres in the region,” comments Sezgin. Its total spending will climb to TRY2 billion (€316.2 million) by the time it has completed data centres in Ankara and Corlu by the end of 2019. 

Just as the demand being placed on its systems has become multi-faceted, its corresponding network infrastructure is suddenly labyrinthine. As per contemporary network operations, Turkcell is running a trio of networks across five different spectrum bands between 800MHz and 2.6GHz, with coverage supported by a combination of macro and small cells.

It has maintained KPIs for voice and data services, even as new network layers have been added during 2017. Nevertheless, its complexity requires simplification and Turkcell deployed a centralised SON platform to create order from the chaos, automating the most critical network functions.  “We are moving towards our goal of becoming a digital operator. Automation is an instrument of our 5G vision, as well. The whole industry has to automate to manage network complexity,” says Sezgin.

In behind, Turkcell has promised to virtualise 50 percent of its core network in its developing cloud set-up within three years. It has the infrastructure in place to deliver, he reckons, with an infrastructure capacity of 200GBps already virtualised on its data service network, and a cloud capacity of up to two million subscribers on its voice service network.

In terms of network functions, it has a stated target to virtualise 75 percent by 2020. Again, it’s on track, with six percent in the bag already, and a pathway to 18 percent by the year-end. It has established a centralised virtualisation infrastructure (NFVi), in the shape of its ‘unified telco cloud,’ and set about its Gi-LAN, EPC and IMS core, claiming “remarkable” gains in the process.

“We plan to virtualise all network components to have a more flexible architecture. Transformation from a customised, hardware oriented, vendor dependent structure to standardised, software oriented and vendor independent is one of the key means to make network components more flexible,” states Sezgin.

 

Switching off Netflix and drowning out Spotify

Turkcell has a line, which it repeats on the conference circuit and in trade discussions, about filling customers’ time with digital services. It talks about there being 1,440 minutes in a day, and taking a large number of them, each at a time. All of its infrastructure building and optimisation is geared towards this purpose.

Indeed, Turkcell’s singular vision about digital transformation is arguably more clearly grasped than by any European operator brand. Digital services and solutions will play a “bigger part in customers’ lives” than just phone calls and data sessions, and it wants part of the action.

“The data revolution has created trillions dollars of value. But not for the telecoms companies carrying the data,” Sezgin says. “In the last 10 years, OTT companies have used telecoms infrastructure to reach billions of users. Telcos have missed an opportunity. They have to change their minds to compete with the OTT providers.” Emboldened by its advancing technology, Turkcell is one such operator. “We can’t just act as a raw data handler,” he says. “We have to transform to a processed data services provider - to compete, and be on the winning side.”

The old operator community, which can appear encumbered by costly radio licences and expensive network infrastructure, have certain advantages in their relationship with data because of their history. They are more reliable and better trusted than internet companies, he suggests. “This will provide significant opportunities in the upcoming period.” 

But operators have to ready themselves first. “That’s what we have done in the last three years. We transformed into the world’s first real digital operator.” He describes a company that has moved decisively from bundling airtime to selling over-the-top services. “For Turkcell, real convergence is not about fixed and mobile but about infrastructure and OTT services.”

Turkcell has grown faster than any telecoms operator in Europe over the last two years, on the back of an expanding roster of digital services, which each rework familiar OTT templates for an expanding crowd. BiP is an instant messaging service like WhatsApp, fizy offers Spotify-like audio streaming, TV+ offers Netflix-style video streaming, and Yaani provides Turkish language search. It has introduced a personal cloud service called Lifebox, and a magazine syndication app called Dergilik.

Half of Turkcell’s 37.6 million subscribers already use its digital services and some of them are outrunning their better-known reference models in the Turkish market. “We have left behind Spotify and Netflix,” says Sezgin. There are cities in Anatolia, he says, where usage of BiP has caught up with WhatsApp. 

Yaani was downloaded a million times in its first nine days, and five million times in eight months since last October. Lifebox is Turkey’s most popular personal cloud service. More than five million magazines and newspapers are downloaded each month in Dergilik. Turkcell’s Hello Hope app, which enables communication between Turks and Syrian refugees in the country, has been downloaded half a million times and was lauded by the GSMA for its humanitarian credentials.

Turkcell has developed application tracking functions in its network to enable enhanced charging models that “favour” its own digital services, “to increase the take up rate and usage, which in the end improves loyalty and decreases churn”, as Sezgin puts it. In other words, it is slicing its 4.5G network up in order to enhance the experience with and drive loyalty to its own digital services. 

Sezgin explains: “Each individual service has different service level requirements in terms of throughput, delay, availability and so on. By designing a slicing structure - which is central to 5G, but which Turkcell has already implemented in basic form with 4.5G - each service is evaluated separately.”

 

Technological destiny

This service-based slicing has allowed Turkcell to manage and streamline the performance of its own digital products, and boost its overall numbers. “2017 was a year in which we reached important milestones in our digital transformation,” he says. These include a new digital brand, Lifecell Ventures, to disseminate Turkish content via operators around the globe.

“Turkcell wants to grow by making its services available globally. But not like these typical imperialistic digital companies. We want to build up a franchising model, where we gather our international affiliates under the roof of the Lifecell brand. We want to change the destiny of the telecoms industry,” he explains.

Lifecell Ventures is offering revenue sharing, white labeling, and operator branded solutions. It has started talks with Russian internet company Mail.ru, which commands more screen time in Russia than any other site, to boost its digital solutions and international reach. “We’re planning to exchange know-how and business experience to expand our global digital footprints.”

Turkcell has seen a rapid return on its gamble for reinvention. Its annual revenues jumped 17.5 percent in the first quarter, to TRY4.8 billion (€757.3 million), with 536,000 net additions, including 155,000 on contracts. Three in five of its 35 million plus customers take three services, at three times the ARPU, including at least one from its digital portfolio.

The work of Sezgin’s team in the background, in terms of radio upgrades, has enabled the company’s rebirth, and set it on a pioneering course with 5G. Its current investments in NFV infrastructure have created reusable resources, he explains, which can be used for architectural changes such as control and user-plane separation of EPC nodes and edge computing. 

“It has given us the edge to be one of the first operators in the world to implement latest features of 3GPP,” comments Sezgin. Turkcell has put “a lot of attention on 5G readiness” with its 4.5G activity during the past two years. It has already trialed 5G test equipment in the 71.5-73.5 GHz range, hitting top speeds of 70GBps. “It is one of the highest data transmission speeds ever achieved with 5G,” notes Sezgin. 

The company has tested and developed Massive MIMO techniques in its live network, also geared towards high speeds in dense areas and will be the first in the region to test techniques for FDD Massive MIMO systems. “In terms of product readiness most of our network is ready for 5G Release 15,” he says.

Now Release 15 is ‘frozen’, rubber-stamped for standardisation, Turkcell is to start testing ‘non standalone’ 5G with vendors, starting field trials immediately, and upgrading its core network to a fully SDN-enabled and NFV-based architecture in preparation for ‘standalone’ 5G. 

In the end, digitalisation is the most important issue, says Sezgin, and for any Chief Technology Officer. “As the world’s first digital operator, 5G means a lot for us - it’s not just a new technology, but a major step for network digitalisation. We need to make sure to create an end to end virtual network, which is software based, rather than hardware oriented,” he says.

There is work to do, however. “It can’t be done, end to end for the whole network, within the first years. It is very important to have a clear roadmap to transform into a fully software-centric, virtual entity,” he says.

This idea of the convergence of digital infrastructure and services must be put in process, by every function of the business. “We’re not just focused on the technical side of the 5G; we’re not only working as a technical team. We are united, with marketing, sales and digital services. We are creating a business oriented roadmap for 5G,” he says.

We speak before the financial turmoil that gripped Turkey in the late summer. Regardless of the uncertain situation within the country, the mood within Turkcell is confident, reflecting the status of the “world’s first digital operators”. Sezgin says: “Turkcell stands out; it operates with the spirit of a leader; it also positions me as a leader in my role, which I am very proud of.”

He rounds off: “Technology moves fast - what was a dream yesterday is a reality today. And mobile technologies, especially, occupy a special space. All the big stories revolve around data and intelligence. To be in the midst of this, to be working with these technologies, is very exciting to me.”

 

Judges’ verdicts

Bengt Nordstrom, CEO, Northstream said:

Spearheaded by its CTO, Turkcell has become well known for its commitment to technology and innovations. It has a strong track record of pioneering new services such as HSPA+ and VoLTE.

2017 has been a year of many important accomplishments of Sezgin and his team. Among the most significant ones to mention are: delivery of 1GBps mobile broadband service, 90 percent population coverage of 4.5G services in Turkey and becoming first operator in the world to offer to support both NB-IoT and LTE-M across its entire network.

Gediz Sezgin is recognised as a strong influencer of the telecom industry both in Turkey and internationally. In addition to driving 5G development in his native Turkey he is also an executive member of GSMA Technology Group and NGMN board.

 

 

Payam Taaghol, CEO, MYCOM OSI said:

Under the leadership of Sezgin, Turkcell is setting new standards in Turkey, the region and indeed the world, achieving many world firsts.

The network innovation has been outstanding - the 4.5G network rollout reaching 90 percent coverage of the population in Turkey at a speed up to 1.2GBps commercial traffic, the launch of VoLTE, VoWifi and SMSoIP and the adoption of the Enhanced Voice Service technology and of the Self-Organising Network are just some of the success stories worth celebrating.

Sezgin’s adoption of cutting edge technologies and innovative solutions has had a significant commercial impact on Turkcell, whilst the excellent performance and quality of the network and the expansion of the digital services offering have provided an impressive increase in customer satisfaction.