2013 declared as the Year of ICT was successful for Azerbaijan's ICT market. The sector growth was 20 percent in the country in 2013.
The Azerbaijani information and communication technology sector is one of the most dynamic of the national economy due to its profitability and general cost-effectiveness of this type of business. Despite the fact the main catalyst for the growth of the Azerbaijani economy is in the oil and gas sector, the ICT industry increases its potential each year.
According to the Azerbaijani State Statistics Committee, information and communication services worth 1.528.1 billion manat were rendered to organisations and the people of Azerbaijan in 2013 which is 10.7 percent more than in 2012.
Some 72.4 percent of the total volume of information and communication services accounted for services rendered to the population.
Around 59.1 percent of the total amount of revenue fell to mobile services.
The total amount of revenue from mobile services in the country amounted to 902.5 million manat in 2013, or 17.4 percent more than in 2012.
Azerbaijan's ICT market changed considerably in 2013. Some important achievements were observed in the broadband market after the appearance of such promising technologies as 4G developed in 2013. All this gives hope for further positive changes in this area this year.
2013 became a year of great achievements for Azerbaijan. The growth rate of the sector this year justified the predictions. This trend will continue in 2014. Launching the country's first telecommunications satellite Azerspace/Africasat-1a into orbit is one of the most significant and historical events in 2013 for Azerbaijan.
The prepared appropriate action plan announced as part of the Year of ICT in Azerbaijan in 2013 was successfully implemented. All problems were resolved. Many important projects are also planned to be implemented in 2014. Particular attention will be paid to the space industry, the development of broadband Internet and digital television.
Many important events were held in the country as part of the Year of ICT. This was the impetus for the development of the sector as a whole. In particular, the state electronic services were widely introduced.
An important event for the Azerbaijani Internet market is the broadband Internet development project financed by the State Oil Fund of Azerbaijan (SOFAZ). Besides the regional centres, the project which will start in early 2014, aims to expand coverage of broadband Internet into remote areas of the country.
2013 was also marked by the development of the Internet market in the country. In particular, the dynamics of Internet traffic use in Azerbaijan is breaking all records. The 60-fold growth has been observed in the country for the last 10 years. ADSL technology does not meet the needs of end users. The fibre optic infrastructure is rapidly developed in the country. Another important factor is the development of the mobile Internet. It exceeds the stationary access level. One can say that the ICT sector will develop in Azerbaijan in the future.
Azerbaijan is well ahead of neighbouring countries in terms of the ICT sector development. The situation with the legalisation of software in Azerbaijan today greatly differs with that in other countries. A positive trend affects a decrease in the illegal software market which has dropped to 86 percent for the past year. This is stipulated by the mass transition of the state organisations for licensed software.
Azerbaijan adopted a law on 'Ensuring intellectual property rights and combating piracy'. Its provisions must be complied by legal and physical entities.
The broadband Internet market growth exceeded 40 percent in Azerbaijan in 2013 and similar growth rates are projected for 2014. The forecast is based on the traffic volume delivered to final consumers which increased by 43 percent in 2013. The Azerbaijani Internet services market has already overcome the quantitative barrier and is on the verge of quality improvement.
The main obstacle to its qualitative development is the prevalence of copper cable infrastructure. Ultimately, it must be replaced by optical fibre networks. This will essentially solve the problem of the final mile.
Delta Telecom Company is implementing a large scale project laying fibre optic cable in Baku. The matter rests in several hundred kilometres of cables which will cover most of the buildings in the capital. This will increase the number of Internet users.
Key events of 2013
Launch of Azerbaijani first telecommunications satellite
The launch of Azerbaijan's first telecommunications satellite Azerspace/Africasat-1a in early February became the key and most significant event of 2013 in the ICT field.
The satellite was launched on February 8, 2013, aboard the Arian-5 ECA rocket from the Guiana Space Centre's ELA-3 launch complex. It then took its position in the geostationary orbit at 46 degrees east longitude.
The Arian-5 ECA rocket was manufactured by the French company Arianspace.
The satellite's payload is 36 transponders (24 C-band transponders and 12 Ku-band transponders).
Each transponder's frequency band is 36 MHz and the satellite weighs 3275 kilogrammes. Its lifetime is estimated at 15 years.
Azerspace/Africasat-1a satellite's service area covers the countries of Eastern Europe, Caucasus, Central Asia and North Africa. It was manufactured by the American company Orbital Sciences Corporation.
The Azerbaijani telecommunication satellite is also designed to render digital TV and radio broadcasting services, internet access, data transmission, creation of multiservice VSAT networks and government communications.
Azerbaijan's revenues from the implementation of the first satellite programme this year reached $10 million. Currently, the Azerbaijani satellite operator realised over 50 percent of the satellite's resources. Some 70 TV and radio channels are broadcast via the satellite, 19 of which are local.
Electronic security centre establishment
A decree on the activity of the electronic security centre under the Communications and IT Ministry was signed by Azerbaijani President Ilham Aliyev last March. The statute of the centre was approved by this decree.
The centre will coordinate the activity of entities of the information infrastructure in the field of cybersecurity, inform about existing and possible electronic danger at a national level and enlighten the public, private and other entities (users) in the field of cyber security.
The electronic security centre's measurements will be preventive by nature. The enlightenment will play an important role. A 'Hot line' will be created at the centre. It is planned to use a three-digit telephone number. Citizens can use it and receive the necessary recommendations on relevant issues related to the information security.
The centre will prepare the recommendations and define the criteria that must be met to increase the protection level and to protect the information bases from unauthorised intrusion. The centre plans to publish analytical reports and statistics for computer attacks, the number of fixed network incidents and virus activity.
The main purpose of preparing the report is timely informing the users about the threats. This will significantly reduce the damage from virus and hacker attacks. The report with recommendations on improving the level of information security of the systems will be prepared on the basis of an analysis of the information on already recorded incidents.
Mobile electronic digital signature platform
The Information-Calculation Centre of the Azerbaijani Communications and IT Ministry presented an authentication system for the 'electronic government' portal in early 2013 for using mobile devices (mobile phones and tablet computers).
The matter rests in an application that will deliver an access to the 'electronic government' portal by using mobile devices.
The new system enables the users to create digital certificates by using a two-factor authentication system and then gain access to the e-government (e-gov.az) portal by scanning the QR- code.
The 'ASAN Service' centre No 1 began issuing the mobile digital signature (ASAN-imza) at the beginning of the first six months. The new platform has been integrated with those of Azerbaijani mobile operators - Azercell Telecom LLC and Bakcell. It is necessary to change the Sim-card to use the mobile digital signature.
The mobile digital signature can be used in all kinds of mobile phones, as well as laptops and tablets. PIN-codes of SIM-card 'Asan-İmza' (Mobile ID) indicated on the SIM-card. They have an erasable layer. PIN1 code is required for personal identification, while PIN2 code is required only for a signature.
The first university in IT field
The University of Information Technologies was established to create highly qualified personnel to ensure an information society in Azerbaijan to meet the growing needs of the country for highly qualified personnel.
Enrolment to the IT University was announced in the middle of last year. Applications were accepted for information security, computer science, computer engineering, information technology engineering and systems.
The English language is taught at the IT University for the first year. Then, for the next four years applicants will be able to study their chosen profession in English.
Moreover, the Azerbaijani Communications and IT Ministry will assist the graduates in getting a master's degree abroad. The encouraging awards will be presented in the form of additional scholarships and participation in summer schools.
Start-up project support mechanism
The Azerbaijani State Fund for the Development of Information Technologies statute was approved in 2013. The State Fund prepared the mechanism for effective distribution of funds to support start-up projects (Start-up - a business idea, designed for rapid implementation). The concessional financing will be delivered for the issuance of loans and grants to stimulate activity in the ICT field in Azerbaijan through the State Fund.
All categories of the population will be able to benefit from the State Fund's advantages. The prepared criteria would allow the State Fund to effectively allocate financial resources to support innovative ideas. The necessary documents on this issue have been already prepared and approved by the Supervisory Board of the State Fund.
The first contests for start-ups are expected to be held in early 2014. The main purpose is to choose the most effective and potential projects in the ICT field. Small, medium and big loans and grants are expected to be issued through the State Fund for ICT Development to finance the projects.
The sum of small loans can range from 10,000 to 50,000 manat (a term issue is three years), medium - from 50,000 to 500,000 manat (up to five years), big - from 500,000 to five million (up to 10 years). The interest rate on loans will not exceed five percent per annum. The maximum grant amount may reach 300,000 manat for 36 months, small grants from 10,000 to 100,000 manat, medium from 100,000 to 200,000 manat, and big from 200,000 to 300,000 manat.
Five banks namely, Pasa Bank, Bank Respublika, Demir Bank, Rabita Bank and VTB Bank (Azerbaijan) have already been earmarked to finance the IT projects, but this list may be extended up to 10 authorised agents by the fund.
New Baku High-Tech Park
A Business Incubation Centre 'High-Tech Park' was founded in Baku. There is to be an incubation centre and the park's head office based at the centre. ICT projects were being accepted from January 2014 and the centre's activity will be based on two principles.
The first, the so-called 'open office' will allow working on one specific project individually. The second principle, the 'shared office, can include up to five companies. Each company can work on a project in a team.
Participants at the business incubation centre will be provided with computer equipment and Internet access. If necessary the centre will be ready to provide the necessary support for the project initiators. Only prospective projects can claim for development at the incubation centre. After the project reaches the desired stage of development, the transition to the start-up projects at the 'High-Tech Park' will be move to another step.
It is planned to construct park in Pirallahi district of Baku. A 50 hectare plot has been allocated for its construction. Currently work is underway to create the park, to construct the necessary infrastructure, to study international experience and to resolve other issues.
