Telecommunications sector in Azerbaijan is the second largest recipient of foreign investment after oil industry. The largest FDI stock is in the mobile telephony followed by a number of enterprises with foreign capital in landline operating companies, internet providers and cable TV companies. Foreign capital inflow into the telecommunications industry is in the form of joint ventures with the entities subordinate to the Ministry of Communication and Information Technologies which acts both as a partner and a supervising authority.
The telecom market is also one of the leading sectors contributing to the economic growth. In 2010, the sector grew by 29.7%. Further development of the legal framework aimed at liberalization of the market has provided substantial business opportunities for foreign companies. There are four mobile operators in the country: Azercell , Bakcell, Azerfon and Catel. There are 9.1 million cell phone subscribers in Azerbaijan with mobile penetration reaching 100% in 2010. A network of 30 ISPs serves 3.7 million internet users in Azerbaijan. The country’s internet penetration rate is 50%.
Establishment of regional innovation zones (techno-parks) with a strong research component that will promote innovation entrepreneurship as well as production and export of electronic equipment and software is one of the sector’s medium-term goals.
The Government sees the development of the space industry as part of its broader plans to transform Azerbaijan’s information communications technologies sector into a highly-competitive industry. Azerbaijan will be the first country in the South Caucasus to launch a 16-transponder satellite in 2012 in partnership with a US-based contractor Orbital Sciences Corporation The satellite will include intra-governmental mobile telephone communications, television, radio and internet broadcast capabilities and will be accessible in Europe as well as Central and South-East Asia.
Azerbaijan is also one of co-sponsors of the UN resolution on Building connectivity through the Trans-Eurasian Information Super Highway aimed at promoting the development of ICT infrastructure and e-commerce throughout Eurasia.
