Mobile operators — Kyivstar, Vodafone, and lifecell — know everything about Ukrainians: who they are, where they are, what they like and even how they spend their money.
These carriers are the only providers of the mobile internet, 3G and 4G, in Ukraine. And since nearly 70% of Ukrainians use mobile phones to surf the web, operators know a lot about these people, including apps they use, their location and data about their phone calls.
The operators collect this information, store it and process it with algorithms. They call it big data. And although the legal status of such information is yet to be defined, telecom players have already started using big data to earn big cash.
Kyivstar, for example, which services 26 million SIM-cards, has implemented over 470 data-driven projects, which already secure 1% of the carrier’s revenue. The company wants big data services to secure 6% of its revenue in the future and sees that other businesses are willing to pay to understand their customers better.
The government, in turn, can use big data to digitize city services or develop smarter infrastructure, including tracking public transport and using smart CCTV cameras to locate criminals.
Diverse market
Competition on the telecom market is growing and revenues from voice calls and text messages — once the main revenue drivers — have declined in recent years. This means they need to find new sources of revenue.
This is where big data has become an enticing way to secure the future for telecom operators, experts say.
“We know for years in advance where we will be, which technologies we will use and how they will help us,” says Sergey Borislavskiy, head of revenue management and big data at Vodafone Ukraine.
At first, telecom operators used big data for internal purposes: to develop marketing strategies, prevent user outflow and eliminate technical problems. They tracked how subscribers used their own services and offered convenient mobile plans.
In the telecom market, information has quickly become the new oil — profitable, but still untapped.
Borislavskiy says only the most developed companies have started using the data-driven services. Although the technology is relatively new, all three mobile operators said that it is growing exponentially.
Vodafone Ukraine collects one thousand terabytes of customer data a day, which is around 200,000 iPhone photos. Big retailers, fitness clubs, gas stations and financial institutions buy these data from the operators.
Kostiantyn Vechir, business-to-business director at Kyivstar, says it’s a “global trend in telecommunications.”
Showing trends
To give businesses the expected results, big data should meet certain criteria: be relevant, complete and accurate.
“Data itself does not mean anything. What’s important is the information you glean from it,” Veronika Tamaio Flores, head of consulting at Ukrainian think tank Data Science UA, says.
Mobile operators analyze big data daily and offer dozens of services. Using big data, carriers can create for a given business a portrait of its average client or predict which kind of customers will buy products in certain areas of the city.
Banks, meanwhile, can use the data to create credit scores to predict if potential lenders will likely fail to pay off their debts. Ukrainian banks Pravex Bank and Monobank use big data from Kyivstar for that purpose. And Monobank has increased its ability to detect distressed borrowers by 66%.
The demand for big data is also surging in the retail industry as the market becomes competitive and companies offer more personalized services.
The Fozzy Group, which owns supermarket chain Silpo, has used big data from Vodafone to forecast demand, manage the supply chain and minimize financial risks.
For Prostor, one of Ukraine’s popular beauty product chain stores, Kyivstar has generated a portrait of the ideal client — a woman aged 35–45 who goes to Prostor because she lives nearby. This helps the store chain to better target its main customers and make more money.
The price of a big data services depends on the scale and complexity of the analysis.
Building a smart country
Although the information is an accessible source of revenue for mobile carriers, they still work pro bono with governments and cities.
“City actively uses our services because without them they cannot govern efficiently and understand what is happening around them,” Vodafone’s Borislavskiy says.
The three mobile operators have cooperated with Kyiv’s authorities to develop smart infrastructure, track passenger traffic and manage tourism facilities.
By tracking the subscribers’ locations, operators can predict which roads will be overloaded at different times and how much transport the city needs to avoid traffic jams. Mobile operators can also track the number of people leaving and entering the country to decide on where to open new border checkpoints.
In case of emergencies, mobile carriers send citizens news flashes to warn about road repair, extreme weather conditions, or, as in the case of COVID‑19, to remind them about quarantine restrictions.
Ethical issues
But there’s a problem. Nobody wants to be surveilled all the time. Many people worry that their personal information will leak and someone will use it to take unlawful loans out in their name, rob or stalk them.
However, experts and operators claim that data is depersonalized and protected, meaning that businesses receive a summary of the analysis rather than the characteristics of every single user.
“For big data analysis, (only) the scope of the information is fundamental,” Borislavskiy says. “The data of an individual device or personal data has no value for big data analytics and algorithms,” Borislavskiy says.
Besides, Ukraine has two laws to regulate the processing and distribution of data in Ukraine, “On Information” and “On the Protection of Personal Data.” They prohibit mobile operators to sell or give detailed data about users, including call recordings, text messages, and browser history to third parties. That is why operators can only provide general information about their subscribers.
Big data does not boil down to the targeted advertising of goods and services. Used on a broader scale, it could also prevent crimes, improve city services, and allow authorities to prepare for disasters, its advocates say.
“The way businesses approach big data can only benefit cities and citizens,” Tamaio Flores says.
