Ukraine’s households boost profits for booming ISP market

Dmytry Hryshchuk is founder of a broadband Internet provider in Kyiv that is building its own infrastructure independent of state monopoly Ukrtelcom.
He, established his IPNET Company in 2001 at the age of 24, a year before he received a degree in international business administration from Kyiv National Economic University.

KP: Can you tell us a little about your company, what kind of Internet services does your company provide?
DH: IPNET is one of the largest Internet providers in Kyiv. We entered the telecommunication market in 2001 and started our work mainly in Kyiv’s Obolon district. Today, our renovated fiber­optic network covers the whole of Obolon, Nova Darnytsya and Kharkivskiy areas. The IT magazine Komputernoe Obozrenie (Computer Review) called IPNET one of the largest Internet providers in Kyiv with the data transmission speed of 100Mbps. In 2008, the number of our subscribers topped 14,000.

KP: What has changed since you started the company? Are Ukrainians becoming more sophisticated Internet users?
DH: When we first started working in Kyiv, the competition was fierce. There were more than 120 Internet service providers (ISPs). And all they could offer was dial­up access. Leased­line data transmission speed was really slow and only big companies could afford it.
Now the situation is totally different because of the city’s increasing level of computerization. Currently more than 200,000 homes are using high­speed Internet access due to new technological opportunities that opened in recent years. The main trend we can observe is that Kyivians want to read the freshest news and they get it through the Internet. The Ukrainian Internet service provider market skipped many early developmental stages other countries in the world went through. We are implementing the best of what has already been tested in the world.

KP: Does your company provide any special services for corporate clients?
DH: Right now we offer our services in the areas where, for the most part, home users are located. But we would be more than happy to offer technical solutions for corporate clients. IPNET’s technical capacity allows us to meet our clients’ most difficult challenges.

KP: Do you think there is room for new companies on the Internet service provider market?
DH: Even though competition is fierce, nothing is impossible if you decide to enter a particular market sector. Talking about new companies I would say that, of course, experience plays a big role in doing business in Ukraine, but if a company can offer some innovative solutions and has a professional team, it could work.

KP: How has the technology changed compared to 2005? What have the biggest changes been?
DH: We live in a unique time when even the most extraordinary ideas can become reality. For our clients it is not important how they get Internet access but how fast and good it is.

KP: What are the main trends in the Internet service provider market?
DH: Broadband Internet access is the main trend. It has become the most popular type of Internet access. Also, the number of Internet service providers is growing as prices are falling. Starting this year, there is a vast increase in household broadband users not companies, and the revenues from such users will exceed income from corporate users.

KP: What is your forecast for the next one or two years?
DH: I can forecast an active development of the Internet service provider sector, voice mail and IPTV in Ukraine. More and more innovative services will come to Ukraine from the more technically advanced countries.

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