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Azerbaijani IT sector (January-July 2014)

Analysis Materials 10 September 2014 15:32 (UTC +04:00)

The Azerbaijani information and communication technology sector (ICT) is one of the most dynamically developing sectors of the national economy due its profitability and total profitability of this business. Although the main catalyst for the growth of Azerbaijan's economy is the oil and gas sector, the ICT sector also increases its capacity every year.

Information and communication services worth $862.3 million AZN were rendered for Azerbaijan's population and organizations in January-July 2014, according to a report from Azerbaijani State Statistics Committee.

This figure is 12.4 percent more than in the same period of 2013.

The statistics committee said some 72.5 percent of information and communication services were rendered for the population, while 60.2 percent of the total income was received from mobile services.

Total revenues from mobile services rendered in Azerbaijan stood at 518.9 million AZN in January-July, which is 9.3 percent more than the figures for same period of 2013.

Internet

According to the Azerbaijani Ministry of Communications and High Technologies, 73 of every 100 people in Azerbaijan are Internet users, 55 - broadband Internet users. Some 62 of 100 people in Azerbaijan are computer users.

The total capacity of international Internet channels reached 250 gigabits per second due to the people's growing needs of the Internet and as a result of technical operations.

Currently, 10-12 digital television channels are freely broadcast at 97.5 percent of the country's territory. Some 110 mobile numbers fall to every 100 people in the country.

Broadband connections within the network of Baku Telephone Communications Production Association rose by almost two times since early 2014.

The production association noted that as of August 1, 2014, the total number of connections, taking into account the ports of private service providers, has reached 400,000, more than half of whom being users of state-run internet provider BakinterNet.

Azerbaijan state-run communications operator has started to provide services to end-users for access to the internet via fiber optic lines with the help of the technology known as FTTH (Fiber to the Home).

FTTH has an abundance of capacity, and data transmission speed is dozens of megabits per second, and can be distributed among home users.

Using the asymmetric digital subscriber line (ADSL) home users get from 2 to 8 megabits per second (quality depends both on the telephone line's condition and the distance to the nearest automatic telephone exchange), however with the FTTH the data transmission speed will vary from 10 to 100 megabits per second.

e-commerce

The market for electronic commerce (e-commerce) in Azerbaijan amounted to 1.5 million AZN in January-July 2014. Compared to the same period of 2013, the total retail of e-commerce in Azerbaijan rose by 10.2 percent.

E-commerce market participants are legal and physical entities engaged in electronic commerce and buyers of goods and services. Total retail sales in Azerbaijan in January-July 2014 amounted to 11.8 billion AZN. The sales of consumer goods in the country grew by 9.1 percent compared with the same period of last year.

Some 78.3 percent of goods purchased in electronic form by the population of Azerbaijan during reporting period, was bought by legal entities and 21.7 percent - by physical entities. Non-food products accounted for 90.3 percent of e-commerce market turnover.

About 50.5 percent fell to consumer goods (food, beverages and tobacco), and 49.5 percent AZN - to non-food products. The share of non-food products increased by 3.3 percentage points during the reporting period.

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