At last month's GSM>3G Middle East conference in Dubai, at which I had the pleasure of moderating a number of the sessions, the panel of speakers included Farid Lekhal, Chief Commercial Officer at Vodafone's Partner Markets business unit. I hope his comments on mobile broadband added a useful perspective for an audience largely representing telcos headquartered in the MENA region. MENA operations in which the Newbury, UK-based giant cellco has equity currently only number two. Vodafone Egypt is an established outpost of the company's global empire. Much newer is the operation in oil and gas-rich Qatar, where I believe services are expected to be launched in March this year.
Notwithstanding Vodafone's recent foray into Qatar, My guess is that across the Middle East the entry of a group with European roots to any market selling further licenses will be comparatively rare going forward. It looks far more likely that MENA-based groups will continue to grow their footprints in the region. One recent example: Saudi Telecom acquiring Bahrain's third mobile licence for USD 230 million, according to yesterday's report from Gulf News. The story indicates that three other firms had registered interest in the auction, something which Global Mobile Daily told me only eleven days ago in a piece which led me to infer that the Bahraini regulator was planning to launch a lengthier tender process. However, yesterday's Gulf News piece suggested that STC's bid was the only one received. The story also reveals the previously unknown prospective bidders, indicating that Mohammed al-Amer, Chairman of the Telecommunications Regulatory Authority of Bahrain, had said these named Bahrain's TwoConnect and Mena Telecom as well as a consortium including France Telecom subsidiaries Orange and Jordan Telecom.
Another major intra-regional move was the recent win in Iran by the Etisalat, where the UAE-based telco has snapped up the country's third national mobile licence. My colleague Matthew Reed, Editor of our Middle East and Africa Wireless Analyst publication, feels the deal was a bargain, noting that the license fee was only US$399 million, of which Etisalat is paying 49%, in line with its 49% stake in the consortium that won the license. Etisalat’s local partner is Tameen Telecom, an Iranian public-sector investment fund. Matt notes that the new operator will reportedly pay 23.6% of revenues to the Iranian government, though MCCI and MTN Irancell pay 28%.
Matt feels that Etisalat's new operation will enjoy - and exploit - the significant competitive advantage conferred by its licence, which confers the right to be the only 3G operator in Iran for two years. Matt notes that "perhaps more than any of its peers, Etisalat has put new technology at the heart of its strategy, saying that in this way it can future-proof itself because it will be able to offer the most up-to-date services and because the latest systems are cheaper in the long run."
Matt points to the example of Egypt, where Etisalat launched a 3.5G network on its debut in the country in May 2006, becoming the country’s first 3G operator. In Egypt, Etisalat had the 3G market to itself only briefly, since Vodafone launched its own 3G network within a couple of weeks, and Egyptian market leader Mobinil launched a 3G network in September. In Iran, Etisalat will look to make the most of a much longer period of 3G exclusivity.
Matt notes that "when Etisalat launches services - in six to nine months, according to company executives - it will most likely offer HSDPA services from the outset, as it did in Egypt." Matt feels this will enable Etisalat to offer data services such as mobile broadband and target Iran’s largely untapped broadband market, without any meaningful competition.
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HSPA subs growing in Saudi Arabia; market developments in slow-to-liberalise Kuwait
While I was moderating conference sessions at this month's GSM>3G Middle East conference in Dubai, I had the pleasure of introducing a representative of Saudi cellco Mobily to the audience.
Mohamed A. Radwan heads up the development of the MNO's chain of retail outlets and told conference participants about the company's approach to promoting all 3.5 G capabilities and VAS. According to the notes I made on the day, Mohamed did not share numbers regarding HSPA subscriber growth. I was therefore interested to see this question addressed in an edition of Global Mobile Daily last week. The Informa Telecoms & Media research service says that the number of Mobily's HSPA-based subscriptions has reached 300,000, having acquired this number of subs in the 18 months since launching a mobile broadband bundle in May 2007. Mobily charges SAR350 per month (USD 93.40) for the service and also has higher usage bundles on offer - 5GB for SAR200 and 1GB for SAR200.
The same issue of GMD picked up news of Kuwait's Ministy of Communications moving to reduce the cost of calling several European and Arab countries. The MoC has a free hand in such matters. The market is the least liberalised in the MENA region: fixed line network operations remain the exclusive preserve of the MoC itself and the Gulf state has no independent regulator.
The mobile space in Kuwait is rather more competitive, even more so since the September 2008 launch of Saudi Telecom-backed Viva, the country's newest cellco. It will be interesting to see how this third entrant fares on a market described in the abstract of my friend Paul Budde's country profile as having "[high] prices... across all sectors of the market" and a "comfortable duopoly enjoyed by Zain and Wataniya [which] has enabled them to build on their strong base to expand aggressively internationally to compete on a global scale."
Something I didn't know ahead of writing today's entry was that until very recently, Kuwaiti mobile users have had to pay to receive incoming calls. I just stumbled upon this personal blog, which reported earlier this month that Viva had broken the mould by implementing a pure Calling Party Pays model. From the comments which this entry prompted on the blog, it looks like Zain moved to introduce CPP a mere 12 hours later. I am not clear if Wataniya has done likewise or plans to do so. Warning: if you do follow the link to the blog which picked this up, prepare yourself for reader comments expressed in pretty strong language and people whose criticisms of Kuwait's operators are much less diplomatic than anything you will ever read here!
If this information is to be believed, it does suggest that Paul Budde's comment about a "comfortable duopoly" might not have been too wide of the mark - and that this duopoly has been quickly attacked by the new entrant.
I am not clear when Kuwait plans to set up an independent regulator. Global Mobile Daily suggested as long ago as August 2007 that this was a work in progress and set to be discussed "during the next National Assembly session." I haven't seen news of any developments since then and when a colleague of mine went on a fact-finding tour of the Middle East earlier this year, I do remember a number of his research respondents expressing frustration about the pace of helpful change in the country.
I can't pretend to know enough (yet!) about the MENA region to understand why the speed of evolution towards more progressive regulatory regimes is so uneven across the various markets. In Dubai this month, I certainly got the sense that things are moving faster in some states. One example would seem to be Bahrain, whose regulatory agency sent Deputy Director Tomas Lamanauskas to speak at our conference. I asked Tomas how a Lithuanian had ended up at the Bahraini regulator and learned that he had made the move from the equivalent body in his home country. Tomas told me that to some extent, his new employer is seeking to create a regulatory regime which resembles the EU framework. Tomas replied affirmatively when I asked if, in a sense, his latest role had something in common with the job of harmonising Lithuania's regime to the European framework, something which I remember being a big topic of conversation a CEE region conferences some years ago, not least among delegates from then soon-to-be EU accession states.
Mohamed A. Radwan heads up the development of the MNO's chain of retail outlets and told conference participants about the company's approach to promoting all 3.5 G capabilities and VAS. According to the notes I made on the day, Mohamed did not share numbers regarding HSPA subscriber growth. I was therefore interested to see this question addressed in an edition of Global Mobile Daily last week. The Informa Telecoms & Media research service says that the number of Mobily's HSPA-based subscriptions has reached 300,000, having acquired this number of subs in the 18 months since launching a mobile broadband bundle in May 2007. Mobily charges SAR350 per month (USD 93.40) for the service and also has higher usage bundles on offer - 5GB for SAR200 and 1GB for SAR200.
The same issue of GMD picked up news of Kuwait's Ministy of Communications moving to reduce the cost of calling several European and Arab countries. The MoC has a free hand in such matters. The market is the least liberalised in the MENA region: fixed line network operations remain the exclusive preserve of the MoC itself and the Gulf state has no independent regulator.
The mobile space in Kuwait is rather more competitive, even more so since the September 2008 launch of Saudi Telecom-backed Viva, the country's newest cellco. It will be interesting to see how this third entrant fares on a market described in the abstract of my friend Paul Budde's country profile as having "[high] prices... across all sectors of the market" and a "comfortable duopoly enjoyed by Zain and Wataniya [which] has enabled them to build on their strong base to expand aggressively internationally to compete on a global scale."
Something I didn't know ahead of writing today's entry was that until very recently, Kuwaiti mobile users have had to pay to receive incoming calls. I just stumbled upon this personal blog, which reported earlier this month that Viva had broken the mould by implementing a pure Calling Party Pays model. From the comments which this entry prompted on the blog, it looks like Zain moved to introduce CPP a mere 12 hours later. I am not clear if Wataniya has done likewise or plans to do so. Warning: if you do follow the link to the blog which picked this up, prepare yourself for reader comments expressed in pretty strong language and people whose criticisms of Kuwait's operators are much less diplomatic than anything you will ever read here!
If this information is to be believed, it does suggest that Paul Budde's comment about a "comfortable duopoly" might not have been too wide of the mark - and that this duopoly has been quickly attacked by the new entrant.
I am not clear when Kuwait plans to set up an independent regulator. Global Mobile Daily suggested as long ago as August 2007 that this was a work in progress and set to be discussed "during the next National Assembly session." I haven't seen news of any developments since then and when a colleague of mine went on a fact-finding tour of the Middle East earlier this year, I do remember a number of his research respondents expressing frustration about the pace of helpful change in the country.
I can't pretend to know enough (yet!) about the MENA region to understand why the speed of evolution towards more progressive regulatory regimes is so uneven across the various markets. In Dubai this month, I certainly got the sense that things are moving faster in some states. One example would seem to be Bahrain, whose regulatory agency sent Deputy Director Tomas Lamanauskas to speak at our conference. I asked Tomas how a Lithuanian had ended up at the Bahraini regulator and learned that he had made the move from the equivalent body in his home country. Tomas told me that to some extent, his new employer is seeking to create a regulatory regime which resembles the EU framework. Tomas replied affirmatively when I asked if, in a sense, his latest role had something in common with the job of harmonising Lithuania's regime to the European framework, something which I remember being a big topic of conversation a CEE region conferences some years ago, not least among delegates from then soon-to-be EU accession states.
- Label: Bahrain, Calling Party Pays, HSPA, Kuwait, Lithuania, Mobily, Saudi Arabia, Saudi Telecom, Viva
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