It’s been a busy couple of weeks for the mobile sector in the Middle East, led by the launch of a new operator in Kuwait and the licensing of a third player in Iran. These announcements bode well for the continued growth prospects in the region, led by activities in the Persian Gulf region.
The biggest news was that UAE-based Etisalat had secured Iran’s third national digital cellular licence. The regional mobile powerhouse has agreed to pay EUR300 million for its 2G/3G licence. With a penetration rate of 55%, there remains considerable room for the newcomer to prosper.
Meanwhile, Kuwait’s third mobile network – VIVA – has gone live, after equipment supplier Huawei handed control over to the new player. Kuwait is an intensely-competitive market, however, with tier-one player Zain locked in competition with privately-owned Wataniya Mobile. It remains to be seen whether VIVA will be able to make much headway in this environment.
Zain itself renewed a contract to manage of one of two state-owned Lebanese mobile operators. The Lebanese government has long delayed plans to privatise the operators, which have the highest tariffs in the region. The contracts are valid for a one-year period; continued trouble-free stewardship would count in Zain’s favour should it wish to buy the operator whenever privatisation plans are restarted. Meanwhile, Orascom Telecom gained control of the second operator. Mobile penetration stands at around 26%.
A third mobile operator will be licensed in Bahrain in the near future. One bid has been submitted for this licence. Thus, Saudi Telecommunications Company (STC) could find itself with a foothold in ‘the first fully broadband-enabled economy in the world’: this, at least, is the belief of incumbent Batelco, which last week said it had completely replaced its legacy analogue network with an IP-based NGN platform and has announced it is partnering with regional investment companies to take a 49% stake in S-Tel, a company that holds unified access licences to provide telecoms services in certain areas of India.
Finally, 3G licences for Jordan have been put out for tender. Existing players such as Zain and Orange will likely bid for these licences.
Juniper Research believes that the Middle East has witnessed dramatic growth in take-up and usage of mobile services over the last five years. However, many Gulf States have now exceeded 100% penetration and these petrodollar-rich companies are looking overseas for growth and are buying existing operators and new licences in neighbouring states as well as in Africa and Asia. The last fortnight’s news reinforces our beliefs in this regard.
Tags: 2G, 3G, Africa, Alfa, Asia, Bahrain, Bahrain Telecommunications Company, Batelco, broadband, circles, digital cellular, Etisalat, forecasts, GCC, Gulf Co-operation Council, Huawei Technologies, India, IP, Iran, Jordan, juniper research, Kuwait, Lebanon, licensing, Middle East, mobile, mobile broadband, mobile network operators, MobileCom, MTC Touch, NGN, Orange Jordan, Orascom Telecom, penetration rate, Persian Gulf, privatisation, regulation, S-Tel, Saudi Telecommunications Company, STC, telecommunications, telecoms, UAE, United Arab Emirates, VIVA, Wataniya Mobile, Zain
