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RISING COSTS: Al Barrak admits that the high oil price has hit Zain’s operational expenditure.

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Kuwait-based operator Zain boasts year-on-year customer growth of over 50%. Managing director Saad Al-Barrak tells Andrew White why the telco is set for even greater success both at home and abroad.

This is a big year for us," smiles Saad Al-Barrak. "But then you could say that about every year for a company like ours."

The managing director and deputy chairman of Kuwait-based telco Zain could point to a host of financial statistics to back his claim. He could highlight year-on-year customer growth of 54%, representing 45.7 million active customers.

Or he could just point to a map of the Middle East and Africa, across which Zain - formerly MTC - is active in no less than 22 countries.

Yet while this year will see that network spread further across the globe, Zain also faces a territorial battle both at home and in the lucrative Saudi market.

Zain Saudi Arabia - the kingdom's third mobile phone company - will be operational by August, according to Al-Barrak, who is reluctant to set performance targets for the new venture.

"We have to test the market to start with, and Saudi is already a very developed market with two very aggressive and established companies," he says. "The competition won't be easy, and I am not a person to overpromise - in the first year we will look at things and then set targets."

It is expected that the company's network will initially only cover 53% of the population, but it will coordinate with rivals Saudi Telecom Company (STC) and Mobily to provide wider coverage.

Zain plans to depend fully on its own infrastructure within three years of its launch in Saudi Arabia, and having spent US$6.16bn on the licence, the operator will be looking to take a healthy slice of the kingdom's burgeoning multi-billion dollar telecoms market.

Meanwhile, STC will be entering into Zain's own backyard with the launch of Kuwait's third mobile phone company in a US$907m concession.

STC will go up against incumbent telcos Zain and Qtel subsidiary Wataniya in a three million-strong market where mobile penetration stood at 104% as of 2007, according to a recent report by Dubai-based research firm Delta Partners.

"We love competition and we thrive on it," shrugs Al-Barrak. "Competition can only show the better face of Zain and we have great cooperation with STC in both Kuwait and Saudi, with network sharing and so on.

Let the customer decide whom they want to be associated with; we and STC are familiar friends."

Such avowed bonhomie aside, Zain will hope that the increased competition does not infringe upon the bottom-line growth it has worked so hard to achieve.

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