By Ronan Shields
Qatar is the last telecoms market in the GCC to liberalise, and the process there is beginning to gain momentum. The country’s telecoms regulator, ictQATAR, recently announced plans to open bidding for the country’s second mobile and fixed-line networks and William Fagan, ictQATAR’s executive director, explains the details.
Market liberalisation|~|ictQatar.WilliamFagan.200.jpg|~|ictQATAR's executive director William Fagan believes the auction process is the most transparent method of spectrum allocation. |~|Qatar is the last telecoms market in the GCC to liberalise, and the process there is beginning to gain momentum. The country’s telecoms regulator, ictQATAR, recently announced plans to open bidding for the country’s second mobile and fixed-line networks and William Fagan, ictQATAR’s executive director, explains the details.
CommsMEA: What prompted ictQATAR’s decision to invite offers to liberalise the telecoms market?
William Fagan: Regionally there is a growing appreciation that competition is the best way to achieve high levels of investment in the telecoms industry in the interest of both the consumer and enterprise segment.
Qatar is a rapidly expanding country, both in terms of its economy and population, and to support this development we decided that a competitive, modern, state-of-the-art market and network infrastructure was required.
CommsMEA: What do you anticipate to be the social and economic benefits of this move for both the country and any prospective operator/s?
WF: Most countries in the world have liberalised telecoms infrastructure and the invitation to run our mobile network, which was released in April, was the first step to be included in this trend.
CommsMEA: What regulatory tools will you utilise to make the market more attractive to prospective newcomers?
WF: Qatar already benefits from a highly developed telecoms market with high levels of penetration in both the fixed-line and mobile segments.
In terms of the social benefits, we believe the country’s educational establishments and governmental organisations, as well as the general population, will benefit from increased levels of connectivity that market competition will offer.
On the economic side of things, we believe increased telecoms infrastructure should aid the diversification of the economy as many enterprises demand highly developed ICT services.
In terms of the prospects for a market newcomer, we believe that Qatar offers a strong opportunity for growth as it has the highest GDP in the Gulf. Additionally, the population is set to increase from 900, 000 in 2007, to 1.4 million by 2015, thus enhancing its attraction to prospective network operators banking on the growth of the market.
Qatar also has a highly sophisticated market in terms of the demand for communications products and services in both the residential and enterprise segments, so a new entrant should have little problem with users wanting to access products and services made available.
CommsMEA: What will be the nature of the bid process for the licences?
WF: Firstly, the licences will be transparent in terms of the criteria each company will have to meet. Secondly, we will leverage all of the standard regulatory tools used elsewhere, such as spectrum allocation, and we will clearly demonstrate the obligations on each player from the beginning.
Many companies are hesitant to enter a market where there is a strong incumbent operator but we will address any issues of dominance within the market purely in the interests of promoting competition.
This can take place across a number of areas such as ensuring interconnection fees are charged on a cost-basis. We also have powers in relation to dispute resolution.
CommsMEA: What will be the timeframe of the process?
WF: The pre-qualification phase will take place up until May 27, 2007, and the criteria that applicants must meet are set out in our Mobile Pre-Qualification document.
All successful applicants will be forwarded to the final stage of the process and that will be an auction process. We will publish the final mobile application process in late June, or early July of 2007, and following a consultation process with the industry the announcement of the eventual winner will take place in Autumn 2007.
Hopefully the rollout should begin next year, although the agreed timeframe with the operators will be finalised when the licences are granted.
Many operators might slate the auction process, as they think it is too costly, but ultimately it is the most transparent way of allocating spectrum and putting a true value on the licence.
We are contemplating holding a beauty contest for the fixed-line network licences where we will ask the bidders to set themselves targets, in terms of the time frame of the rollout, in which case we would then hold them to these deadlines.
CommsMEA: What is the business case for a prospective operator given that mobile penetration has already surpassed 100% In Qatar?
WF: This question is often raised here and in other markets as well but we have seen no lack of interest so far. There are a lot of ways a company could address a market with conditions like this but it is not up to us to dictate how they do so.
However, I would point out that the growing population in the country would add value to the licence and that we will be make mobile number portability an obligation to all market players.
If the correct strategy is adopted by an operator, 100% mobile penetration should not necessarily stand as barrier to market newcomers.||**||