Egypt may open 4G to new bidders

By:
Alan Burkitt-Gray
Published on:

With Etisalat, Orange and Vodafone all turning down 4G licences, Egypt says China Telecom, STC and Zain may be interested if there is a new auction

Egypt’s three foreign-owned mobile operators have started a battle with the country’s telecoms regulator after they turned down the opportunity to buy 4G licences.

Etisalat, Orange and Vodafone are all claiming that there is inadequate spectrum on offer and that the current terms favour state-controlled operator Telecom Egypt, which agreed to buy a 4G licence in July for $800 million.

According to the Bloomberg news agency, the National Telecommunications Regulatory Agency (NTRA) is planning to set out the terms for new 4G licences, a move that may open the way for other operators to move into the market.

Mustafa Abdul Wahid, president of the NTRA, agreed that the spectrum on offer was “not enough” for 90 million users, but said that it was a starting point. He said the existing terms for a 4G spectrum licence were now withdrawn and would not be offered again.

A number of reports have suggested that other companies, including China Telecom, STC of Saudi Arabia and Zain of Kuwait, might be interested in bidding for a 4G licence, citing an unnamed telecoms ministry official.

Arabiya TV quoted Yasser El Qady, Egypt’s telecoms minister, as saying Telecom Egypt will go ahead with 4G services. Telecom Egypt owns 45% of Vodafone Egypt, a stake it is expected to sell if both companies offer mobile services in the market.

Vodafone Egypt said: “We want to launch 4G in Egypt as soon as possible, but to do so the conditions must be right.”

The company added: “After extensive analysis, Vodafone Egypt’s Board of Directors regrets to say that it believes the current terms and conditions of the 4G licence do not serve the interests of the Egyptian citizen and do not take into account the developmental dimension of the telecom sector in Egypt.

“The licence does not offer sufficient spectrum to operate 4G services efficiently and in a way that would allow the Egyptian user to experience significantly higher speeds. Furthermore, the lack of available 4G spectrum could also impact the quality of 2G and 3G services being enjoyed by over 40m existing customers. Accordingly, the board has decided to decline the 4G licence in its current form.”

Orange Egypt said: “Considering the existing terms and conditions of the proposed 4G licence, Orange Egypt decided not to apply for it. In particular, the quantity of spectrum currently availed does not allow to launch a 4G service with the required level of quality according to all international standards.”

It added: “Orange Egypt considers that the quantity of spectrum offered is not enough to offer the Egyptian customers the quality of 4G services that they deserve. We will remain available to discuss the 4G licence further in case a new framework is offered.”