MTG eyes stake in Oplayo

Mobile Telecom Group (MTG) is close to purchasing a stake in UK-based video streaming specialist, Oplayo, after forming a partnership with the company earlier this year.

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By  Richard Agnew Published  November 24, 2004

Mobile Telecom Group (MTG) is close to purchasing a stake in UK-based video streaming specialist, Oplayo, after forming a partnership with the company earlier this year. The Abu Dhabi-based mobile service provider’s financial advisors are in the closing stages of preparations for the acquisition. If it goes through, the move would see MTG join Nokia and Siemens as an investor in the rich media technology supplier. “Our financial consultants are going through due diligence to own a stake in Oplayo, to be on a par with its existing investors,” Ammar Sharaf, chief executive officer of MTG, tells CommsMEA. “This will be one of the biggest investments that we will make. The deal will give us access to new technology and markets. Oplayo’s system is experiencing impressive adoption and the firm is striking deals all the way from Mexico to China,” he adds. The move forms part of a push by MTG to expand and diversify its business, which now focuses on mobile service provision. After being founded in 2000 as the UAE’s first audio text service provider, the firm has since expanded its distribution channels to include IVR, SMS, WAP, GPRS, the internet, 3G and digital TV. It also recently created an investment division which, it says, has been allocated in excess of Dhs100 million (US$27 million) to pay for various acquisitions through 2005. Beyond the Oplayo deal, it claims to be preparing to invest in another un-named technology supplier, based in Asia. “We’re looking for strategic investments in telecoms technology that doesn’t necessarily have to be expensive but needs to be fairly advanced,” adds Sharaf. Part of the programme, the service provider says, will also focus on developing financial interests in GSM licences in the Middle East, particularly through a recently-struck strategic partnership with Kuwait-based regional mobile operator, MTC Group. Together, the two companies are already probing any opportunities that could be offered by the impending liberalisation of the UAE’s GSM sector. “The introduction of the investment division within MTG was not [solely] focused on equity investments, but also on investments that will position us strategically as a telecoms player,” says Sharaf. “We have a lot of respect for the role that MTC is playing on a regional level and they see us a strategic partner, especially in the UAE,” he adds. The deal with Oplayo will also cement a technology licensing partnership announced in February between the two firms. Through it, MTG is using Oplayo’s compression technology to stream rich content to mid and high end, Java-enabled mobile phones in the Middle East. The provider, for example, has already deployed the solution to offer content from Arabic music channel, Rotana TV, to MTC-Vodafone’s subscribers in Kuwait. Following user trials during the summer, MTG is also aiming to launch services with its other partners, which include Oman Mobile, Etisalat, Batelco, Qatar Telecom, Saudi Telecom and Investcom. “We soft launched video services on Oplayo this summer and are working with several operators in the region to introduce it on their GPRS and 3G networks,” says Sharaf. The move would also allow the provider to tap into global demand for Oplayo’s technology, which the supplier expects to be supported by over 500 million handsets by the end of this year. Originally set up as a spin-off from the Finnish government’s VTT Labs, Oplayo’s existing investors include Nokia Venture Partners, Zouk Ventures, Houltron Ventures and Aura Capital Oy. Siemens’ venture capital arm, Mobile Acceleration, also invested in Oplayo in February of this year during a funding round that saw the technology provider raising around US$5.7 million.

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