Bahrain opens up to ISPs

Bahrain’s Telecommunications Regulatory Authority (TRA) has continued its speedy liberalisation programme by officially making licences available for suppliers of value added services (VAS) and internet service providers (ISPs) in the Kingdom.

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By  Richard Agnew Published  August 31, 2003

|~||~||~|Bahrain’s Telecommunications Regulatory Authority (TRA) has continued its speedy liberalisation programme by officially making licences available for suppliers of value added services (VAS) and internet service providers (ISPs) in the Kingdom.
The move will see the TRA accepting applications from interested parties and granting class licences to all candidates that qualify, in accordance with Bahrain’s telecoms decree law no. 48, which came into effect in October last year.
“The TRA is pleased to make available licenses that will allow for the creation of a competitive and dynamic marketplace capable of bringing new and innovative world-class services to customers in Bahrain,” says Dr. Mohammed Alghatam, the authority’s chairman.
“In addition to the substantial consumer benefits that we expect will culminate in the months ahead, we also view the availability of these licenses as a significant entrepreneurial opportunity. Businesses and individuals in Bahrain [will be able to] capitalise on the economic benefits and prospects afforded by the introduction of competition into these two rapidly expanding areas of the telecoms sector,” Dr. Alghatam adds.
According to the regulator, applicants must be based in Bahrain and locate a substantial proportion of their infrastructure and business activity in the Kingdom, but may be foreign-owned.
Both sets of licences will be valid for 15 years, while the TRA says it will charge a nominal fee for them to cover administration costs. The authority has published guidance forms and application forms on its website.
The VAS licences will cover, but not be limited to providers of mobile data, pre-pay cards, location-based services, wireless internet, m-business, virtual networks, messaging and application service provision.
Qualifying ISPs will be able to offer international voice services but will require a separate, individual licence to do so. The TRA says that it has already awarded licences both categories and will start publishing the names of the companies that have qualified in early September.
The first ISPs and VAS providers should start operations “by the end of the year,” says Keith Gilbert, deputy director general of the TRA, adding that some companies have already started to make investments in Bahrain ahead of being awarded licences.
In early August, the TRA initiated a 56-day consultation on retail price controls, from which it will determine pricing, tariffs and revenue sharing models between the ISPs that qualify and Bahrain’s monopoly telecoms operator, Batelco. “The retail price regulations will go through in the near future,” says Gilbert.
Competition will also be extended to the retail market for broadband services. “There will be a requirement for wholesale DSL and the unbundling of the local loop will start during 2004,” Gilbert explains.
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Wireless hotspot and other fixed wireless internet access providers will also to be able to target Bahrain when licences are brought in next year. “Once that area is liberalised in 2004, we will be looking for innovative solutions for fixed access,” Gilbert says.
Bahrain’s cabinet also recently gave the green light for an internet exchange to be set up in the Kingdom to manage connections between the ISPs that gain licences and to aggregate international internet traffic.
The government will provide the necessary funding to support the venture for the first year, before a licence to operate it will be handed to a not-for-profit entity. The exchange will then be overseen by a board of directors and an executive director and be funded by contributions from ISPs on a pro rata basis.
“There’s a requirement that all ISPs connect to the exchange for traffic,” says Gilbert. “It is in the process of being physically set up, and will hopefully be available in the timeframe required by the ISPs,” he adds.
Additionally, international facilities licences will be opened up in the first quarter of next year, allowing global bandwidth providers to target Bahrain. “We’re trying to attract extra bandwidth into the Kingdom, be that satellite or fibre-based. Licences will be made available next year to achieve that,” says Gilbert.
On a wider scope, the opening of the ISP and VAS provider licences forms part of the TRA’s ongoing plan to open up the telecoms sector in Bahrain.
Kuwaiti mobile operator MTC-Vodafone won a tender to enter the Kingdom’s mobile market in April this year, beating off fellow finalists Wataniya Telecom and Kalaam.
Additionally, along with the international facilities licences, very small aperture terminal (VSAT), paging, public access mobile radio, national fixed and international services licences are scheduled to be issued in Bahrain during 2004.
Meanwhile, Intercai Mondiale, the international telecoms consultancy selected earlier this year to manage the TRA’s liberalisation programme on an interim basis, will fulfill that function until the end of the year.
“We are filling full-time positions to take over the role,” says Gilbert.
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