Taking on JT

Marwan Juma, Batelco Jordan’s energetic CEO explains how he intends leveraging technology to go around the incumbent, Jordan Telecom, rather than taking it on head-on.

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By  Tawanda Chihota Published  July 2, 2005

|~|Juma200.jpg|~|Juma says Batelco Jordan does not intend to reinvent the wheel when it comes to delivery of fixed services.|~|The Jordanian government’s decision in 2000 to liberalise its communications sector seems to have been the spark required to ignite the development of a group of young, able, entrepreneurial executives whose ambitions are limited only by the opportunities available. Michael Dagher is the man behind Jordan’s third GSM licensee, Umniah, which is preparing to lunch commercially at any point, while during the course of May, Batelco Jordan, led by spirited Marwan Juma, announced the formal issue of its ‘individual licence.’ Jordan’s ‘individual licence’ regime refers to the granting of access to scarce resources, which include radio frequencies and/or public rights of way and/or numbering in the provision of public telecoms services. Batelco Jordan, a company created through the merger of NETS - an online service provider and First Telecommunications Group - a data communications company, is the first provider in Jordan to apply for an ‘individual licence’ and was the first to be awarded one. The licence cost JDn 100,000 (US$141,000), and opens up the possibility for Batelco Jordan to launch fixed and international services, making it the de facto second fixed-line operator, breaking Jordan Telecom’s long monopoly of this sector. “So we are poised hopefully to become the second fixed telco in Jordan,” says Marwan Juma, Batelco Jordan chief executive. “But unlike the incumbent, we will not reinvent the wheel, we will not dig the ground for copper we will not offer fixed in the old way of offering fixed, we are looking at coming in as the new traffic provider leveraging technology as much as possible,” he adds. The battle with Jordan Telecom will be fought along technological lines, with Juma confident that his company can be more nimble and effective than the incumbent in providing the services demanded by the market. “Well the incumbent has size, the incumbent has legacy, the incumbent has coverage. We have to come in and be smart, we have to come in as nimble, as flexible and really have to leverage technologies, that’s really the only way to compete,” Juma explains. ||**|||~||~||~|Batelco Jordan expects initial service roll out before the end of the year and intends to build out its infrastructure incrementally, anticipating initial service launch by 4Q this year. Additional services are set to come to market in the first and second quarters of next year, though Juma remains coy on the exact nature of services to be deployed. “Of course with technology moving forward, and we see how convergence is happening at a more rapid pace now, and potentially triple play becoming a driver for people who will come in and acquire fixed services, we are not coming in and providing fixed services strictly for voice,” Juma proposes. “Anyone coming in with that business proposal would be dead even before they got started. We’re coming in and saying once you have digital access to your home or to your office there are much more things you can do, whether it’s voice, whether it’s video, whether it data or online games, or whether it conferencing, and we are now seeing interactive TV is slowly becoming a reality,” he adds. Fixed-mobile convergence is an area in which Juma sees much scope for leveraging efficiencies and it is no doubt an area Batelco Jordan intends to dabble in heavily in order to offer differentiated services. Juma describes the issue of mobilising services and applications as a tricky one at this point in time in Jordan because the licensing regime there as well as in many other places still tends to be based on licensing a technology. However, he believes that there is a definite shift towards unified licensing, where one’s licence is based on a service rather than technology. Batelco Jordan is in no doubt that fixed-wireless technology is moving towards full mobility. Fixed WiMAX, for example, will be certified by the end of this year and Juma believes what will follow is the development of mobile WiMAX, which could come in to compete with GSM . So the government has a role to play in terms of setting policy and then the regulator has to ensure that there is a level playing field, with operators being licensed against a service rather than a technology, Juma suggests. Jordan’s established mobile players have expressed concern that the level of competition in Jordan is arguably becoming greater than the market can support. “Jordan needs to be watched as far as going too far with liberalisation,” comments Marwan Alahmadi, MTC Group chief strategy officer. “It (Jordan) should not go the way of Austria, where too much liberalisation can destroy a market.” MTC Group owns a 96% stake in Jordanian market leader Fastlink, and the local operator has raised concerns regarding the launch of Umniah as the third GSM operator and fourth mobile player in a country with fewer than 6 million inhabitants. ||**|||~|Juma2001.jpg|~|Juma believes that unified licensing regimes are the way of the future.|~|“I believe the mobile market will be disturbed by the entry of Xpress and the third GSM operator,” says Mickael Ghossein, CEO of second-placed mobile operator MobileCom. “I do not believe the market can sustain four players,” he adds. While Fastlink chose to argue aggressively against the planned introduction of Umniah, Ghossein says that MobileCom has been knuckling down and focusing on its own preparedness instead. “The introduction of the third (GSM) operator was not necessary, especially when you have a small market of around five million inhabitants and an average GDP per capita of around US$1,700 per year. But when you’re an operator in a country you should accept the [government’s] strategy. Now, we should [adapt] our own strategy in a clever way to focus on the competition,” he adds. Batelco Jordan’s Juma is of a different opinion, believing it is the market that should decide the number of competitors in the market. “We have to let the market dictate. The government is not the one saying that there is not enough space, the market should dictate that. Now if people want to come in and invest and believe there’s a market case then so be it,” he suggests. Batelco Jordan is thus likely to face competitive threats of its own. The Telecommunications Regulatory Commission has not stipulated the number of ‘individual licences’ that will be awarded, and intends to assess applications as it receives them. “…I don’t anticipate many [new operators] coming in at the ‘individual licence’ level because no one really wants to compete against incumbents and no one really looks at fixed nowadays.... So besides that I expect, potentially another player coming in, maybe, and you’ll have a variety of entrants coming in as voice players…” Juma says. Juma quips that in many respects, Batelco’s operation in Jordan is the ‘anti-Batelco’ with respect to the parent operation in Bahrain, where the company is the incumbent operator in its domestic market, while it is taking on the roll of challenger in Jordan. “Of course we are leveraging Batelco’s experience in terms of the fixed experience and the voice experience, but when it comes to building a next generation network, when it comes to building an IP/MPLS core we are both doing it and we’re learning from each other,” Juma says. ||**||

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