MVNOs on their way to ME, predict analysts

Jordan, Oman likely to be first to go the MVNO route, according to Delta Partners.

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By  Michele Howe Published  August 11, 2007

Jordan and Oman look set to be the first countries in the Middle East to open up to Mobile Virtual Network Operators (MVNOs), according to Delta Partners.

Although widespread in almost all European markets as well as existing in the US and parts of the Far East, MVNOs - telecom players that use other operators' infrastructure to offer mobile phone services - have yet to arrive in the Middle East.

But this is soon set to change, believes Delta Partners analyst Rogier van Driessche.

"The concept doesn't exist in the Middle East and nobody really wants to be the first because obviously there is some risk attached so markets are a bit looking at one another [but] as soon as there is one market that introduces the concept and has some success, I think you'll see a domino effect," he told ITP.net.

"Jordan is probably the market with the regulator that is the most explicit [in its intent to introduce MVNOs] and has published a plan of how they want to go forward, Oman in a less formal way is doing something similar and Bahrain is also looking at this. The expectation is that pretty soon the rest of the markets will follow," he added.

In June, Jordan's Telecommunications Regulatory Commission issued a draft regulatory decision paper on the provision of MVNO services making it the first country in the Middle East to take a formal step towards the MVNO route.

The value of the MVNO market in the region is potentially huge, van Driessche believes, predicting that the opportunity could be worth close to US$5 billion in the Middle East alone.

Saudi Arabia could be another potential candidate to introduce MVNOs in the near future, while the UAE and Kuwait look less likely to explore the option, Delta Partners notes in its new whitepaper on the topic.

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