Qatar calling

The acquisition of a mobile licence in Qatar will require some deft market positioning if it is to remain a viable business investment. With penetration rates in the Gulf state estimated to stand at 130%, in a market of some 840,000 inhabitants, the interest among leading regional and international telcos has intrigued market commentators.

"We were delighted by both the number and quality of the applications we received," commented ictQATAR's secretary general Hessa Al Jaber, on the back of the number of expressions of interest submitted for the second mobile licence on offer." The list includes important regional and international operators. This is a very good start to the process of bringing benefits to consumers through competition."

The first stage of the mobile application process closed in early September, with the ongoing second phase of the qualification process consisting of a technical evaluation followed by an auction among qualified candidates, with ictQATAR expecting to award the second mobile licence by the end of October 2007.

"Qatar has a rapidly growing economy and population with a high demand for all types of communications services," reports William Fagan ictQatar's executive director.

"Although mobile penetration is currently in excess of 100%, this has not been a disincentive for companies to invest in the market - 17 companies applied during the mobile licensing pre-qualification process." In order to redress the dominance of incumbent operator Qtel, ictQATAR has also issued a Dominance Designation Consultation Paper, with the consultation scheduled for completion by the beginning of October 2007.

Of the 12 remaining short-listed bidders for the licence eight are at partly or wholly- funded by companies outside the Middle East and Africa.

The pre-qualified candidates include: AT&T, ACE consortium (operator Airtel), Argos consortium (operator Verizon), Digicel, QUIC consortium (operators Omantel and Belgacom), Reliance Telecom and Vodafone.

Regional players entered into the final round of qualification include UAE-based Etisalat, MTC, Jordan Telecom and Orascom Telecom.

With such an uphill task facing any new market entrant, market commentators are asking how the potential new entrant will prove a point of difference in Qatar.

AT&T chairman and chief executive Randall Stephenson recently visited Qatar claiming the company would introduce "innovative products and services," and claiming the country posed "a very attractive market for a variety of telecoms products and services".

He said that in markets such as Qatar, it made sense to introduce competition in a balanced and structured way. "In the longer term, our experience shows that markets that have a diversity of competitors and healthy competition are the ones that bring the most innovation and choice for consumers and bring the widest benefits to the local economy," he said.

Geoffrey Webster, AT&T vice president for Global Ventures and Business Development, echoes these sentiments claiming the timing of the invitation could not be more fortuitous.

"We see Qatar as a very dynamic market that offers a valuable opportunity for growth. We are looking towards the Middle East as one of our key markets outside of our US base," he says.

"The opportunity to enter the wireless market in Qatar will give us an opportunity to harness the high levels of growth currently underway in the Middle East telecoms space," he adds.