Etisalat lashes out at doubters
Telecommunications giant Etisalat is promising to roll out its mobile services across 70% of Saudi Arabia is just six months.
Telecommunications giant Etisalat is promising to roll out its mobile services across 70% of Saudi Arabia is just six months. The company’s senior executive vice president Obaid Saeed Bin Mes’har told Gitex Times he was determined to fast track the project “to prove all our critics wrong.”
Just two months ago the company presided over a winning US$3.457 billion bid for Saudi Arabia’s second GSM license, prompting suggestions from many quarters that it has paid too much.
But a buoyant Bin Mes’har believes otherwise. “I am telling you we are going to make money on this deal. And I don’t accept the claims by some people that we are not experienced enough to do this work. Do you really think that Vodafone knows more about Saudi Arabia than we do? Or Telefonica? Or any of the other European countries that bid for the licence?” he asks.
“None of our competitors calculated correctly just how big the Saudi market is going to be. I challenge any mobile operator to do their sums properly and still try and tell me we can’t make money on this. They all know deep down that they have missed a great chance. Yes, it’s true that Etisalat paid more than anyone for this licence. But that simply means we will delay the time when we start making a profit on this by another quarter,” Bin Mes’har adds.
Etisalat’s winning bid was over US$200 million more than its nearest rivals. However, Bin Mes’har says: “Of course we paid a premium but that’s how you win a bid. I would have paid even more if I had to, because this is the most lucrative market in the Gulf.”
Etislat has already divided its licence into four geographical areas, and the project is well underway. The original aim was to establish coverage in 14 cities within the first year, but the target now is to have complete coverage in 30 separate cities by March next year.
“There are two reasons for this: the faster we do it, the faster we make money. But more importantly, I’m determined to show to the people that say we are too small, and that we can’t keep promises, that we are right about Saudi,” Bin Mes’har says.
Several key Etisalat staff have already been transferred from the UAE to the KSA, with the company assuring local player Saudi Telecom that it won’t poach any staff. Etisalat says it is also considering increasing its presence in the market, and a decision will be taken shortly.
Bin Mes’har says: “The current plan is for us to be in profit on this in five years, but that can be delayed if we feel we should expand more heavily there, in order to sustain our market position.”