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Licence competition heats up in Riyadh

The nine international players vying to challenge incumbents Al Jawal and Mobily include Orascom Telecom, MTC, MTN, Oger Telecom and Singapore operator SingTel. Industry insiders speculate the tender process could land the Saudi government with a massive SR15 billion (US$4 billion).

The Saudi Communications and Information Technology Commission (CITC) has released official details of nine approved applications for the kingdom’s third GSM licence.

The nine international players vying to challenge incumbents Al Jawal and Mobily include Orascom Telecom, MTC, MTN, Oger Telecom and Singapore operator SingTel. Industry insiders speculate the tender process could land the Saudi government with a massive SR15 billion (US$4 billion).

The prospect of entering what many analysts consider the most lucrative mobile market in the Middle East has not just attracted the region’s heavy weights. Three Indian telcos also intend to submit bids. Bharti Airtel, Reliance Communications and Mahangar Telephone Nigam Limited (MTNL) will be looking to leverage off their experience of providing low cost telephony services in their home country in order to rival the incumbents. However, they are likely to face very stiff competition at the bidding stage, with industry giant Orascom intent on ensuring its second shot at entering the Saudi market is on target.

“The companies I see battling fiercely are MTC and Orascom. They have stated that they do not have any problem paying more than the amount paid for the second licence,” commented Marc Hammoud, vice president of research at Shuaa Capital in Dubai.

The deadline for submitting applications to take part in the bidding process ends on March 10 2007.

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