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No spectrum in sight for Palestine’s 2nd telco

Financial dispute looms as Wataniya Palestine’s spectrum deadline approaches

No spectrum in sight for Palestine’s 2nd telco
A lack of mobile frequency continues to hamper the development of the mobile sector in Palestine.

Palestine’s second mobile operator looks unlikely to make its October 15th launch date, as the network continues to wait for Israel-held frequency to be released to the Palestinian telecom regulator.

Wataniya Palestine set the regulator a deadline of September 15th (tomorrow) for the handover of frequency that it says it needs to launch next month, but so far no handover has taken place.

If the mid-October launch does not take place it raises the prospect of the Qtel-backed network seeking “financial remedies” to reclaim the money it has invested in the project.

“We have built our network and have everything in place to launch on the 15th of October,” Wataniya Palestine CEO Allan Richardson told CommsMEA. “But my board has been very explicit and they have said we will not launch without 4.8 MHz of spectrum.

“If we don’t get the spectrum, we will not be launching and that will have consequences that will have to be dealt with,” he said.

At the Palestine Investment Conference in May 2008, the Government of Israel agreed to release 4.8 MHz to its Palestinian counterpart within eight months, but so far only 2.4MHz has been made available to Palestine’s telecom regulator.

In a statement released at the end of August, Wataniya Palestine warned the Palestinian Ministry of Telecommunications and Information Technology (MTIT) it would “actively pursue financial remedies if the agreed minimum spectrum commitments are not kept within the planned launch schedule”.

So far Wataniya Palestine has paid the MTIT US$140 million for the mobile operators licence, and according to a May 2009 report by the Office of the Quartet Representative, the peace-seeking group spearheaded by Tony Blair, the network’s operating costs “exceed $4 million per month”.

“Our decision to proceed with the investment in 2008 was after receiving a written agreement between the Palestinians and the Israelis that we would have 4.8MHz by this time, and unfortunately we don’t,” Richardson said. “Until we have that resolved we will not be launching.”

The Israeli government has spoken to the Palestinian Authority about the potential release of 3.8MHz of spectrum, but Wataniya Palestine said this was less than the minimum required and less than the amount previously agreed.

With a 1MHz gap, Richardson said the network would not be able to support its potential subscribers and give them the services it believes are necessary to make its business plan work.

Despite the continuing struggle to secure frequency, Richardson said he remained optimistic that the network would eventually launch.

The lack of frequency scuppered Wataniya Palestine’s previous launch date of June, and the CEO of incumbent mobile operator and recent Zain acquisition Jawwal has warned that the network is in dire need of additional frequency

Israel’s Ministry of Communications did not respond to questions emailed by CommsMEA.

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