Etisalat joins race for third mobile licence in Oman

Muscat: Etisalat Group on Wednesday announced it has submitted a bid for the mobile licence in the Sultanate.
This follows similar move by Kuwait’s Zen group and Saudi Telecom Co (STC), which have both applied to become the third mobile operator in Oman.
“The bid is in line with Etisalat Group’s expansion strategy considering the market potential and similarities, footprint proximity to its core market, and likely synergies,” said a press release.
The qualified bidders will be announced on August 14, 2017 by Telecommunications Regulatory Authority (TRA), while the winner will be named on September 4.
The regional telecom service providers believe that the Oman market still has room for growth in the mobile segment. The Sultanate, which has a population of about 4.80 million by end-March, had a mobile penetration rate of 151 per cent with 6.87 million users in the fourth quarter of 2016, the regulator says. The vast majority of users were pre-pay customers.
Although the telecom service providers have shown robust growth in both sales revenue and net earnings, the recent increase in royalty and corporate income tax may hit the net earnings, according to a market analyst, who does not want to be named.
Zain on the Kuwait bourse announced on Tuesday that it had submitted an offer to bid for the licence. Rival STC had confirmed its application a day earlier, according to a Reuters report.
The Telecommunications Regulatory Authority (TRA) said last year that it was inviting bids for what will be the first mobile network operator licence, after Oman has awarded a licence toOoredoo Oman, which started operations in the country in 2004.
Oman Telecommunications (Omantel) and Ooredoo Oman each have a market share of about 41 per cent, with virtual mobile network operators holding about 17 per cent.
The sector is expected to be worth more than $700 million in Oman next year, up from $590 million in 2015, research company IDC says.
"Despite the economic woes and oil price fluctuation, the Omani telecoms market has witnessed relatively healthy growth," said Dubai-based IDC lead analyst Paul Black.
Zain operates in eight countries in the Middle East and Africa, while Saudi Arabia-based STC has subsidiaries and joint ventures in the Middle East and Asia.
Omantel, which has operated in the country since 1970, and Ooredoo Oman both reported declining first-quarter profit, citing higher royalty and tax rates.