Two more service providers have expressed interest in acquiring 4G mobile phone licenses offered by the Egyptian Government, says a Communications Ministry official.
China Telecom, the country’s third-largest carrier, and Saudi Telecom, the biggest telecom player in Saudi Arabia are the two entities who have come forward for the licenses. However, the companies are yet to make any official requests. Kuwait’s Zain has already made an official submission to the Government last week.
The increasing number of new players expressing interest in the 4G license will be a threat to country’s local players such as Vodafone Group Plc, Orange SA, and Emirates Telecommunications Corp. The Government has asked these carriers to accept the terms set by it at the first week of August. “The licenses will be offered to the new players only if the current operators reject the permits,” said the Ministry official who wished to remain unnamed.
According to the data by the Government, Egypt has 95 million mobile subscribers. Among the current operators, the 4G price for Orange is 3.54 billion Egyptian pounds ($399 million).
“For China Telecom, acquiring a 4G license in Egypt is more about establishing the presence in the country than to compete with other players,” Steven Liu, head of research at China Securities International said to Bloomberg.
Meanwhile, there are lesser chances for the local players to give way to new players, confirms the banking sources. To say, Telecom Egypt, the country’s state-owned landline monopoly, is in talks with banks for a 5 billion Egyptian pound ($563.07 million) loan to acquire 4G license. Etisalat Egypt was also in talks with banks for the purpose.
The sale of 4G licenses is part of a long-awaited plan to reform Egyptian telecoms. It will provide potentially allow Egypt’s landline monopoly, Telecom Egypt, to enter the mobile phone market directly. It will also allow mobile operators to offer fixed line services, ending Telecom Egypt’s dominance in the country. Telecom Egypt currently owns 45% of stake in Vodafone Egypt.