Etisalat: saturation point looms

(SAEED DAHLAH) Etisalat has been the telecommunications service provider in the UAE since 1976 and was one of the first companies to offer mobile phone services in the Middle East. The company is ranked 140th among the Financial Times Top 500 Corporations in the world in terms of market capitalisation, and is ranked by The Middle East magazine as the sixth-largest company in the region in terms of capitalisation and revenues. Apart from providing the UAE with basic telecommunications services, etisalat also offers a range of products that have positioned the country as one of the most advanced nations in telecoms. Mobile phone users enjoy voice and data applications like WAP, GPRS, 3G, MMS, Push-to-Talk and BlackBerry services. Enterprise customers have services such as Asynchronous Transfer Mode, Frame Relay, VSAT and ISDN. Mobile phone subscribers exceeded six million by the end of last year, representing a penetration of more than 150 per cent. Etisalat now faces competition for the first time from du, the UAE’s second telecoms operator. The company has been aggressive in its entry into other countries in the Middle East, North Africa and Southeast Asia. Excerpts from an interview with etisalat Chief Executive Mohamed Khalfan Al Qamzi: Mohamed Khalfan Al Qamzi, CEO Mohamed Khalfan Al Qamzi became Chief Executive of etisalat in April 2006. Since then, he has overseen the company’s rise to global prominence. He has also placed emphasis on the positive role etisalat can play in promoting the economic and social well-being of the UAE. He is a vocal advocate of the principles of social responsibility, and has actively supported educational and environmental initiatives. What do you have to say about recent complaints related to the efficiency of your network and its inability to accommodate new lines you have recently sold? It is not true that we have overloaded our network; it has a bigger capacity than several countries in Europe. And I believe you are talking about breakdowns and lack of coverage. This happened in the Global Village recently when it was difficult to make phone calls from there. It was because of a breakdown in transformers and has nothing to do with the network or its capacity. Also, in case of special events such as exhibitions or concerts, we send back-up vehicles with GSM systems to secure better coverage and boost capacity. We have deployed 47 such extra systems. Breakdowns happen due to various reasons, including power failures. What about network congestion during Eid holidays and on important occasions? During Eid the problem is often due to the inefficiency of the receiving party’s network. The proof is that internal phone calls do not face the same problems. You have obtained approval for new mobile prefix 056. What does this mean? It was natural to ask for a new code. Several countries have more than one code for mobile communications. The new code will help avoid increasing the number of digits in the 050 phone numbers to 10. The new prefix will make it easier for customers. This has nothing to do with the capacity of the current prefix. We will introduce 056 soon. What is the capacity of the new code? Some 10 million lines. Are you satisfied with the level of competition in the country’s telecommunications sector, given that both etisalat and du are simultaneously delivering special offers? Until now I have not seen any competition from the new operator, which is still in the establishment phase. It has not reached the position where it can be a rival. How has the new telecoms operator affected your growth? Growth has not been affected by the introduction of the new company. Rather etisalat has achieved higher growth rates than last year. This is what the figures have to say. Etisalat has managed to increase the number of subscribers. We have some one million new subscribers to our mobile phone services. The total number of subscribers is 6.3 million. This means the rate of penetration of mobile phones on etisalat’s network has reached 150 per cent, the highest in the world. We have 1.32 million fixed lines, while the users of internet services are more than two million, with a 60 per cent penetration, which is the highest in the Middle East. There are allegations that etisalat has become used to being a monopoly and has not taken care of its customers before the emergence of the new operator. It is not true. We have to be fair here. Maybe you remember when etisalat started its GSM service 12 years ago, the prices were high compared with now. We have voluntarily reduced the prices more than once and before the emergence of the new operator. Also, international calls now cost less. A call to the United Kingdom now costs less than Dh3 a minute from some Dh12 previously. We have won the consumers’ satisfaction because we offer quality services and keep our promises. There is no fairness in this accusation, especially with the pressures we are facin