Glitches delay Etisalat and du link-up

The introduction of broadband internet sharing between Etisalat and du as well as mobile number portability has been pushed back until next year.

The introduction of broadband internet sharing between Etisalat and du and mobile number portability has been delayed until next year.

Technical hitches have delayed the rollout of telecommunications services intended to spur competition in the market, says the UAE's chief telecoms regulator.

The introduction of broadband internet sharing between Etisalat and du as well as mobile number portability (MNP) has been pushed back until next year as the companies work out technical concerns, said Mohamed al Ghanim, the director general of the Telecommunications Regulatory Authority (TRA).

"We have delayed the launch because we want to make sure that the process is right for the customer and there is full automation that would happen with the two operators," said Mr al Ghanim.

MNP allows customers to change operators while keeping their phone number - something they cannot do at present. The service is available in Saudi Arabia and is set to be rolled out next year in Bahrain and Qatar.

Broadband sharing is a similar programme intended to allow subscribers to choose their internet provider.

Etisalat has a monopoly on traditional telephones, internet service and cable TV throughout most of the country. While du's mobile service spreads nationwide, its TV and internet services reach only a small area of Dubai including Dubai Marina and Media City.

Mr al Ghanim said the main issue with the delay in broadband sharing was applying the "bitstream" technology to link up the two fixed-line networks.

Bitstream is installed on software and hardware packages to identify occasions when a subscriber of one operator is using the telecoms service provided by the other.

"Infrastructure sharing is ultra-complex," said Mr al Ghanim. "What we're doing is bitstream with the fibre, which is happening for the first time around the world. There's a lot of technical and process issues that have to be resolved. When a customer migrates to [another operator] it should be a seamless and very easy process."

Mr al Ghanim said a trial process with selected customers would start early next year. Once that is completed, the service would be given the green light for the rest of the country.

MNP is being delayed for similar reasons, said Mr al Ghanim. While the service's platform is ready, processing issues have delayed its introduction.

"As soon as we make sure the process works, it will come out. But the system is ready," he said.

Irfan Ellam, a telecoms analyst at Al Mal Capital, said the introduction of the new services would be likely to chiefly benefit du.

However, both operators would be able to bundle their offerings into a "quadplay" package, in which customers could subscribe to television, fixed-line, internet and mobile services for a discounted rate, said Mr Ellam.

"Typically, your post-paid subscribers have a higher [average revenue per user] than prepaid. Since a majority of post-paid subscribers are with Etisalat, if MNP was brought in, it would be benefit du, as some post-paid subscribers may choose to move to du," he said.

"If you step away from this and look at it, you see this in most markets. If you have substantial market share and strong competition arrives, it is only natural to concede market share to the new player."

But Etisalat may use the opportunity to shift its attention away from its domestic market towards generating the majority of its revenues from international operations.

It already makes about 20 per cent of its earnings from its foreign subsidiaries and is in the due diligence stage of its planned purchase of 51 per cent of Zain for US$11bn (Dh40.4bn).

"If the Zain transaction goes through, Etisalat will be transformed. They've always maintained that they will get more of their revenue from overseas," said Mr Ellam.

A du spokesman said the operator welcomed the introduction of MNP and believed it would give consumers and businesses greater choice.

Etisalat declined to comment.