UAE telecoms regulator paves way for price battle between Etisalat and du

The telecoms regulator has enabled a significant increase in competition in mobile services in the UAE by waiving its approval for operators to set prepaid packages and tariffs.

Du said the TRA’s decision would allow faster introduction of prepaid mobile packages. Jeffrey Biteng / The National

The Telecommunications Regulatory Authority has enabled a significant increase in competition in UAE mobile services by waiving its approval for operators to set prepaid packages and tariffs.

The move is expected to boost competition between Etisalat and du and lead to greater pricing flexibility. Indeed, both companies are now free to introduce tariffs at short notice and change price offerings in response to each other.

“This move will expedite the process of new products entering the UAE’s ICT [information and communications technology] market and also improve the quality of services provided by Etisalat and du to consumers, within the current competition regulatory framework,” the TRA said yesterday.

Mohamed Nasser Al Ghanim, the TRA’s director general, said it would continue to monitor all telecoms products and packages released to the market to ensure that they comply with regulations, and would intervene if the rules were breached.

Du has welcomed the TRA’s decision, saying it would allow faster introduction of prepaid mobile packages and help it to respond quickly to market demands and trends.

Etisalat did not respond to requests for comment.

Prepaid mobile subscriptions account for about 87 per cent of all mobile subscriptions in the UAE, according to TRA figures from July.

There were 14.9 million active mobile subscriptions in the country at the end of July, according to the TRA.

The regulator said its move was in line with the current competition regulatory framework.

Etisalat and du currently enjoy respective market shares of 52.6 per cent and 47.4 per cent.

The TRA did not say whether it planned to extend the move to postpaid mobile subscriptions, which typically generate significantly more revenue than prepaid subscriptions.

Prepaid users made up 91.1 per cent of du’s mobile subscription base at the end of June, according to the company. However, prepaid revenue accounted for just 53.5 per cent during the second quarter.

As for Etisalat, prepaid users comprised 85.1 per cent of its mobile subscription base at the end of June , according to its financial results. It did not publish a breakdown of postpaid and prepaid revenue for the period.

On Monday, the regulator said mobile number portability, which allows mobile users to change telecoms providers while keeping their existing phone number, would be introduced by the end of the year.

The process will be “recipient-led”, meaning that the transfer will be handled solely by the new provider. This simplifies the process for customers, removing the need to have to contact their previous provider to obtain a porting authorisation code.