UPDATE: After a chat with Virgin's PR people, I've made some changes / additions.
Despite a cozy government-owned duopoly that seems ripe for more competition, the UAE telecommunications regulator has made it pretty clear not to expect a third mobile company here anytime soon.
One way around this licensing barrier is to
[ set up a virtual mobile network ]
, which basically piggybacks on the infrastructure of an existing mobile network but gives it a shiny new front end.
In most countries this also requires a license - although in Gulf markets, where the big incumbent former monopoly is effectively still a government department, my guess is that if Saudi Telecom, Etisalat etc decide to do a virtual network deal, the regulator will quickly and conveniently decide that it is well within their rights to do so.
That is close to what has just happened in Qatar, where
[ Richard Branson's Virgin Mobile today launched a virtual mobile network "brand partnership" with the incumbent Qatar Telecom ]
*. Virgin never got a mobile license (at least publicly) to operate there, and there was zero knowledge of this deal happening prior to launch. Compare that to Vodafone Qatar, a traditional network, which took years to establish.
brand partnership, Virgin Mobile can decide its own branding and marketing, set its own pricing plans and deals, and target its niche (the young, funky crowd, in this case). Obviously it will be charged for accessing the Qtel network, so the prices won't be too different to what is already on offer.
My guess is that when a third operator arrives in the UAE, it will be in the form of an Etisalat-affiliated virtual network. You won't see months of announcements from the regulator putting a new license on the table, a bidding process etc. One day, there will be a press conference, and it will announce a new partnership, and voila, third operator, minus any of the drama, or genuine competitive pressure.
UPDATE: The people from Virgin got in touch and wanted to make clear that this is not an virtual network, but a brand partnership. In my opinion, it has the key characteristics of an virtual network: using someone else's infrastructure with your own brand, customer service and pricing/marketing strategy. But I bow to Virgin Mobile's better understanding of its own business and what it should be called, and I hereby call this a brand partnership. They also wanted to make clear that this is competitive pricing - and when you compare the prices to those on offer from Qtel, it is indeed a good deal.