Men use mobile devices in front of the Dubai International Finance Centre (file). Currently du offers broadband and fixed-line services in certain parts of the country, while Etisalat has a far wider reach. The TRA is pushing for better terms of interconnectivity between the two operators in terms of fixed and mobile calls, as well as bitstream access for broadband services.
Zawya Dow Jones/Dubai
The telecom regulator in the UAE is set to implement new regulations allowing the two local operators access to each other’s network infrastructure, a move that will likely boost competition and lower retail prices in the Gulf state, according to a draft determination seen by Zawya Dow Jones.
The Telecommunications Regulatory Authority (TRA) has sent the determination to Abu Dhabi-based Emirates Telecommunications Corp (Etisalat) and Dubai’s Emirates Integrated Telecommunications Co (du) for feedback after months of discussions and consultations involving both the companies.
The regulator expects to have the document approved by its board before the end of the year, according to a person familiar with the matter, who declined to be named. It will however implement the “new remedies” - offering consumers across the UAE a choice on broadband and phone services - only after consultation with the stakeholders, according to the determination.
Etisalat was not immediately available for comment, while a du spokesperson declined to comment.
Currently du offers broadband and fixed-line services in certain parts of the country, while Etisalat has a far wider reach. The TRA draft determination pushes for better terms of interconnectivity between the two operators in terms of fixed and mobile calls, as well as bitstream access for broadband services.
“Most of the fixed infrastructure belongs to Etisalat that’s beyond discussion so du is going to get access to a much larger network,” said Petr Molik, chief financial officer at MenaCorp Finance in Abu Dhabi. “But Etisalat won’t be too disappointed because some of the lucrative new developments in Dubai were given exclusively to du.”
The TRA’s draft determination is part of an initiative to boost “sustainable” competition in the country. It first published a consultation late last year outlining areas of the telecom market where Etisalat and du possessed a dominant “market power” that could be used to each telco’s advantage. The consultation elicited a strong response from Etisalat as the telco sought to maintain its dominant market position, labelling the analysis “considerably insufficient” and asking the regulator to return to the drawing board.
But the TRA has been adamant in its push for greater market competition, and in a request-for-proposal document issued in April asked consultants to pitch for work to carry out a study that would estimate the value of economic activity generated by the sector, and the impact of lower prices on the overall economy.
“The vast majority of consumers in the UAE do not currently have a choice between fixed network service providers,” the TRA said in a response document to feedback from the telcos on the consultation. “The TRA therefore considers it is important to impose access remedies in order to ensure that competition can take place at the retail level,” the regulator said.