Bharti loses out to Kuwait’s MTC for Saudi cell licence

NEW DELHI: A consortium led by Kuwait’s Mobile Telecom (MTC) made the highest bid for Saudi Arabia’s third mobile licence, with an offer of SR22.91 billion ($6.11 billion) to enter the largest mobile market in the Middle East. Rival bidders for the third mobile operating licence in the kingdom, those by consortia, including Bharti and Reliance, emerged second and sixth, respectively.

Bidding the highest amount does not automatically guarantee issue of licence. Evaluation of bid documents, with the help of Arthur D Little, is still underway. The Communications and Information Technology Commission (CITC), the telecom regulator, said the determination of the winner required cabinet approval, according to the Gulf Research Centre.

Saudi Arabia is the Middle East’s fastest growing telecom market with total revenues from both mobile and land phones reaching SR34.2 billion ($9.1 billion) in 2005. Forecasts indicate that the number of mobile phone and internet subscribers will double in the next five years.

According to one study, total expenditure within the sector could reach SR225 billion ($60 billion) by the year 2020. At present there are 18 million mobile phones and four million fixed phones in the Kingdom. A consortium led by UAE’s Etisalat paid SR12.21 billion for the second GSM license in 2004. The announcement of the third mobile licences comes before awarding the second land phone licence.Verizon Communications, MTNL and China Telecom are competing for the land phone licence.