Virgin Among Five Bidders For Saudi Telecom Licences

The Kingdom plans to sell three mobile virtual network operator licences as part of a plan to liberalise its telecom market.

Five companies have submitted applications for virtual telecom licences in Saudi Arabia including Virgin Mobile Middle East & Africa (VMMEA).

VMMEA – part-owned by Richard Branson’s Virgin Group – is up against Dubai-based Axiom, plus consortiums headed by local companies FastNet and Safari and another that includes London-based Lebara, the Communication and Information Technology Commission (CITC) said on its website.

CITC will sell three mobile virtual network operator (MVNO) licences as part of a plan to liberalise the Kingdom’s telecom market, with Saudi poised to become only the second of the six Gulf Cooperation Council members after Oman to allow MVNOs.

The Kingdom has three mobile operators – Saudi Telecom Co (STC), Etihad Etisalat (Mobily) and Zain Saudi – and each are expected to host an MVNO.

MVNOs do not own the networks they use to provide communications services, but instead lease capacity from conventional operators.

VMMEA, which has operations in Jordan, South Africa and Oman, has signed a preliminary agreement with former monopoly STC to use its network, VMMEA chief executive Mikkel Vinter told Reuters in an emailed response to questions.

Bidders were required to include such an agreement in their application, Vinter said.

STC affiliate Cell C hosts VMMEA’s operations in South Africa, which was a factor in choosing STC this time, he said.

The other bidders have not stated with which operators they have made preliminary agreements.

Zain Saudi and Axiom declined to comment, while the regulator, STC, Mobily and the other bidders did not respond to requests for comment.

The CITC has told bidders that it will take up to 12 weeks to evaluate their tenders, Vinter said.