Syria - Etisalat is a leading contender to become the third operator one of the few remaining growth opportunities

[the national] Etisalat is a leading contender to enter one of the last frontiers in the Middle Eastern mobile market as Syria’s telecommunications regulator prepares to issue a licence for a third operator.

The UAE’s largest telecoms company has been stating its desire to enter the Syrian market since last year.

“Etisalat is interested in the Syrian market and waiting to receive the bidding and conditions documents so it can fully study it,” said Ahmed bin Ali, the group senior vice president for corporate communications at the company.

While a list of potential bidders has not been revealed, Etisalat is the only major telecoms operator to express serious interest in launching a new operation in Syria. Kuwait’s Zain had earlier expressed interest in entering Syria but would rather purchase a mobile licence in Lebanon, where the operator already has a presence, according to Zawya Dow Jones.

Executives from both Batelco and Turkcell, two other regional operators who have stated a desire to expand their presence in the region, said they did not plan to bid.

Representatives from Qtel and Orascom could not be reached.

The Syrian telecoms market is highly regulated where the two existing operators, Syriatel and MTN Syria, are under strict build-operate-transfer (BOT) agreements that limit the amount of competition available in the market.

“Mobile prices are very high for the Syrian population,” said Faten Bader, an analyst with Arab Advisors Group.

“Syria is one of the few countries [in the region] that has a growing landline business because it’s very cheap compared to cellular prices.” More than 9.7 million Syrian mobile users pay an average of US$18 (Dh66.11) each per month for cellular access in a country where the average monthly salary is $242, said a survey by the Central Bureau of Statistics.

Only half the population owns a mobile device, presenting a unique opportunity for a third operator where penetration in the Middle East is more than one device per person. But Syrian consumers are expected to benefit from change in the telecoms market as the government is set to issue a new law that will create a regulatory body and lay down the framework to introduce “open competition within the next month”, said Malek al Jayoush, a partner who specialises in telecoms law at the Al Jayoush Law Firm in Damascus.

As part of the new legislation, the two existing operators in Syria will buy out their BOT agreements and convert to conventional licence agreements where they will pay an annual fee, Mr al Jayoush said.

“The forecast is for another five million customers to sign up in Syria in the next three years,” he said.

It will be a challenge for a third player to enter the market against two established operators but there is potential if they can invest heavily in providing reliable mobile networks because the existing quality is not good, Mr al Jayoush added.

Etisalat tries to get foot in the door in Syria