JEDDAH, 26 May 2004 — The Communications and Information Technology Commission (CITC), the Kingdom’s telecom regulator, said it would publicly open the final bids of the 11 consortia vying for the Kingdom’s second mobile phone license to ensure transparency.
“The bids will be opened in the presence of the consortia’s representatives and journalists to ensure justice and transparency,” said Dr. Mohammed Al-Suwayel, the governor of the commission. After the review the commission will make a recommendation to the Council of Ministers, which has the final word.
International telecom giants including Vodafone of Britain, Deutsche Telekom of Germany and Telefonica of Spain were among the consortia prequalified to bid for the license.
“We’ll review the technical and commercial offers in light of the declared criteria. Every consortium given 85 points will be qualified for the second stage,” he said. CITC has fixed June 26 as the date to receive final offers.
“The international companies competing for the license have purchased application forms to make the final offers. They also had a lot of queries. This shows their interest in a promising market known for its stability and strategic position as well as economic and demographic growth,” Al-Suwayel said.
The commission has prequalified the following consortia: Etisalat Consortium, FAL Holdings Arabia (Deutsche Telekom), Integrated Visions (Maxis), Kingdom Telefonica (Telefonica Moviles), Mobilkom Saudi Arabia (Mobilkom Austria), MTC & Partners (MTC), MTN Saudi Arabia (MTN), Oger Telecom (Bouygues), Orascom Telecom Saudi Arabia (Orascom), Samawat (Telecom Italia Mobile) and Vodafone & Saudi Partners (Vodafone).
Referring to reports that Maxis has pulled out, the governor said the Malaysian company had not officially told CITC of its plans. “The company is not obligated to inform us, because submitting their final bid is at the discretion of the consortium. If any company fails to hand in their bid it means they have withdrawn,” he said. If Maxis pulls out, the Saudis in the consortium can join other consortia before the due date, he added.
Earlier in a statement, the commission indicated that it would announce the winner of the license by the last quarter of 2004. The license sale is expected to net the Saudi treasury at least $1 billion.
Revenue from mobile phone services in Saudi Arabia is expected to rise to nearly $8 billion in 2007.
Al-Suwayel said foreign investors could buy up to 49 percent of the new joint stock company to be set up to operate the new GSM. “The foreign investor can own a minimum stake of 15 percent and a maximum of 49 percent,” he said.
Saudi Arabia is the largest telecom market in the Gulf region with four million landlines and seven million mobiles. The sector is growing at the rate of 30 percent annually. More information on the licensing process can be had from CITC’s website www.citc.gov.sa