PCCW partnership wins fixed license in Oman

Oman has awarded a fixed-line telecoms license to a partnership between PCCW International and Awaser Oman Co, according to a statement filed by the country’s regulatory body.

The license covers the greater Muscat area – home to about 700,000 of Oman’s 2.8 million people – and is valid for a period of 25 years.

PCCW International (Hong Kong) and Awaser Oman Co (Muscat, Oman) will be able to provide both fixed-line voice and data services.

Oman already has two fixed-line operators in Omantel (Muscat, Oman), the state-controlled former monopoly, and Nawras (Muscat, Oman), owned by Qatar Telecom (Doha, Qatar), but the sector looks far less dynamic than the country’s mobile-phone market.

Omantel still claims a 96.4% share of overall fixed-line customers and an 83.9% share of total fixed-line revenues.

Last quarter, the company’s fixed-line retail business generated just 22% of the company’s 108.4 million rials ($282 million) in total revenues. Fixed-line revenues were also 14% lower than in the same period of 2011.

While Oman had about 3 million mobile-phone subscribers last quarter, just 300,000 fixed lines were reported in service by the country’s regulatory authority.

What’s more, average revenue per user (ARPU) at Omantel has declined steadily from about 15.2 rials a month in 2008 to 10.6 rials last quarter.

The biggest opportunity for PCCW International and Awaser Oman Co may lie in the country’s fixed-line broadband market.

Fixed broadband ARPU reported by Omantel has soared from 17 rials a month in 2008 to 38.8 rials last quarter, although the operator serves only 65,000 customers, up from just 49,000 a year earlier.

Indeed, mobile broadband has been the preferred option for both operators and consumers, with Omantel claiming about 473,000 customers last quarter, compared with 284,000 in the third quarter of 2011.

PCCW International and Awaser Oman Co may need to spend heavily on deploying new fixed-line broadband infrastructure unless they can gain access to Omantel’s systems on reasonable terms.

The poor showing by Nawras – which, as a subsidiary of cash-rich Qatar Telecom, is not short of funding options – suggests that cracking Oman’s fixed-line market will not be an easy task for the new licensee.

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