NTRA says company never obtained permission to offer technology
CAIRO: Mobinil has agreed to suspend using Enhanced Data for GSM Evolution (EDGE) technology until its dispute with the National Telecommunication Regulatory Authority (NTRA) is resolved, the Ministry of Communication and Information Technology (MCIT) announced yesterday. The announcement followed Tuesday s meeting between Mobinil Chairman Naguib Sawiris, Minister Tarek Kamel and NTRA Chairman Amr Badawy.
A source close to the meeting says the dispute between Mobinil and NTRA will likely head to court. Both sides seemed far from reaching a solution after Tuesday s meeting. Neither side was available for comment.
Mobinil s decision coincides with the end of the two-week grace period given by NTRA in late August to stop using the technology the authority classifies as Third-Generation (3G). Mobinil argues that the technology, which offers customers data-transfer speeds high enough to carry audio and video streaming, is classified as 2.75G and is recognized as such by the GSM Association, an international support body.
The company initiated wide promotion of its EDGE services such as Mobinil LIFE and Voice SMS through broadcast and print advertisements after successful trial runs earlier this year. Until the suspension decision, the services could have been found around the country, in major cities and airports, but not through the entire network.
In 2004, Mobinil had installed some of the equipment that uses EDGE technology on experimental basis, says an NTRA statement. The company had agreed not to use the equipment in commercial purposes unless upon approval from the NTRA.
In August, Sawiris vowed to take his case to court if necessary to avoid paying the LE 3.3 billion 3G license fee commanded by NTRA. EFG Hermes Senior Analyst Wael Ziada says the company has a case but NTRA must also protect the interests of the Etisalat, the recent acquirer of the third mobile license for LE 16.7 billion, including the 3G license.
Edge is not a 3G technology, it s a 2.75G technology, says Ziada. No where else in the world has an operator offering EDGE had to acquire a special license. But NTRA is looking at the case from a product standpoint, not a technology standpoint, which is what matters to the customer at the end.
Ziada says the dispute is a result of the overlapping of products and technologies since 2.75G and 3G technologies came to the market in a relatively short span of time.
HC Securities Analyst Hatem Alaa says the result of Tuesday s meeting means Mobinil is bound to suspend offering the technology until the dispute is resolved. The company had announced in August it had permission from the government to continue offering EDGE until its case was resolved with NTRA.
NTRA s Badawi says he recognizes the fact that no other operator has had to obtain a special license to offer EDGE but says each country s circumstances must be taken into consideration.
If there are other countries that have awarded 3G licenses for no charge, does that mean we re obligated to award a 3G license for free? he says.
Vodafone is expected to announce this month whether or not it intends to apply for a 3G license.
The Egyptian mobile market now serves more than 14 million customers, with Mobinil commanding about 7.2 million of them.
