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Qtel Q2 2007 - Strengthening its Position As an International Competitor
Qatar's Qtel is the latest company from the Middle East to declare its intention of becoming a major power in the world telecommunications market. As its Managing Director Dr Nasser Marafih noted in the company's recent press release "Qtel's strategic priority is to continue to grow profitably and to fulfil its vision of becoming one of the top 20 world telecom operators by 2020; through a combination of partnerships and acquisitions".
Local rivals MTC Kuwait, Orascom and Etisalat have all stated similar goals, while the ambitions of MTN in the region are also considerable.
So does this make the aim unattainable? We think not. Certainly, the company has a long way to go if it is to succeed, but it has made some major strides in this direction in the last year. First, it acquired a stake in ST Telemedia, which took it into Indonesia and Singapore. Next, it bought a 51% stake in Wataniya, which gave it exposure to Algeria, Tunisia, Kuwait, Iraq, the Maldives and, in a limited way, Saudi Arabia. Most recently, it has bought 77.8% of ATCO Clearwire, a fixed wireless business operating in Jordan and Pakistan, while STT has added two new countries to its portfolio, by acquiring a 49% interest in Shenington Investments, a holding company that owns 49% of Lao Telecommunications Co in Laos and 100% of Cambodia Shinawatra.
In total, this portfolio spans 15 countries with a combined population of over 527m. That puts the business in the same sort of league as MTC or MTN, without of course, the same degree of control. In many ways, the approach Qtel is adopting is very similar to that used so successfully by AirTouch and Vodafone in Europe in the 90s. Control wasn't the first priority; what mattered was establishing a presence and a partnership which would provide a basis for future development.
The company's recent results focus on the consolidated subsidiaries. In Qatar, Qtel is still a monopoly operator and although penetration is now over 100%, growth is continuing apace. Revenues in the six months to June 07 were 16.9% up on those of the same period of 2006, thanks in large part to a 37% increase in the customer base. In Oman, Nawras enjoyed another strong quarter, increasing its base by 17.5% despite some appalling weather in the region that disrupted all forms of communication in the region. Year on year, Nawras has come very close to doubling its base, which is 99.7% up at 787k. Commendably, almost all of this strong improvement has dropped through to the revenue line, which is up 91%. Wataniya's customer base now stands at 7.4m overall, or 4.9m on a proportionate basis. This excludes the former customers of AsiaCell in Iraq, as the authorities have cancelled that licence. Apparently, AsiaCell has a chance to acquire a new licence later this month through an auction process.
Posted to the site on 16th August 2007
This article was extracted from The Mobile World Briefing, the weekly newsletter from The Mobile World.
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