Half of the network run by Kuwaiti operator Zain under a four-year management contract needs to be replaced, according to MTC-Touch, the name of the joint venture of Zain and the Lebanese government.

“I would say about 50 per cent of the present network needs to be gradually replaced,” says Mohammed Shabib, general manager of MTC-Touch. “A lot of the components are 10 years old or more and need to be ripped away if you wish to introduce new services.”

Both networks only use second generation (2G) mobile phone technology. Operators need 2.5G technology to offer high-margin data services to customers, and third generation technology if they want to provide mobile internet and video messaging services.

“I can’t give a number for the investment [needed],” he says. “You need to look at the whole network because the transmission, the base stations and some of the generators are really old and just need to be thrown away,” Shabib says.

Mobile phone calls in Lebanon are among the most expensive in the world because the Lebanese government has added a large levy, which has become one of the government’s few reliable sources of revenue.

Alfa, which runs the second network under an identical management contract, declined to say how much of its network needs to be replaced.