Regulator takes shape as second GSM licence sale goes ahead

31 January 2003
The Posts, Telegraphs & Telecommunications (PTT) Ministry is pressing ahead with plans to set up a regulatory authority prior to the award of a second GSM licence in the second half of the year. BNP Paribasis the adviser on the licence sale, which will for the first time introduce private competition into the local mobile phone sector (MEED 24:1:03).

'We have launched a comprehensive study with the International Telecommunications Union to establish an independent regulatory authority,' Ali Kermanshah, deputy minister for international affairs at the PTT Ministry, said at MEED's Middle East Telecoms conference, held in Bahrain on 21-22 January. 'The regulator will be entrusted with a range of tasks, including the issuing of licences to potential operators or the establishment of networks and facilities to provide telecoms services to the public as well as to institutions and private entities in competition with Telecommunications Company of Iran (TCI).'

However, the body will not be fully independent but will co-ordinate some of its policies with the PTT office once it is established. 'A deputy [PTT] minister has been appointed with the mandate of establishing the authority and we expect this to be completed in the next two months,' Kermanshah said.

The establishment of the operator will be followed by the award of at least one GSM licence. Under the mandate awarded to BNP Paribas, the French bank will prepare, promote and award any licence within eight months. 'The issue of the GSM licences to prospective operators will provide 5 million new customers within the next three years,' Kermanshah said. 'We expect to enter into negotiations in the next six months with interested operators for one or more licences.'

The initiatives are part of a wider plan announced by PTT Minister Ahmad Motamedi in 2001 to liberalise the telecoms sector and increase the number of cellular subscribers. Under the original programme, the expansion of the existing mobile network run by Telecommunications Company of Iran (TCI)and the second GSM licence were to boost user numbers to more than 10 million by 2004. However, the expansion plans for the cellular sector are lagging behind schedule and are now to be met by 2006.

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