CAIRO: National Telecommunication Regulatory Authority (NTRA) Chairman Amr Badawy said Sunday the authority is considering suing the country s largest mobile operator Mobinil if the company resumes offering Enhanced Data for GSM Evolution (Edge) technology without acquiring a 3rd Generation license.
Badawy s comments came in response to Mobinil s announcement late last week of its intention to seek international arbitration to resolve the dispute with NTRA. Mobinil started offering Edge technology in May2006, but suspended the service in September, at the request of the Ministry of Telecommunication and Information Technology (MCIT), until an agreement is reached with NTRA.
Ordinarily, Edge allows for data transfer speeds up to 236 kilobits per second, almost four times higher than existing GSM and GPRS services, but well below the International Telecommunications Union (ITU) cutoff line for 3G. Theoretically, though, service providers can enhance Edge to reach more than 470 kilobits per second, one of the reasons why the international regulatory body classifies the technology as 3G. ITU s range for 3G services reaches up to 2 megabits per second.
Still, Mobinil Chairman Alex Shalaby argues none of the companies offering Edge in 88 countries have had to acquire special licensing because the speeds offered seldom reach the theoretical maximum of the service. The GSM Association, another international telecommunications regulatory body, classifies Edge as a 2.75G, a factor Mobinil has been relying heavily on in its case.
Badawy says NTRA will not recognize an international verdict in the dispute because Egyptian law supersedes. According to Law 10 of 2003, he said, all new services to be offered in the telecommunicationsector must be licensed and authorized in advance by NTRA, he adds.
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.
EFG Hermes Senior Analyst Wael Ziada says the company has a case but NTRA must also protect the interests of the Etisalat, which acquired the third mobile license in July for LE 16.7 billion, including the 3Glicense.
Edge is not a 3G technology, it s a 2.75G technology, says Ziada. No where else in the world does an operator offering Edge has 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.
Badawy says he recognizes the fact 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.
In late January, Vodafone Egypt acquired its 3G license for LE 3.34 billion plus 2.4 percent of annual revenues. Company officials have said they will begin offering 3G services within days after Etisalat is expected to begin operations in late March.
According to NTRA, mobile subscribers reached 17.8 million at the end of 2006, representing a penetration of nearly 25 percent. MCIT projects the number will reach 40 percent by 2010.