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Calling in cheaper rates

The UAE has just approved the license for its third telecoms operator, Yahsat. Will this lead to a greater variety of services and lower prices for consumers?

March 1, 2010 1:52 by

The telecom market in the UAE is growing rapidly; a recent report in The National cited that the country has the highest mobile penetration rate in the world, with an average of up to 2.4 mobile phone lines per person.

The two existing UAE operators, the incumbent Etisalat and later entrant du, have certainly been milking the local market. Late last month, du announced that its net profits reached AED528 million in 2009, as compared to AED8 million in 2008. It made revenues of AED5.3 billion in 2009, an increase of 35 percent from the previous year. The operator also said that its active mobile customers increased by 41 percent in 2009, and that it saw a 45 percent increase in fixed line subscribers during the year.

Osman Sultan, du’s CEO, said the operator has set aside $600 million to boost its network in 2010.

“Now we are a significant player in the telecoms market,” he said. “[In 2010] we will continue the growth in profits… we will continue the growth in revenues.”

Etisalat has also been ringing in the cash: The company announced last month that its net profits for 2009 increased by 16 percent compared to the previous year, to reach AED8.84 billion. The operator says it has kept aside cash reserves of about AED10 billion to launch a major overseas expansion drive in 2010.

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