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Oman Telecommunication Company - Case Study Example

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Oman Telecommunication Company

There is a 49%cap on foreign ownership in Omantel.However no single party can hold more that 5% of the company's shares currently.
The telecom landscape is primarily dominated by the state owned incumbent operator Oman Telecommunication Company (Omantel) It is the sole licensed operator of public fixed lines, telecommunication services including local, long distance and international telephony besides data communication and value added services, dominates the telecom landscape in Oman. It has launched its digital cellular network in 1996 and was the only mobile service provider in Oman until 2005, when new entrant Nawras telecom forayed into the market.Nawras won the tender for a second cellular license in June 2004 and received it in Feb 2005.Omantel's cellular subsidiary, Oman Mobile was given a the formal cellular license in Feb 2004.Both the players operate in the cellular market under a three year period of exclusivity that will expire next year. For the year ending Jan 2006,there were an estimated 1,78,000 internet users in the sultanate, out of which a vast majority accounted for Omantel's subscriptions.Howver since it's launch in March 2006,second mobile license holder Nawras has claimed 20% of the market share and has added over 3,00,000 new subscribers
In the current scenario, there is no schedule for awarding the third generation (3G) universal mobile telecommunication system (WMTS...
The Telecommunication Regulatory Authority(TRA)expects to license a second national public fixed line network operator as well as a second national public data operator in the near future but has not yet set a schedule for the endowment of the license.

Market Potential.
Statistics from the Telecommunication Regulatory Authority reveal the following:
Mobile phone subscriptions: 1.5 million
Fixed phone lines: 2, 69,000.
Out of this Omantel's subscriber base amounted to 1.242 million (all services) in June 2005.For mobile services its market share was a staggering 91.7% for the same period.
There has been a significant rise in the number of internet users, yet the penetration rates in Oman are low compared to other regions in GCC. Most of the internet users are concentrated in and around the capital region of Muscat. Despite persistent attempts, little progress has been made in other parts of the country, particularly in regard to the access of high-speed ADSL services. Therefore, it maybe inferred that there is a lot of untapped market potential in Oman. The Arab Advisors group forecasts that by the end of 2009 increased penetration figures, greater account usage and multiplier ratios might account for as many as 5,08,000 internet users in the sultanate. The installation and access charges are plunging, therefore the internet and data services market is promising.
In recent times, Nawras has introduced wireless EDGE broadband services. High-end business users constitute a major chunk of the clientele, but it is a small segment of the market and nearing saturation. In this context, the under twenty-five market segment is likely to drive growth. In markets like Europe and East Asia ...Show more


Oman Telecommunication Company (Omantel) has been the sultanate's principal telecom service provider for decades now. Formerly it was entirely state controlled but after Oman's accession to WTO in 2001, Government control has been slackened and finally the privatization is on the cards.
Author : acremin
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