Telecommunications

Until 2002 the Bahraini telecommunications sector was dominated by the monopoly player Bahrain Telecommunications Co., which provided all the kingdom’s telecommunications services. Service options were limited and often overpriced compared to prices elsewhere in the world.

Newly liberalized telecom sector presents outstanding opportunities

As part of the government’s efforts to privatize sections of the economy and attract technology and foreign investment into the kingdom, the Telecommunications Law was implemented and set a timetable for the liberalization of this sector. The liberalization of the telecommunications sector was envisioned to support the liberalization of other sectors and to provide an improved range of services at more competitive prices.

As Abdulla Hassan Saif, former Minister of Finance and National Economy, explains, “We must see results in developing a services sector, and the development of telecommunications will be an important part of this and help attract foreign investment.” The establishment of a regulatory body, the Telecommunications Regulatory Authority, which is both independent and has sufficient power to act, is a crucial step in the liberalization of the market. The establishment of the TRA was soon followed by the announcement of a proposed second mobile service in January 2003. In December 2003 MTC Vodafone became the kingdom’s second mobile phone operator and a new era of competition began.

MTC Vodafone Bahrain

Dr. Saad Hamad Al Barak, CEO

MTC-Vodafone, part of the MTC Group, which has operations in five countries, is Bahrain’s first telecommunications company to acquire an operating license following the Kingdom’s decision to liberalize its telecommunications sector and open it up to competition. MTC plans to serve five million customers in the region by end of 2005, 10 million by 2008 and 15 million by 2011.

Ever since it came out ahead of nine other leading conglomerates in January 2003, MTC has been aggressively moving forward in a market long dominated by a single entity. So successful was MTC’s launch that it began operations ahead of schedule in December 2003. As CEO Dr. Saad Hamad Al Barak explains, “We had set an ambitious target and no one thought we could make it. Still we beat everyone’s expectations and began operations before the target date.”

During its first year, MTC Vodafone built up a loyal customer base and firmly established the MTC Vodafone brand in the country. MTC Vodafone (Bahrain) has now positioned itself as the provider of choice in Bahrain thanks to its state-of-the-art 3G/EDGE/GPRS and GSM technology-based network, excellent customer support, a wide retail chain of MTC Vodafone (Bahrain) Experience Shops across the Kingdom and an innovative suite of products and services.

As Al Barak points out, “Bahrain needed something new. We are not a utilities company; we are an entertainment company. This industry is working with old ideas of the past that do not work anymore, we are changing the industry and providing the market with something they haven’t had before.”

Through the execution of new operational, marketing and customer service strategies, MTC Vodafone has rapidly grown to become the leading provider of mobile communications in Bahrain, signing on more than 100,000 customers in its first year of operations. As for the future, Al Barak promises “more of the same results and more than that. We will continue to provide extensive network coverage, innovative value-added services and make our services more widely available to customers in the Kingdom.”

MTC Vodafone is an example of a company that has benefited greatly from its location in Bahrain. As Al Barak explains, “Bahrain is an excellent place to do business. We find the infrastructure very well developed and regulated, there is an abundant educated workforce and Bahrain acts as a key market to the rest of the GCC. We grow with Bahrain and because of Bahrain.”

With a Bahrainization rate of 82% and a significant contribution to the economy, MTC-Vodafone is an active player in the community. To potential US investors interested in the region, Al Barak says, “It is time for the United States and the Arab world to open their eyes and look at things in a new way. There is too much misunderstanding and it is time to start a new cycle between the Arab World and America. We can all benefit if we have more understanding between our worlds. There is no better time to be in the Middle East and no place better than Bahrain.”