Etisalat has submitted more information to the Telecommunications Regulatory Authority (TRA) in response to a request for details of its internal cost structure, the company said on Thursday. Etisalat said it had completed the pricing study as an "obligation under the current regulatory framework" for the regulator to approve certain price changes and promotions, a move that analysts say will lead to lower mobile rates in the UAE.
"As the dominant player in the market, when Etisalat makes a request to change the price of a certain product it has much more impact on the market than a new entrant could have," said Simon Simonian, the telecommunications analyst with Shuaa Capital. In April, Etisalat complied with the TRA's request to provide detailed information on its cost structure, a task that the federal regulator criticised the company for taking three years to complete.
But after that report was submitted, the TRA requested further information on its pricing structure, an Etisalat spokesman said. "Now that Etisalat has submitted its cost-evaluation model, as per the TRA's requirements, Etisalat expects to be able to implement significant and widespread changes in its calling tariffs and bring greater choice to customers in the UAE," the company said. Representatives from the TRA did not return calls for comment.
The cost-evaluation model is used as a guide when the TRA is asked to approve new pricing and promotional offers. To prevent a price war between Etisalat and du, telecoms operators are not allowed to provide services below their cost price. One possible outcome if the TRA were to approve Etisalat's price request would be an update to the company's iPhone pricing plans. Etisalat has not yet disclosed its mobile data prices for the new iPhone 3GS model that was launched last Tuesday, causing many of its subscribers to voice concerns online that the situation has made it difficult to buy the device.
The iPhone pricing plans from du have been publicly available for the past week. Mr Simonian said the TRA's approval of Etisalat's cost structure, would be beneficial for local consumers. "It would give more flexibility and ability for Etisalat to introduce certain promotions that in the past the TRA could have delayed," he said. At the ITU World Congress in Geneva this month, Mohammed Omran, the chairman of Etisalat, called for a review of telecommunications legislation, particularly those relating to pricing, to help stimulate growth in rapidly changing markets.