Exclusivity question on Etisalat iPhone deal

Etisalat's deal to distribute the Apple iPhone could be anti-competitive if it includes an exclusivity clause, Osman Sultan, the chief executive of du, said yesterday. Last week, Etisalat announced it had reached an agreement to bring the popular device to the UAE by the end of this month. The company did not say whether Apple had agreed not to make a similar agreement available to du, its rival company. Etisalat also did not reveal whether the device would come "locked" to its network.

"We have been talking to Apple since day one," Mr Sultan said. "We hope the agreement will not mean any type of exclusivity, which is what we are trying to figure out, because I believe that would be making use and abuse of a dominant position in the market." Etisalat will offer the iPhone as part of a subscription package that includes calling, text messaging and internet access over its network.

It is expected to be a major drawcard among affluent, high-spending customers, who form the most valuable segment of the market for both du and Etisalat. "If because of their natural weight in the market as an incumbent operator - as opposed to one that has only been in the market a couple of years - they can use this to lock customers, I strongly believe that this will not be a fair practice for competition," Mr Sultan said. 

Etisalat declined to comment. The Telecommunications Regulatory Authority (TRA) did not answer questions regarding the deal, but issued a statement saying that "the TRA promotes the adoption and presence of the latest technologies in telecom and IT in the UAE, and definitely promotes innovation, and we do not encourage exclusivity. The TRA policies are clear towards anti-competitive practices and the licensees are aware of that."

tgara@thenational.ae