x Abu Dhabi, UAESaturday 20 January 2018

Ironic twist as Dubai hosts telecoms talks

The International Telecommunication Union's so-called Dubai Treaty hopes to lay down guidelines for the industry over the next 20 years. Yet one of its key aims - to promote more affordable broadband access - is hardly reflected on the ground in the UAE.

Hamadoun Touré, the secretary-general of the the International Telecommunication Union, is hoping for more affordable broadband. Valentin Flauraud / Reuters
Hamadoun Touré, the secretary-general of the the International Telecommunication Union, is hoping for more affordable broadband. Valentin Flauraud / Reuters

Roaming agreements, broadband availability and infrastructure investment are among a wide range of matters to be addressed at the upcoming International Telecommunication Union (ITU) conference in Dubai.

Participants at the ITU's mammoth World Conference on International Telecommunications, which is to span 12 days in early December, intend to revise the International Telecommunication Regulations (ITRs), which date back to 1988.

Hamadoun Touré, the secretary-general of the ITU, says the conference will aim to set out principles for both telecoms operators and the union's member countries.

There is, however, a twinge of irony in the fact that these global telecoms guidelines are set to be rewritten in the UAE.

Speaking this week in Dubai, Mr Touré said excessive broadband fees were one of the main issues he is looking to address.

"The Dubai treaty, I hope, will last for the next 20 years," he said. "We hope that the ITRs will enable us to have an internet that is affordable to everyone. This is one of the key reasons that we are organising this conference."

Mr Touré, with exemplary diplomacy, avoided making any direct criticism of broadband fees here in the UAE. Yet the facts speak for themselves.

The consultancy Ovum said last year that the UAE was "one of the more expensive countries for broadband". It found that entry-level digital subscriber line subscriptions cost US$868 (Dh3,188) annually in the UAE - more than eight times the cost of a basic connection in countries such as Russia, India and Ukraine.

Mr Touré says affordability must be taken into account when it comes to broadband pricing. Russia, India and Ukraine all have much lower per capita GDP levels than the UAE, according to World Bank figures. But many countries with a higher per capita GDP than the Emirates, such as the United States, Switzerland and Belgium, all have cheaper broadband.

In the US, for example, AT&T offers a 12 megabits per second internet service for $29.95 a month. In the UAE, Etisalat has a slower 8 mbps package, which also includes a landline, for Dh299 a month.

One of the more extreme cases of costly broadband is the super-fast home service launched by du in August. The operator is charging Dh999 a month for the 100 mbps line - more than five times the cost of similar services in markets such as the United Kingdom.

The level of competition is a key factor behind broadband pricing.

There are currently two operators in the UAE. Du has proved an able challenger to the incumbent Etisalat after launching commercial services in 2007.

Yet further competition in the sector appears to have stalled.

For example, two initiatives that promised to boost the rivalry between the two players, and lower prices, have been repeatedly delayed.

The Telecommunications Regulatory Authority (TRA) originally said that mobile number portability, which allows users to switch operator without changing their number, was supposed to be available by mid-2008. That initiative would have compelled both Etisalat and du to work harder to retain customers, and pricing would have been a key element.

The introduction of fixed-line sharing, which would allow both operators to offer landline and broadband services nationwide, was first expected at the end of 2010, but has faced repeated delays. Currently, the operators are restricted to selling such services to certain areas, with du's offering limited to a few small, high-density areas of Dubai.

At first, technical issues were blamed for the two initiatives being delayed. Yet the longer they are postponed, the more it looks like the push behind them has subsided.

Mohamed Al Ghanim, the director general of the TRA, said this week that the two initiatives had not been abandoned, but declined to comment on the revised dates for their introduction.

Ownership of the UAE's two telecoms operators also has to be considered in relations to the competitive environment. Etisalat is 60 per cent owned by the federal Government, while du's shareholders include the federal Government, the Abu Dhabi Government and Dubai Holding.

Mr Touré said that in any market it was the "ultimate goal" for the private sector to take over the majority holding of telecoms companies. But he added: "you don't do it in a rush."