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Send to a friendTelecoms Competition Comes to Qatar
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William Fagan
How was the process of awarding the second fixed license different from the mobile license?
The awarding of the mobile license ended in an auction process. The purpose behind the auction was to ensure transparency due to the huge level of interest evinced. In the original process we had 17 companies, then a technical evaluation was completed based on which we had a certain number through to the second stage, and finally we had the winner with the highest bid. The fixed license process was a 'beauty contest' which can be summed up best as a comparative evaluation. We asked the companies to submit proposals and evaluated them based upon a number of criteria such as technology, size and nature of the network they were going to build, viability of their business plans and their legal structure. Each area was evaluated by separate teams from within the Regulatory Authority with some outside consultants. The teams had to work in isolation and could not share views or information with other teams to ensure a fair process. A separate group aggregated the marks at a later stage. The entire progression was a streamlined one where we designed the process and asked the bidders to fill in the same templates for an even playing field.
When will the second fixed license be officially awarded?
The present situation is that it will take a couple of months to form the licensee company. The company will include Qatar Foundation, Vodafone and perhaps some other parties. The process is going to take some months to complete. We do expect to issue the license still before the end of the year. The license will indicate what the obligations are.
We understand that one important element of the fixed line process is the agreements with major property developers in Doha for optimum services. Can you tell us a little more about this?
The biggest cost for the fixed network is to actually dig open the ground and put in the fiber. Basically that's where 80% of the cost lies. That's why we're bringing some of the large property developers in since it's cheaper to put in the network when the ground is open. Our goal is to gravitate towards state-of-the-art infrastructure which should start taking us up to the kind of standards they have in countries like Japan, Korea and Singapore. The countries in the East have been phenomenal in the way they have developed broadband. Let's consider speeds of 100 megabits per second; that's the kind of bandwidth we must aim for, and you will never get that kind of speed/capacity unless you start planning for this. We are starting a study to look into providing high speed/capacity network connectivity for all, though it will take substantial investment and time.
How can Vodafone capitalize on the fixed-mobile convergence model?
Time will tell. This is the first country in the world where they have won both the fixed and mobile licenses; in other countries they have actually acquired fixed networks. I would expect to see an 'anytime, anyplace' communications offered by Vodafone and, indeed, Qtel as well. It doesn't matter whether you are on your laptop, your fixed phone in the office or you have a device in your hand, you can be contacted anywhere. You will also get additional functionality by offering WiMAX as well. So even if you are away, you can get your broadband on WiMAX or have the same service coming on your 3G handset. There will be a series of choices. Interoperability and interchangeability are far easier now, so convergence should enable operators to offer the same service to the customer at, hopefully, a competitive price no matter which platform is used for access.
Will Vodafone be sharing sites with Qtel initially until it builds its own infrastructure? Are there advantages and disadvantages here?
I can't really comment on that, but I understand there are discussions going on regarding this. From the regulator's perspective, the advantages to site-sharing are many because it should reduce the scale of investment required and decrease the time for service roll out. From an environmental perspective, there is much to benefit too.
With the introduction of the second mobile provider, what do you think will be the most critical factor for consumers to opt for one service over another?
Vodafone is doing some surveys already to get a feel on the consumer's pulse in what is a new market for the company and to know what people want. Also, one of the things about the market in Qatar is that it is clearly identifiable by segments. As examples of segments, we have the Qataris, the other Arabic speaking population, and then the various other expatriate groups. Qtel is already aiming at different segments of the Qatari market with customized offers. For example, the Filipinos might be habituated to messaging more, so Qtel has recently come up with an SMS-related offer for them. The consumer usage and demand patterns will really define the offerings. While value-for-money is still an important determinant, it is overall quality that will be the defining factor. In some market segments, the first is the quality, then it is pricing. Price sensitivity may be relegated to second place if people are happy with the quality of the service.
What are some steps that you think Qtel will take to ensure retention of consumers?
The quality of service is going to be critical. From a consumer perspective, there is nothing worse than having a phone service that doesn't work satisfactorily. We've started to work on Quality of Service (QOS) standards with Qtel, and we will be requiring Vodafone to do the same when they launch their service. Number portability may be an important element for consumers to make a choice. If Qtel wants to retain its consumers, the main area of focus will be through a good level of actual service and customer support. If they are competing on price they will have to ensure that the discounts they offer are not anti-competitive, and they are not selling services below cost particularly in markets where they are currently dominant.
Once the fixed line is in place and there is competition in the true sense for consumers, what are the consumer-driven initiatives that ictQATAR will help facilitate to ensure fair and healthy competition?
Making consumers aware of their legal rights is the most important thing. Our legal team is working on customer contracts and dispute resolution procedures. Another concept is to ensure that service providers don't just notify us of prices under the tariff control regime; they also have to provide a tariff document for customers giving an exhaustive overview of their terms and conditions and pricing packages. We are requiring Qtel, and in time, Vodafone to offer this type of information to customers in a transparent manner; it will also help the operators to strengthen their relationship with their customers. Our customer hotline is building up as well. Generally, we would expect the consumers to take their grievances to their service provider and we would intervene only if the service provider is unable to solve the problem. Customers in Qatar will adapt well to having a choice.
Can you give us a brief background of your career and how you came here to the Middle East?
I have worked in a number of areas related to the telecom industry during my career. I got involved in telecom first 25 years ago when there was a major national strike by the post office in Ireland that also took care of telecommunications, and there was a discrepancy in the telecom bills after the strike was settled. So we were setting up a new ombudsman's office there and one of the responsibilities I headed up was telephone billing complaints. I went on to become Head of Consumer Protection in Ireland where I worked for 8 years where among other things I dealt with telecoms billing and customer contracts. I have also held position as Chairman of various telecoms industry groups and regulatory committees. I got a call from a headhunter about this opportunity in the Middle East, and eventually joined ictQATAR. It's been a marvelous journey so far and I love working with the team here, and I love Doha as well.
What does the future hold for telecom?
Technology will continue to develop. There are two things happening ahead and the first is the 'anytime, anywhere' convenience so you don't have to be in a particular place to receive a particular service. The second is that whatever bandwidth size you want, be it for a simple voice call or live television on your device, you should be able to get it wherever you are. There will increasingly be more' pull' than 'push' as regards content. It's you, the consumer, who will choose the service content and quality you require. Going forward, people will pay for bandwidth rather than purchasing minutes of use, and the model is going to go further in that direction over time.
- By: Shalini Ravi
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