Following its ambitious expansion plans, the Qtel Group has rapidly transformed from operations in two countries to operations in 15 countries in just over six months. With its recent investment in Iraq’s mobile license the Qtel Group’s total subscriber base has increased to over 13 million. Through its subsidiary and associate companies, the Qtel Group covers a total population of 527 million.
Qtel has made no secret of its bold vision for the future of being among the top 20 telecommunications companies in the world by 2020. “We believe we have the right strategy in place to attain our goal and you will find Qtel rapidly moving forward - both in the regional and international market. Our focus will be expansion coupled with consolidation in order to obtain scale, establish synergies and attain operational excellence. We will seek to maximize the many investment opportunities in-hand, as well as develop our international growth strategy while continuing to provide high quality services and applications for our customers,” said Dr Nasser Marafih, Chief Executive Officer, Qtel.
“Our international growth strategy is based on three pillars: consumer wireless markets, fixed wireless, and Managed Data Services, the latter serving large and corporate businesses around the region,” said Dr Marafih. “Qtel is continually exploring growth opportunities. Currently our regional ambitions are focused on, but not limited to, Asia and the Middle East and North Africa. These are regions where we have key experience and relationships and can reinforce our existing investments.”
Consumer wireless markets
The Qtel Group made three major moves in 2007, placing Qtel in the premier league of mobile operators in the Middle East, North Africa (MENA) and Asia. The Qtel Group acquired a 25% shareholding in Asia Mobile Holdings (AMH) in January 2007, for mobile expansion opportunities in the Asia-Pacific region through its strategic alliance with ST Telemedia (STT). STT is a leading information-communications company with operations in Asia-Pacific, the Americas and Europe. AMH owns STT’s controlling shareholdings in two major operators in the region - PT Indosat in Indonesia, and Starhub in Singapore.
Through AMH, the Qtel Group has interests in Singapore (Mobile subscribers: 1.5 million), Cambodia (Mobile subscribers: 0.4 million), Laos (Mobile subscribers: 0.8 million) and Indonesia (Mobile subscribers: 20.2 million).
In March 2007, the Qtel Group acquired a 51% controlling interest in Wataniya. Wataniya is one of the leading MENA telecom operators with businesses in six countries in the region. Importantly, it gives the expanded Qtel Group a key foothold in the MENA region as well as significant growth opportunities in North Africa.
One of the more advanced network operators in the region, Wataniya has operations in Kuwait with over 1.1 million mobile subscribers, Tunisia (Mobile subscribers: 3.2 million), Algeria (Mobile subscribers: 3.0 million), Saudi Arabia (Push-to-talk: 0.1 million), Maldives (Mobile subscribers: 0.06 million), and Palestine.
Qtel is a substantial shareholder in the Asiacell consortium that recently won a 15-year license in Iraq (Mobile penetration: 37%) for $1.25 billion. Asiacell Communications LLC (ACL), which will be the operating company of the Asiacell consortium going forwards, has purchased all of the assets o of Asi ia Cell Cayman (“ACC”) from the liquidator in the Cayman Islands. ACL already has a total mobile subscriber base of 3.6 million. Qtel has an effective shareholding in ACL of just over 30%, through an investment company that Qtel controls. Qtel will be consolidating ACL’s results from now on.
Iraq, a country with 26 million people and the world’s third-largest oil reserves, currently has approximately nine million mobile users, representing a mobile penetration rate of approximately 37%. Asiacell, which began operating in the Kurdish North of Iraq in 1999, is a GSM pioneer in Iraq and has built Iraq’s largest network with over 1,000 sites. In addition, it has a staff of 3,700, many of whom trained in Asiacell’s advanced headquarters facility in Kurdistan. Iraq sold three mobile phone licences for $3.75 billion to Asiacell, Kuwait's Mobile Telecommunications Co (MTC) and Korek. The winners will also share 18% of their operations revenues with the Iraq government.
Qtel’s subsidiary Nawras in Oman (Mobile penetration: 74%), along with international and Omani partners, has a customer base of 787,000. Nawras was launched in March 2005 with an innovative, record-breaking implementation programme that introduced unprecedented levels of service, quality and value to the mobile market in the Sultanate.
Within two years of operation, Nawras emerged as a dynamic, fast moving and a very credible operator offering a vast range of Prepaid and Postpaid mobile services. Nawras represents a unique blend of technical expertise, local knowledge and long-term commitment; offerings that will help ensure that Nawras becomes Oman’s mobile operator of choice.
Fixed wireless
In May 2007, the Qtel Group partnered with ATCO (A.A. Turki Corporation for Trading and Contracting of Saudi Arabia) to buy a 75% shareholding in Pakistan-based Burraq Telecom. Following the investment of the Qtel/ ATCO joint venture, known as ATCO Clearwire Telecom Limited (ACTL), as well as further capital contributions, Burraq Telecom plans to deploy and operate broadband wireless/WiMAX networks within Pakistan.
ATCL’s investment in Burraq Telecom is part of ACTL’s strategy to develop and operate broadband wireless services, including WiMAX and other complementary services, in markets in the Middle East, North Africa and Asia. The Burraq Telecom investment follows on from ACTL’s earlier win of a 3.6 GHz WiMax license for Fixed Broadband Wireless Access (FBWA) in Jordan. Qtel owns 78% of ACTL, which owns a license in Jordan.
Managed Data Services
To strengthen its strategy in the Managed Data Services market, in late 2006, Qtel took a 38% equity interest in NavLink - the MENA region's leading provider of Managed Data Services. AT&T also has a 38% stake in the venture. Through NavLink, Qtel provides its top-end customers with true world-class network solutions in the Enterprise Data Market.
NavLink provides Qtel with access to some of the world's best technologists located in technology parks in the USA and Europe as well as unrivalled engineering skills in the Middle East. “Working in partnership with NavLink and AT&T, Qtel can provide our corporate customers here in Qatar with advanced business solutions and simultaneously deliver unparalleled reach out into the global market through AT&T's global network,” said Dr Marafih.
In early 2006 in Doha, Qtel set up the state-of-the-art Qatar Data Centre (QDC) that hosts the region's first AT&T Global Node. This connects directly to AT&T's vast global network and is a joint deployment between NavLink, AT&T and Qtel. The Data Centre provides large corporate customers with a safe and secure global connectivity and the use of QDC as a Managed Data facility that provides unparalleled levels of security and reliability.
The QDC hosts an advanced global networking service by connecting the Middle East to the AT&T Global Network (AGN) through more than 150 nodes in over 50 countries worldwide. The Doha node is not only the first AGN node to be deployed by AT&T into the Middle East, but is also the first AGN node to be owned by a foreign operator (Qtel), confirming Qtel’s role as a leading regional service provider. The AGN node is live in Qatar, UAE & KSA.
Business in Qatar
Qtel has achieved over 125% penetration in Qatar, with a mobile customer base of 1,108,000. Qtel’s business in Qatar continues to show good results with a revenue growth of 16.9% from QR 1,839 m in first six months of 2006 to QR 2,149 m in 2007.
Qtel Group Financial Results
The Qtel Group recently announced its financial results for the six months ended 30 June 2007. The consolidated revenues increased 97.4% to QR 4,014 million, with an EBITDA increase of 67.8% to QR 2,113 million. Wataniya group’s total customer base at June 2007 was 7.4 million (proportionate customer base - 4.9 million), representing revenues of QR 2,421 m for the first six months of 2007. The post acquisition revenues of Wataniya group up to June 2007, included in the Qtel Group results stood at QR 1,491 m.
“We have made significant investment in the Qatari market of around QR 1 billion a year over the last 3 years in fixed and mobile services, and continue to invest in our service and technology to deliver the latest services to our customers in Qatar,” said Dr Marafih.
