Oman – Telecommunication

Overview
Demographics

Population: 2.6 million

GNI per capita: US$ 6610 as per

Profile of the population : 3,80,000 Indians

Major Infrastructure Project Underway :

Telecom History
Regulatory Authority
http://www.tra.gov.om/test1/index.htm

Wireline
There is a plan to introduce competition in this sector to counter the monopoly on
OmanTel in this sector. Under the terms of Oman's commitment to the World Trade
Organisation (WTO), the regulator was aiming to introduce competition to the fixed
telecoms sector by the start of 2004. This has not been done but there is a move in
2006 to introduce competition in this sector

Wireless
OMTC's parent Omantel is the only operator authorized to operate an international
gateway, and Nawras is obliged to route international calls through it. The regulator
has ruled that interconnection charges should be cost-based although a profit
margin is still permitted.

Broadband
In April 2006 the TRA made a statement addressing the blocking of unlicensed voice
services by Omantel. It stated that IP telephony/VoIP can only be provided by 'class
one' fixed line telecoms license holders as stated in the Telecommunications Act
issued under Royal Decree 30/2002. Omantel remains the only company in the
Sultanate licensed to provide public voice services and has full rights to curb any
illegal voice operating activities.

1
Details of Traffic & Subscribers
World Bank Figures
Variable Oman Column1 India Column2
(Group:
Middle East (Group:
and North South
Africa) Asia)
actual normalized actual normalized
Total Telephones per 1,000 People, 2004 412.6 4.12 84.5 6
Main Telephone Lines per 1000 People, 2004 94.9 2.35 40.7 6
Mobile Phones per 1,000 People, 2004 317.7 5.29 43.8 6
Computers per 1,000 People, 2004 46.6 3.53 12.1 6
Households with Television (%), 2004 79.2 2.35 37 6
Daily Newspapers per 1,000 People, 2000 n/a n/a 60 6.67
International Internet Bandwidth (bits per
person), 2004 n/a n/a 11.4 5
Internet Users per 1000 People, 2004 96.7 4.71 32.4 8

Price Basket for Internet (US$ per month), 2003 23.6 5.88 8.7 8
Availability of e-Government Services (1-7),
2006 n/a n/a 3.55 7.5
Extent of Business Internet Use (1-7), 2006 n/a n/a 4.6 8
ICT Expenditure as % of GDP, 2005" n/a n/a 5.91 5

Subscriber Projections (if Possible)

Refer to the excel sheet Excel
Files\MiddleEast_CompanyWise_Subscriber_Base.xlsx

ILD (Outgoing Minutes)

Refer to the excel sheet Excel Files\MiddleEast_Outgoing_Traffic.xls

Major Players
Oman Mobile Telecommunications Company (OMTC)

Ownership
Omantel is wholly owned by the state

Services Offered
Wireless : The bulk of OMTC's subscriber base (around 75% at the end of March
2006, up from 68% at end-2004) is signed up to its 'Hayyak' pre-paid service, and

2
revenues from the pre-paid sector made up well over 50% of the total in 2005, up
from 34% in 2002. OMTC sees a decline in ARPU as inevitable as the number of pre-
paid subscribers continues to grow. In June 2006 it launched a promotion offering
Hayyak SIM cards free of charge with certain handsets, and followed this at the
beginning of August by reducing the tariffs of its post-paid 'Mada' packages.

Tariffs
1. For IDD dialing rates to India refer to Excel
Files\MiddleEast_CompanyWise_Tariff.xlsx

Other Interests
None

OmanTel ( Oman Telecommunications Company)

Ownership
70 % state 30% other investors

Services Offered
Wireline: As well as traditional voice services for residential and corporate
subscribers, Omantel provides pre-paid home phonecards, dial-up internet access
('Omannet'), pre-paid internet cards ('Al Multaqa'), cybercafé services, ISDN and
ADSL ('PowerNet') connections, leased lines, managed data networks and VSAT
services. It also operates a network of around 6,700 payphones, and its pre-paid
fixed line service is growing in popularity, with 31,359 users as of May 2006, up
from 25,422 at the beginning of the year (12,300 at end-2004).

Broadband: In addition to voice services, Omantel provides dial-up internet

('Omannet'), pre-paid internet cards ('Al Multaqa'), cybercafé services, ISDN and
ADSL ('PowerNet') connections, and leased line internet access, managed data
networks and VSAT data services.

Other Interests
Omantel has raised its international profile through a series of tie-ups with overseas
operators. In May 2004 it signed an agreement with India's Reliance Group
subsidiary FLAG Telecom to lease capacity on the latter's extensive international
fiber-optic network, and the pair have activated two landing stations in the
Sultanate for submarine links stretching to Egypt in the west and Hong Kong in the
opposite direction. In August 2005 FLAG's FALCON undersea cable system was
rolled out from Seeb to Reliance's landing station on India's west coast, and two
months later Omantel collaborated on a project to extend a second submarine cable
from Khasab to the Gulf Cooperation Council states and Iran. A further FALCON/FLAG
cable rollout was initiated in April 2006 to connect Oman with Europe and the
Americas via Egypt, and in July Omantel launched a project to directly link Seeb to

3
Karachi in Pakistan via a 900km submarine cable, in partnership with Pakistan's
Trans World Associates (TWA). Alongside this project, the Seeb landing station is
being upgraded, giving it the status of a multiple link hub for FALCON, FLAG and
TWA. Omantel also provides interconnectivity with submarine cable systems SEA-
ME-WE 3, Indo-Gulf and Finjairh-Jusk. It has a partnership agreement with Swedish
firm MCA, in place since March 2005, to offer international corporate voice, internet,
data and video services via IP-VSAT technology.

Nawras Telecom

Ownership

Nawras must contribute 12% of its annual gross revenues to the government's
national telecoms fund.

Services Offered
Wireless : Nawras' concession allows 3G services (it is technology-neutral). On 21
December 2005 it announced it had completed its first successful W-CDMA test call,
and it has since expanded a pilot 3G networks to cover selected areas in the main
cities of Muscat, Salalah, Sur, Nizwa and Sohar. Nawras is currently trialing 3G video
calling and internet browsing with selected customers in the Muscat area, and is
expanding the scope of the trial across the country, with a commercial launch a
possibility before the end of 2006. Swedish vendor Ericsson has been chosen as its
main supplier of 3G network equipment.

Tariffs
1. For IDD dialing rates to India refer to Excel
Files\MiddleEast_CompanyWise_Tariff.xlsx

Other Interests
None

4
News
1. Former monopoly Oman Telecommunications Company (Omantel) said
yesterday that it was considering buying ‘a big share’ in a Pakistani telecom
company to expand outside its home market.

2. Omantel, currently the country’s only licensed ISP, has launched a network of
20 Wi-Fi hotspots across the capital Muscat. The service is available to all
post-paid internet subscribers. According to TeleGeography’s GlobalComms
database, Omantel had 13,000 ADSL subscribers at the end of 2006.

3. Second Emirati cellco Du, which is to launch services next month, has inked
an interconnection pact with Omantel, the incumbent in neighbouring gulf
state Oman. The deal covers voice interconnection and international data
services. The exchange of traffic between the two operators will take place
via the FALCON submarine cable

4. Omani incumbent Omantel is interested in acquiring an equity stake in FLAG

Telecom, a wholly-owned subsidiary of Indian giant Reliance Communications.
FLAG is seeking to divest up to 20% of its share capital to raise USD200
million.

5. Work has begun on laying the submarine sections of Flag Telecom's FALCON
fibre-optic cable system, to link the Middle East region to India. Cable laying
operations will stretch 1,700km from Al Seeb in Oman to Reliance Infocomm’s
landing station on India's west coast. The cable loop will commence carrier
services in the last quarter of this year.

6.