MUSCAT, JULY 9 – Oman’s two remaining mobile resellers — Friendi and Renna — down from a total of six that were originally licensed to operate in the local telecom market — have seen their market share grow to an impressive 17 per cent of total subscribers in 2017 — a growth trend that the Telecom Regulatory Authority (TRA) wants to sustain by scrapping the current bar on investment by the host operators in the shares of the resellers.
But ahead of any move to lift this restriction, the TRA has announced the start of a public consultation phase designed to elicit public feedback on this measure. As part of this consultative process, members of the general public have been invited to share their thoughts on two key points: Firstly, whether they believe that mobile resellers (also known as Mobile Virtual Network Operators or MVNOs) will continue to play a role in the telecom market offering competition to mobile network operators, and Secondly, whether the current restriction on shareholding of the host operators in Mobile Resellers be relaxed in order to achieve a better commercial relationship between the two entities.
The move comes 10 years since the TRA began issuing Class II mobile reseller licenses in 2008 to help stimulate competition in the mobile services market, dominated by two major operators Omantel and Nawras (now Ooredoo).
Of a total of six entities that received Class II licensees for mobile resale activities, one did not conclude any agreement and eventually relinquished its licence. The remaining five licensees — Friendi, Renna, Injaz, Mazoon and Samatel — signed agreements with host operators Omantel and Ooredoo to offer a range of services based on price discounts negotiated between the two sides.
Among the first to exit the mobile resale market “after incurring substantial losses” were Mazoon and Injaz, which surrendered their licenses in 2012 and 2013 respectively, according to the TRA.
“Friendi and Renna in spite of their initial years of losses performed reasonably well acquiring significant subscriber base and making profits as well. Samatel was acquired by TeO in 2014 (another licensee in the Telecom Sector) who later took over Renna’s operations (in 2016) as well. After acquiring Renna, TeO closed the erstwhile Samatel mobile resale business,” the Authority said in a consultation paper issued here on Sunday.
According to the TRA, the presence of resellers in the market has been beneficial both to the network operators and to the consumers. “The nimble operational set up of the MVNOs is a contributing factor for their ability to compete in the market and any overburden of resources could upset the margins,” it said.
Ten years on, TRA sees the need for a review and overhaul of the commercial relationship between the host operators and the mobile resellers in the interest of the licensees themselves, as well as the consumer market. In particular, it wants to roll back the proviso in current licenses issued to the mobile resellers that restricts the owning of shares of the licensee by the host operator.
“TRA would like to propose amending this provision permitting a higher percentage of holding of the host operator in the (mobile reseller), in order to foster a long-term relationship paving way for continued and sustained efforts between the entities to support one another,” said the Authority.
Interested respondents from the general public have until August 5, 2018 to submit their views to the TRA.