By El-Sayed Solyman
Cairo – Mubasher: Telecom Egypt (TE) has been granted a license to operate a fourth-generation (4G) mobile phone network in Egypt, said the spokesman of the Ministry of Communications and Information Technology (MCIT) on Sunday.
"Now the company officially holds the license. It will make an announcement on Wednesday in the presence of the communications minister", the spokesman told Mubasher.
The landline monopoly is thus the first company to have a 4G license and frequencies in Egypt at EGP 7.08 billion, of which 50% will be paid in US dollar, the spokesman added.
MubasherTrade Research said the 4G license will place TE as a competitive and comprehensive telecom service provider compared to the other three network operators, but this step is no void of significant challenges.
The first is the frequencies' high cost along with the capex required for mobile infrastructure, "which will increase the debt leverage and financial burden on TE".
In addition, the high mobile penetration rate at 111% lowers the potential to capture a huge number of subscribers.
The company's margin is further likely to be negatively affected on low mobile's average revenue per user and strong pricing competition.
Finally, this step may raise the probability of selling its 45% stake in Vodafone Egypt (VFE) to avoid an explicit conflict of interest.
In the mid-week trading session, the stock quote steadied at EGP 9.80 per share after 1.2 million shares were traded at EGP 11 million.
Translated by Ahmed Elsayed Ali
