UAE’s second mobile operator, du, is expected to post its first year-on-year net profit six months earlier than anticipated when it releases its Q308 financial results later this month, according to a Dubai-based investment advisory firm.

Du said last year it expected to become profitable in the first quarter of 2009 after having launched in February 2007, however, a forecast report by Al Mal Capital Research suggests the operator will announce third quarter profits of AED40.94 million (US$11 million) compared to the same period last year.

The report also forecasts that du’s revenue will rise to AED937.69 million, an increase of 127.5 per cent year-on-year.

“This is the much-needed positive start they’ve been waiting for,” commented Alok Nawani, an analyst for Emaar Financial. “Du is the only way for foreign investors to get exposure to UAE telecoms since Etisalat does not allow foreign investors, so this is positive.”

The UAE’s Telecommunications Regulatory Authority today announced the extension of the deadline for the submissions of proposals from parties interested in acquiring a single mobile TV licence on offer in the country. The new deadline has been established at November 16, having originally been set at October 19.

Both UAE providers have been piloting mobile TV services, however, only one licence will be up for grabs

The mobile TV licence on offer in the UAE permits the successful bidder to roll out a mobile TV network and to begin offering transmission services. It will be allowed to sell the mobile TV transmissions to retailers in a non-discriminatory manner, acting as a provider of mobile TV service on a wholesale basis to retailers.

The cost of the 10-year licence amounts to AED17 million (US$4.7 million), together with an ongoing annual licence fee amounting to the higher of: one per cent of the revenues earned in a year; or AED100,000. The licensee will also be required to pay an annual royalty, equivalent of 30 per cent of its net profit before the royalty.

It is significant that the UAE TRA has opted to only offer a single mobile TV licence given that both incumbent operators in the country have expressed an interest in the service and have been piloting services.

According to the licensing conditions, citizens of GCC countries may hold up to 100 per cent of the shares in the mobile TV licensee. Investors from outside the GCC are however not allowed to hold shares in the licensee.

CEO and senior management succession planning is a critical area for telecoms operators, yet is an area where operators have not done particularly well in, according to a consultant from strategic management firm Arthur D. Little.

Klaus von den Hoff of Arthur D. Little believes telecoms operators need more careful consideration of their succession planning to ensure their leaders reflect the changing market

Global practice leader for the telecoms, information, media and electronics (TIME) practice, Klaus von den Hoff, said that the first generation of telecoms managers are still leading many mobile operators, while the market dynamics have progressed significantly. He believes that companies need to carefully plan their successions in order to select a generation of leaders that will drive growth within a much more dynamic and multifaceted environment than the original leaders would have been accustomed to.

“The first generation had to master the challenge of building and rolling-out networks and selling a simple product. Strict cost-management wasn’t an issue while profit margins were high at around 40 per cent,” comments von den Hoff.

“Meanwhile the market has changed dramatically and is now characterised by hyper-segmentation in marketing, an innovation race in product management and technology, and a permanent need for strict cost-control.”

Zoran Vasiljev, a director of Arthur D. Little in the Middle East, asserts that since the 1990s there has been an explosion of complexity in the telecoms market, which the new generation of leaders must adapt to and manage. However, the succession of leadership and management style at operators has not changed much to reflect this.

An example of the increase in complexity is the number of product launches an operator would make per year. In the 1990s an operator would launch less than five products per year, in early 2000s that number had increased to between 10 and 20, and the current average of new product launches is between 20 and 40.

Some companies have tried to deal with the change by instituting cross-business management – moving executives from the fixed-line business to mobile and vice versa – or bringing in fresh blood from the consumer industry. For example, Vodafone Group did the latter when it started to push the brand globally, hiring executives from Coca Cola, Pepsi and Mars.

Nokia is launching its first online Nokia Music Store for the Middle East in the UAE, allowing consumers to be able to purchase a wide range of music from major regional and international artists, commencing December.

Consumers can preview a 30 second clip of any track in the Nokia Music Store before purchasing

The Middle East’s first store will be Nokia’s 12th rolled out globally alongside such markets as UK, Germany and Australia, and is the first in an emerging market.

The website will include interactive features such as music browsing, personal track recommendations and streaming services, and will offer international, Arabic and Bollywood music collections from global and regional labels including Universal, Sony BMG, Warner, EMI, Rotana and Qanawat.

“The Nokia Music Store is a fantastic way to build a music collection that is truly mobile, where users can be confident that they are legally downloading music that is high quality and risk free,” commented Chris Braam, vice president of sales for Nokia Middle East and Africa. “It brings a new kind of experience where people can preview, try and discover new music on their PC or on their mobile device like never before.”

The online store will be available at http://music.nokia.ae and offers consumers the option of listening to a 30 second clip of any track, before they buy individual songs, complete albums or a monthly subscription for PC streaming.

More than 6,000 Alcatel-Lucent employees are calling for outgoing CEO Patricia Russo to forego her golden parachute severance payments worth more than US$9.4 million, and for chairman Serge Tchuruk to give up his merger bonus received in 2006.

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