Iraq looks to award fourth mobile licence by year-end

The Iraqi government hopes to raise as much as US$2 billion from auctioning of the country’s fourth mobile operator licence by the end of the year. The government will allocate at least a quarter of the licence fee towards improving the country’s telecom infrastructure, the communications minister told the Reuters.

The minister, Mohammed Allawi also said that he wanted to improve landline services, and use that to boost Internet penetration to 25 per cent within five years.

"Forty per cent of the shares of the new licensee (will go) to the operator, 35 per cent of the shares to the public, and 25 per cent of the shares to the ministry." he commented, confirming reports that emerged last year concerning the licence conditions.

The government has been increasingly frustrated by what it says is poor service from the existing three networks. Just last week Iraq’s telecom regulator, the Communications and Media Commission (CMC) ordered all of the country’s operators to stop interconnections with Zain Iraq’s "unlicensed lines".

Earlier this year the CMC accused Zain Iraq of using five million SIM cards without regulatory approval. The regulator handed Zain Iraq a US$262 million fine, to be paid by April 11.

In a letter sent to Iraq’s three mobile telecom operators on February 17, the CMC stated that no company had the right to activate or market any new line without the commission’s prior consent. It also requested that all telecom companies cease interconnections with unlicensed lines or face legal action.

The minister also said while network jamming by security forces was partly to blame for patchy mobile coverage, the operators’ infrastructure had been unable to cope with growing demand.

Both France Telecom and Etisalat are said to be in talks to take a stake in the smallest Iraqi operator, Korek Telecom, although the availability of an independent licence may prove more appetising to the bidders.