1. Telecommunication Regulatory Authority Investing In Infrastructure Telecom & ICT Opportunity 13 April 2008 ألاقتصاد والأعمال Al-Iktissad Wal-Aamal Conference www.tra.gov.om

2. Overview  Market Profile.  Market Statistics.  Market Forces.  Challenges & Solutions.

3. Omani Telecom Market Profile Fixed Market: –single licensed operator. –10% Teledensity (2007). –66% households penetration. –2.2% CAGR for the last 6 years. –Prepaid segment with higher growth.

4. Omani Telecom Market Profile Mobile Market: –First GSM network introduced in 1996 –Second mobile operator in Mach 2005 –GPRS, EDGE and 3G services – 96% Penetration rate (2007) –46% CAGR per annum after liberalization.

5. Omani Telecom Market Profile Geographical coverage (2007) Region 89%Muscat 80%AlBatinah 55%Ash Sharqiyah 77%Al Dhahirah 73%Ad Dakhiliya 33%AlWusta 45%Dhofar 71%Musandam 57%AlBuraimi

6. Omani Telecom Market Profile Internet Market: – single provider (incumbent operator). –6.8% growth per annum since 2001. –High demand for broadband services. Subscribers(2007)Type 50KDialup 20kBroadband 2kLeased lines

7. Omani Telecom Market Profile Requirement in the legal frame work in the telecom act (Article 38 of the telecom act) Government USO Initiative Pilot project for the first phase to be auctioned, might not be economic viable and might attract subsidies according to the telecom act article 39.

8. Room for Growth

13. Threats of new entrants Bargaining Power of consumers Threats of substitutes Bargaining Power of providers Telecom Market Forces Telecom Market Competition

14. Forces on the Omani Telecom Market Public demands forces Technological driving forces Ecological driving forces Political driving forces Economic driving forces Increase in demand for better QoS Increase in demand for new innovative services Purchasing power of customers Demands on cheaper Telecom services Culture requirements Legal Framework E-government Initiative WTO FTA USO Competition Potential market size Usage patterns Pricing policies Public safety Frequency bands availability New emerging technologies and standards Convergence of networks into single one Internet /E-business technologies Innovation/ Repacking Telecom market

15. Steps Towards Addressing the Challenges Local loop unbundling Introduction of Carrier select/pre- select Introduction of VoIP Next Generation Networks Opening of telecom market Unified licensing (International, submarine cables, long distance, Wireless Broadband Access).

16. Challenges to the new entrant Challenges Capital requirements Economies of scale Product differentiation Brand performance/customer loyalty Access to distribution channels Cost advantages of the Incumbent Expected retaliation Legislation/government action

17. Threats of Substitutes Challenges Offer competitive product mix for subscribers to lure from respective competitor Demonstrate high perceived QoS Tendency of subscribers to switch to new provider Consumer disposable income