Global Insight Perspective | |
Significance | The network enables high-speed broadband up to speeds of 2Mbps and home users can obtain a bundled service for fixed-line voice and mobile services without the need for a land line. |
Implications | Zain faces competition from MENA Telecom, which is also in the process of deploying a WiMAX network in the kingdom, but also has the backing of the Kuwait Finance House (KFH). |
Outlook | Currently, Bahrain has in place all the requirements for a fully connected country; additional fixed-line communications will be substituted for WiMAX. |
Zain has taken less than a year to deploy a WiMAX network since winning the licence with MENA Telecom last year (see Bahrain: 14 December 2006: TRA Announces Two Winners of National Fixed Wireless Licences). Zain's new service, Zain@home, uses a nomadic system, allowing the customer to move home without the need to change his/her number, and also offers‘double play’—a fixed-line voice service and high-speed internet access in one package, providing a complete broadband service via a wireless network.
Dr Ahmed al-Shatti, Zain Bahrain’s chief operating officer, said, Zain@home epitomises our focus on enriching the lives of our customers. Our success lies in interpreting technology so that it impacts our customers in a way that improves their quality of life...The WiMAX service is a fine example of our philosophy—not only have we harnessed a cutting edge technology to create a dynamic new market, we have launched our Zain@home packages of tailor-made options with a full stack of generous offers so that our customers can reshape the way they stay connected and interact".
Zain is also the second mobile operator in the kingdom, ensuring that the completion of the WiMAX licence will enable the operator to provide full connectivity services to its customers. The deployment of WiMAX in the country is the cheapest available option to provide services to all residential customers; whilst Bahrain is amongst the smallest of the Middle Eastern countries, others larger countries such as Saudi Arabia are benefiting from the technology due to its ability to target densely populated regions without spending the time or money to deploy cables (see Saudi Arabia: 20 September 2007: Mobily Buys Bayanat for US$400 mil. and 29 August 2007: STC Selects Huawei for Commercial WiMAX).
Zain will now compete with incumbent Batelco for fixed-line and internet services and is currently offering competitive packages: the Zain@home service offers unlimited talk time between Zain@home network customers and free minutes to all local destinations, whether mobile or fixed-line. Furthermore, calls made from a Zain@home package to up to three designated Zain mobile numbers will receive a 50% discount and international calls will be billed in a ‘per second’ cycle. Individual email addresses will be offered to every customer with 24x7 customer service, while customers signing early will have their set-up fee waived and obtain their wireless unit at 70% off the listed price upon signing a 12-month contract, and up to 85% off if they take up an 18-month contract.
Outlook and Implications
Zain is now in a position to offer a range of services to all its customers in Bahrain. It is already taking a significant portion of Batelco's market share. The nationwide deployment of WiMAX means that Batelco will face competition in the country from Zain's services but also from MENA Telecom, which recently announced that it will also deploy WiMAX by the end of the year (see Bahrain: 17 September 2007: Mena Telecom to Launch WiMAX 802.16e by Year-End ). When MENA Telecom has its WiMAX network up and running at the end of the year—or possibly the early part of next year—competition will develop, making the operators compete over price as well as service quality; higher speeds are expected to be considers, further details about which will be announced in 2008.
Fixed-line penetration in the kingdom remains low at 27.5%; thus, there is enough market-share availability to allow Zain to provide a home phone service and internet connections. Zain will have to provide more competitive services prior to the launch of MENA Telecom's WiMAX service to prevent the future operator taking its market share.