Tuesday, Sep 06, 2011
(This item was originally published Monday.)
DUBAI (Zawya Dow Jones)--Bahrain's Telecommunications Regulatory Authority, or TRA, said Monday it had issued notices to Bahrain Telecommunications Co. (BATELCO.BH), or Batelco, and Saudi Telecom Co.'s (7010.SA) Bahraini unit warning them that their pricing of certain international mobile phone calls was anticompetitive and not in the interest of consumers.
The TRA, in an emailed statement, said it had investigated complaints into the pricing for mobile phone calls to certain international destinations and had issued separate notices to the two companies that "allege that the operators' pricing constituted an abuse of dominance in the international mobile telecommunications market, and breached the conditions of competition provided for by the law."
The regulator said it would make a final decision on the issue once it has received Batelco's and Viva's responses to the notices.
"Batelco and Viva will have until Oct. 13 to respond to our notice," TRA spokesman Abdulelah Abdulla told Zawya Dow Jones by telephone. He added that the notices were related to calls to destinations such as Bangladesh, Sri Lanka, Philippines, Pakistan and India.
Three licensed mobile phone operators compete in Bahrain--Batelco, STC Bahrain, which operates the Viva brand, and MTC Vodafone Bahrain. Numerous smaller operators have individual licenses for international prepaid calls.
"TRA believes that such pricing destroys the market's forces and hinders competition between operators by reducing the opportunities for fair competition in the market, and harms the interests of consumers in the long run," the watchdog said.
"Batelco has been informed of this decision and is in process of making a detailed submission to the TRA outlining reasons why we believe we acted fairly and consistent with the regulatory and competitive laws of the Kingdom," said Rashid Abdulla, the chief executive officer of Batelco Bahrain in emailed statement. "We look forward to the opportunity to outline our case to the TRA and we are confident we will receive a fair hearing."
STC Bahrain declined to comment.
One telecom analyst said the regulator's decision won't have any "drastic" implications for Batelco or Viva.
"The TRA is doing its job to prevent aggressive competition so other operators don't suffer. Eventually Batelco and Viva will have to reduce their prices. This will reflect on their market share, but could help margins as prices increase," he said.
Batelco shares closed 0.50% higher Monday at BHD0.402 on the local bourse.
-By Shereen El Gazzar, Dow Jones Newswires; +971 444 61684; Shereen.elgazzar@dowjones.com
(END) Dow Jones Newswires
06-09-11 0418GMT
