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Egypt’s operators change their tune on 4G licences with new deals

After refusing the bid in last month’s spectrum auctions, Egypt’s operators are now acquiring 4G licences through agreements with the country’s regulator NTRA.

Etisalat and Vodafone Egypt are now following Orange Egypt’s volte-face on 4G licences after snubbing the auctions. All three operators had previously dismissed the auction terms, claiming that they did not provide enough spectrum and expressing disapproval of a stipulation that half of the fees should be paid in US dollars.

Last week, Orange signed a $484 million deal with the NTRA for a 4G licence following a revision to the spectrum acquisition conditions, agreeing to pay 50% of the fee in US currency. While it has not been revealed if Etisalat and Vodafone have agreed to the same condition, they have disclosed that they will respectively pay $535.5 million and $335 million for their licences.

Vodafone stated that “the agreement availed additional spectrum to complement Vodafone’s existing strong spectrum holdings relevant to 4G”, with CEO Stefano Gastaut adding: “The terms and conditions we signed… are different from three weeks ago, we consider the terms now completely satisfactory to launch top quality 4G services.”

Gastaut noted that Vodafone now holds the most spectrum of any operator in the country, although Etisalat confirmed that it was planning to acquire a further 10MHz.

The auction formed a key pillar of the Egyptian government’s plan for reforming the telecoms sector and bringing in US currency. The regulator noted that it was considered opening the auction up to the international market following the lack of interest from domestic operators.

Telecom Minister Yasser al-Qadi said:”Now that the four companies have signed the 4G license, the telecom sector has raised $1.1 billion, in addition to EGP10 billion ($1.13 billion) for the state budget.” NTRA head Mostafa Abdel Wahed added that payments would be made in full rather than instalments.

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