| Type | Public company (ADX:Etisalat) |
|---|---|
| Industry | Telecommunications |
| Founded | 5 October 1976 |
| Headquarters | Abu Dhabi, United Arab Emirates |
| Area served | Worldwide |
| Key people | Mohammed Hassan Omran Chairman Mohammed Al Qamzi CEO |
| Products | Fixed line and mobile telephony, Internet services, digital television |
| Revenue | AED 31.9 billion (2010) |
| Net income | AED 7.6 billion (2010) |
| Total assets | AED 42.6 billion (2010) |
| Employees | 11,000 (2009) |
| Website | http://www.etisalat.ae. |
Emirates Telecommunications Corporation, branded trade name Etisalat (Arabic: إتصالات Ittiṣālāt, literally, Communications) is a UAE based telecommunications services provider, currently operating in 18 countries across Asia, the Middle East and Africa. As of February 2011, Etisalat is the 16th largest Mobile network operator in the world, with a total customer base of more than 135 million.[1]
On 10 February 2011, Etisalat reported net revenue of USD $8.4 billion (AED 31.9 billion) and net profits of USD US$2.078bn (AED 7.631 billion).[2]
Etisalat is one of the Internet hubs in the Middle East (AS8966), providing connectivity to other telecommunications operators in the region. It is also the largest carrier of international voice traffic in the Middle East and Africa and the 12th largest voice carrier in the world.[3] As of October 2008, Etisalat has 510 roaming agreements covering 186 countries and enabling BlackBerry, 3G, GPRS and voice roaming.[4] Etisalat operates Points of Presence (PoP) in New York, London, Amsterdam, Frankfurt, Paris and Singapore.
Emirates Telecommunication Corporation – Etisalat was founded in 1976 as a joint-stock company between International Aeradio Limited, a British Company, and local partners. In 1983 the ownership structure changed – United Arab Emirates government held a 60% share in the company and the remaining 40% were publicly traded.
In 1991 the UAE central government issued Federal Law No. 1, which gave the corporation the right to provide the telecommunications wired and wireless services in the country and between UAE and other countries. It also gave the firm the right to issue licenses for owning, importing, manufacturing, using or operating telecommunication equipment. This practically gave Etisalat both regulatory and control powers, which completed the monopoly of the telecom giant in the UAE. In order to safeguard the country's economic development, the law made provisions for the development of the telecommunication sector in the country.
The increase of exchange lines from 36,000 in 1976 to more than 737,000 in 1998 was one of the important indicators of Etisalat network's growth and development.
An important milestone was Etisalat's commencement of international operations in January 2001, when under the brand name of Ufone it started operating out of Islamabad.[5]
Today Etisalat stands 140th among the Financial Times Top 500 Corporations in the world in terms of market capitalisation, and is ranked by The Middle East magazine as the 6th largest company in the Middle East in terms of capitalization and revenues. The Corporation is the largest contributor outside the oil sector to development programmes of the UAE Federal Government.
Etisalat has also won accolades from across the region for its nationalization programme.[6]
In addition to its telecommunication services provider and carrier units, Etisalat incorporates a number of additional non-telecom business units under the umbrella of Etisalat Services Holding LLC. These units support the company's operations and even provide services to other operators and organizations, namely: training and consultancy services(Etisalat Academy[7]), SIM/smart card manufacturing and payment solutions (Ebtikar[8]), data clearing house services (EDCH[9]), peering/voice and data transit (Emirates Internet Exchange – EMIX[10]), call center (The Contact Centre[11]),cable TV (eVision[12]), facilities management (EFM),[13] as well as submarine cable laying services (eMarine[14]).
Etisalat is a major investor in Thuraya (34.5%),[15] a satellite geo-mobile communication systems provider.
In 2006 Etisalat started a major restructuring program that resulted in the de-merger of many of its non-core business units operating under the telecom's centralized and direct management; core services were consolidated and streamlined, reflecting the company's shift from a technology-driven telecom to a customer-focused services provider.[16] As part of the program, Etisalat had launched a re-branding campaign, releasing a new corporate logo and identity in May 2006. The restructuring culminated in the incorporation of Etisalat Services Holding LLC, which as of 2008 oversees the operation of Etisalat's non-telecom business units with huge success stories .
Etisalat International Investments is the business unit of Etisalat that operates outside the UAE and manages the corporation's stakes in telecommunications carriers in Afghanistan, Benin, Burkina Faso, the Central African Republic, Gabon, India, Indonesia, Iran, the Ivory Coast, Egypt, Niger, Nigeria, Saudi Arabia, Sudan, Tanzania, Togo, Sri Lanka and Pakistan.
The International Investments unit also manages Etisalat's minor stakes in other telecommunications services providers, such as Sudatel (a mobile, fixed and Internet services provider in Sudan), and Qtel (Qatar-based telecommunications services provider).
The Emirati government, as part of its support to the National Transitional Council in the course of the 2011 Libyan civil war, requested that Etisalat assist the NTC restore mobile communications to the rebel-held areas of Libya, which had been cut off by the government of Muammar Gaddafi. Etisalat provided the equipment needed to restore the main mobile network of Libyana, the primary carrier in the country, to full capacity, and obtained a Tripoli-based database of phone numbers gives them information necessary to patch existing Libyana customers and phone numbers into their new system—which has been dubbed "Free Libyana." It includes a satellite feed through which the Free Libyana calls can be routed. [17]
One of Etisalat's first international investments was the bid to become the second mobile services operator in Saudi Arabia. Etihad Etisalat, a consortium led by Etisalat, won the 2G GSM license by offering US$ $3.25 billion. Currently operating under the brand name Mobily, Etihad Etisalat offers Saudi Arabia subscribers conventional and 3.5G mobile telephony services, and has floated shares on the Saudi stock market.
Among the acquisitions of Etisalat in 2005 was a 26% management stake in Pakistan Telecommunications (PTCL) that was put on sale by the Government of Pakistan as part of a large privatization initiative. In order to outbid competitors (which included Singapore Telecommunications and China Mobile), Etisalat offered USD $2.56 billion for the stake. According to some analysts, the telecom has overpaid, as the bid went far beyond the estimated USD $2 billion value of the package.[18]
In July 2006, a consortium led by Etisalat was granted the rights to develop Egypt's third mobile network, with a winning bid of 16.7 billion Egyptian pounds (EUR €2.29 billion euro).[19] The venture, Etisalat Egypt, competes with existing service providers Vodafone and Mobinil. On 12 September 2006, it was announced that the network would be built by Ericsson of Sweden, and Huawei of China, at a cost of approximately USD $1.2 billion.[20]
In 2007, at the Comms MEA Awards ceremony Etisalat was presented with the ‘Best New Entrant’ award for its Egyptian operations. Award winners were selected by a panel of experts from KPMG, the Arab Advisors Group and Oliver Wyman, Dubai.[21]
Etisalat is one of the founding partner companies of Canar Telecom, a fixed-line telecom services operator. In September 2007 Etisalat has raised its stake in Canar from 37% to 82% at an estimated cost of AED 584.17 million (USD $159 million).[22]
Canar was launched on 27 November 2005.[23] The operator is reported to use NGN and Wireless Local Loop (WLL) technologies for its voice, data, internet and multimedia services. Canar is one of the first operators in Africa to use an NGN network core.[24]
Etisalat signed an agreement to acquire 40% of and manage Emerging Markets Telecommunications Services, Nigeria’s fifth GSM operator.[25] It is now operating with about 5 million Subscribers, and recently signed an agreement with Main One cable company to launch one of the first major broadband service in Nigeria. It became a household name
ETISALAT bought 65% of Zantel Tanzania's shares and are joint owners with The government of Zanzibar (18%) and Meeco International of Tanzania (17%). Zantel has grown rapidly are the take over by ETISALAT and as of June 2007 they were the fastest growing operator in the region. Zantel has its own international gateway and was the first to reduce rates on international calls by 60%. Zantel was the first to introduce wireless internet in Tanzania Zantel was the first to introduce per second billing in Tanzania Zantel offers Internet and High Speed Data Network in Dar es Salaam and Zanzibar
In Africa, Etisalat acquired 50% of Atlantique Telecom’s shares in April 2005. Based in the Ivory Coast, AT owns mobile operators in Benin, Burkina Faso, Togo, Niger, Central African Republic, Gabon and Ivory Coast. In 2007, Etisalat increased its shares in AT to 70% and again in May 2008, to 82%. AT group subscribers totaled 2.9 million at the end of 2007, which is a 107% increase from of Benin, honoured Etisalat chairman, Mohammad Hassan Omran during a ceremony to celebrate Etisalat’s efforts in developing and promoting the telecommunications sector in Benin.
Indonesia-based mobile services operator PT XL Axiata (formerly PT Excelcomindo Pratama) is Etisalat’s first acquisition in the Far East. In December 2007 Etisalat took a 15.97% stake after paying USD $438 million (AED 1.6 billion). At the time of the acquisition XL had 15 million mobile subscribers.[22] As of Q2 2011, Axiata's mobile subscribers are about 38.8m.[26]
Etisalat Afghanistan is a newly established GSM operator, 100% owned by Etisalat.[27] It was established in May 2006 after the UAE telecom won the license to operate the fourth mobile services provider in the Islamic Republic of Afghanistan. Etisalat's bid for the license was USD $1.2 billion (AED 4.4 billion) and services were launched in August 2007.[22] Etisalat Afghanistan operates out of Kabul and as of 3 March 2010, the company has achieved 24 per cent market share in 27 provinces of Afghanistan.[28]
In January 2009 Etisalat in consortium with Tamin Telecom (a subsidiary of the Iranian Social Security Organization (SSO)) won the bid for running the third mobile services operator in the Islamic Republic of Iran.[29] The license included an exclusive two-year agreement for 3G services provisioning, but in Sep 2009 the licence was revoked and given to its local partner, Tamin Telecom.
Etisalat had planned to invest over $5 billion (AED 18.39 billion) over a period of five years,[30] but following the license suspension all plans for launching operation in Iran have been put on hold.
Etisalat acquired the Sri Lankan Operation of Millicom International Cellular (MIC), Tigo (Sri Lanka) on 16 October 2009. The acquisition was completed with a total enterprise value of 207 Million US$, out of which 155 Million US$ was in cash.[31]
Tigo (Sri Lanka) under the then brand name CELLTEL started operations in June 1989 on a Motorola TACS system and was the first cellular operator in Sri Lanka as well as South Asia. In January 2007, Millicom replaced the local CELLTEL brand with Tigo, their international brand. In February 2010, Tigo was rebranded as Etisalat.
Etisalat Lanka operates a GSM/EDGE supported network using 900 / 1800 MHz. The company on 5 May 2011 launched HSPA+ services over 2100 MHz, becoming the first LTE ready mobile network in the country.[32]
In 2009 Etisalat has announced that its Indian unit, erstwhile Swan Telecom (owned by Dynamix Balwas Realty and Reliance Communications),[33] headquartered in Mumbai, is renamed to Etisalat DB Telecom India Pvt. Ltd[34] The business unit has been awarded Unified Services Access License in 15 circles – Andhra Pradesh, Delhi, Gujarat, Haryana, Karnataka, Kerala, Maharashtra, Mumbai, Punjab, Rajasthan, Tamil Nadu (including Chennai), Uttar Pradesh (East), Uttar Pradesh (West), Madhya Pradesh and Bihar. In April 2010 Etisalat began signal testing in Chennai [IND 922], Delhi & NCR [IND 913], Maharashtra & Goa [IND 919], Mumbai [IND 916] and Gujarat[IND 914]. In May 2010, Etisalat was in talks to buy 25% stake in Reliance Communications,[35] but the deal was not finalised.
In 2010, following the $39 billion 2G spectrum scam, Etisalat DB, the Indian subsidiary of the company, was stopped from buying a stake in a Chennai-based company due to objections raised by the Ministry of Home Affairs (MHA). Etisalat DB was not allowed to buy back the 5.27 per cent stake held by Chennai-based Genex Exim Ventures since the home ministry raised objections based largely on security concerns. The MHA had pointed out four issues that needed to be resolved before allowing the company to come into Etisalat DB, a company that got scarce 2G spectrum at allegedly throwaway prices.
Etisalat UAE is headquartered in Abu Dhabi and includes three regional offices – Abu Dhabi, Dubai, and Northern Emirates.
Abu Dhabi Region
Key positions:
In the UAE, Etisalat operates where mobile penetration is already among the highest in the world "200%",[39] Etisalat became known for its efforts to roll out its Fibre-To-The-Home (FTTH) network in the UAE. By the end of 2009 Etisalat had completed the FTTH roll-out for 85% of households in Abu Dhabi, positioning the UAE’s capital as the first in the world to be covered by fibre.[40]
The advanced infrastructure allows the utilization of the most advanced technology applications to the UAE market. Its high-speed broadband internet enables users to enjoy multiple high bandwidth applications such as IPTV and online gaming in an integrated single interface for landline, internet and television-based services, providing a truly converged digital home experience to its customers.[41]
The Northern Emirates regional center is based in Sharjah and covers the telecom's operations in the emirates of Ajman, Umm Al Quwain, Fujairah and Ras Al Khaimah.
The number of Etisalat's Internet subscribers reportedly stands at 1.02 million.[42]
Some of the Internet services for home users that Etisalat offers include:
Etisalat also operates iZone, a system of Wi-FI hotspots in central locations, such as shopping malls, restaurants, and sheesha cafes. iZone can be accessed by either purchasing prepaid cards (AED 15/hour, USD $4.5/hour), or if using an existing account with the operator (AED 3/hour for dial-up account holders, or AED 10/hour for broadband users).
Dial-up and ISDN Internet access services are billed by the hour, whereas the domestic and residential cable and DSL connections have a fixed monthly rate depending on speed. Other Internet links, aimed at business users, have traffic utilization plans and relatively high rates when exceeding the allocated bandwidth quota. This has caused bad publicity for Etisalat and is a major source of criticism.
Etisalat operates an Internet content filtering system that blocks access to web resources. The web resources are claimed to be controversial or offensive (i.e. sexually explicit content, certain political and religious websites, anonymizers and proxies) or harmful (i.e. numeric IP addresses, known phishing or malicious websites, botnet command servers). The use of content filtering is mandated by the Telecommunications Regulatory Authority (TRA) of the United Arab Emirates.
The type of content that is restricted by Etisalat includes:
There are claims that Etisalat breaks the rules of net neutrality by throttling peer-to-peer, gaming and other types of network traffic in order to reduce the load on its oversubscribed international links. The effect of this interference is most noticeable during weekends or periods of high network use.
The overall efficiency of the country-wide content filtering is unclear, as many of the technologically savvy users have discovered tools and methods to bypass the content filter, such as using Tor.
In July 2009, Etisalat pushed an update to BlackBerry devices operating on the telecom's national network, citing performance improvements. However, it was later discovered[47] that the update contained eavesdropping software, developed by the US-based software development company SS8, which specializes in electronic surveillance. It is reported that the software enabled the company to monitor and forward communications on BlackBerry devices to their servers.[48][49]
Research in Motion, BlackBerry's developer, acknowledged[50] that the patch was a form of spyware, and issued a removal patch on 20 July.
On 27 December 2009, both Etisalat and Du (telco) have been mandated by the UAE telecom regulator to start filtering BlackBerry users' web access and block illegal content.[51]
Due to concerns with the security and the provisioning of legal interception for Blackberry non-voice services, on 1 Aug 2010, the Telecommunication Regularity Authority of the UAE instructed Etisalat that all Blackberry e-mail, internet and messenger functions must be suspended on 1 Oct 2010.[52] However, an agreement between Blackberry's developer Research In Motion and UAE's telecom regulator has been reached, and the announced BlackBerry services suspension has been canceled.
Blackberry Services currently do not work over WIFI and have been blocked by Etisalat. There is no clarification from the provider on this. Web Services using the browser function but blackberry messenger and email does not connect to blackberry servers over WIFI connections
The National Assembly (NA) Standing Committee on IT and Telecom criticized PTCL’s administration over its inability to fulfil obligations made to the government. On 20 December 2010, the committee met under the chairmanship of Chaudhry Muhammad Barjees Tahir, at the parliament house to probe into the privatization of PTCL. After hearing the officials of both the ministries, the committee declared that despite having outstanding financial portfolio, PTCL was privatized to an entity which did not fulfill contractual obligations despite the grant of concessions by the government.
On 01 Jan 2011, The Federal Minister for Privatisation Senator Waqar Ahmed Khan Wednesday revealed before the National Assembly that the privatization deal of PTCL with Etisalat was not transparent and made in violation of rules and procedures.
“The part of the privatisation of PTCL was not transparent. It was made in violation of the rules and procedures, said the minister replied to a question, and later, the House referred the matter to the National Assembly Standing Committee on Privatisation for sin.
It was told to the House that the SPA is completed and the transaction was made without the privatization of the Commission Council in confidence, adding that Etisalat 800 million U.S. dollars has kept the sport of land issue be transferred to the UAE-based company. Also, it was found out that around 3,500 properties were to be transferred to Etisalat which also comprise lands not even owned by federal or any provincial government rather either those are private properties are under litigation.
In June 2005, Etisalat $2.6 billion bid beat those of Singapore Telecom and China mobile for the purchase of a 26 per cent stake in PTCL, Pakistan’s telecom operator. Etisalat has management control with 26 per cent shares of PTCL, which was in 2006 for US$2.6 billion and is withholding $ 799,000,000 worth of initial payments to the Pakistani Government, part of the company’s 2006 properties with the acquisition in PTCL registered in name.
The Performance under control to Etisalat, PtCl wealth declined. For four years, before privatization, profit after tax increased from approximately 18 billion to more than 27 billion rupees, which is the rate corresponding to 11 percent annually.
The committee expressed its reservations over the entire privatization process and said, “it seems as if the previous government wanted to get rid of PTCL which was a profit earning entity at the time of its privatisation.”
The committee also expressed reservations over the exclusion of Telephone Industries of Pakistan from the privatization process, which was a subsidiary of PTCL.
Matter is still under investigation by the committee under his chairmanship and house is waiting for the committee's report.