|
Viewpoint, VoIP,
Telephony, UAE, MENA: Developing-market observers are very often impressed with
the way that Middle Eastern countries have shown the greatest enthusiasm for
implementing telecoms technologies. One recent disappointment, however,
concerns the termination of Skype telephony in the United Arab Emirates. Developing Telecoms attempts to set out the background to this
action, and to find out the reasons for it.
 One of the most encouraging
technologies involving Internet telephony has been the Skype system. Its
popularity, not say its competitive prices, have been endorsed by many users,
not least those foreign residents in the United Arab Emirates. And as we know the foreign component of the UAE’s population forms
the overwhelming majority. All these residents perform the telephonic
equivalent of voting with their feet when they enjoy Skype’s IP rates of
US$0.02 per minute.
Enjoy? Well, that should read enjoyed. Skype is now closed
to the UAE, as the Telecom Regulatory Authority (TRA) has cut access to the
system. Result? Call rates per minute to the USA in
peak hours of US$0.60 and US$0.75 to the UK. And
an unhappy workforce. Not to mention Etisalat profits up 30% and 41% for the
second and third quarters this year respectively over 2005.
To set this development in context, Bahrain
is currently the only Gulf state where it is legal to make an Internet
telephony call. There have been well-publicised efforts in the past by
governments to ban the Internet in general. Saddam Hussein’s Iraq and
BBC broadcasts being blocked by China
come to mind. It should also be mentioned that the USA’s
Federal Communications Commission imposed a US$15,000 fine on a company called
Madison River Communications which attempted to block rival services.
So why the UAE and
why now?
Well, there is the simple question of money. As mentioned,
the UAE operator Etisalat has seen its profits rocket in the months since the
ban. The chance to make money would be a simple explanation if the situation was
that simple. However, the UAE is generally regarded as quite a competitive
environment.
Skype’s background is that it was bought by eBay, and the
latter was keen to spread its wings and provide IP telephony to markets
worldwide. That is its undoing, at present at least. For it appears that
easily- accessible, customer-friendly pricing have ruffled some Gulf feathers.
Read what Mohammed Ghuaith, Director of Technology for the Emirates TRA, has to
say: “People don't understand the harm of a provider that has no obligations to
this country…Are the conversations secure? Are they being recorded? Will they
steal information? Will they sell it? These are the things we need to look at.”
Now, Developing Telecoms fully supports the empowerment
that low-cost telephony can bring to emerging markets. And in Mohammed Guaith’s
defence, he acknowledges the arrival of a more competitive playing-field. It’s
just that the questions he asks of a foreign IP provider are exactly those that
a citizens had every right to ask of his or her own country’s old-fashioned
state-run monopolistic plain old telephone service. The director accepts change
but insists that it must be brought about gradually.
Many businesses operating in UAE, in addition to residents,
are feeling the pinch. Skype's instant-messaging service could be and was used
as an inexpensive way of bringing overseas-based operations together.
However, is there by
any chance another reason for the UAE’s decision?
Can we mention that a company called Efonica is making a
bid to become the most subscribed-to VoIP provider, even above Skype? Yes, is
the short answer. And where is this Efonica based - in Dubai, perhaps? Yes
answers the second question as well.
Early 2007 is expected to be the date for the legalisation
of IP telephony in Dubai. And there will be Efonica ready to hoover up the calls and the
profit. The regional director for Efonica is clear: “We aim to be ready as soon
as the TRA makes an announcement.”
Observers of VoIP are waiting to hear the tariffs to be
charged by Efonica.
The same regional director is confident that TRA will allow
IP calls to be free of charge. What happens if there is any third party which
in turn needs to impose a charge remains to be seen.
Efonica is wholly owned by Fusion Telecommunications, a
company listed on the New York Stock Exchange. Several operators worldwide have
teamed up with the company. Licences already exist in Bahrain
and Jordan, with Saudi
Arabia set to follow
next year.
So, will Efonica team up with Etisalat? Will Skype be allowed
to return? Efonica is keen to publicise the strengths it believes it has over
other VoIP systems, with prices for the subscriber, and lower costs for the
carrier when delivering the service, being two of the advantages asserted by
the company. There is a third bonus which Efonica is keen to stress, namely
entering phone numbers via a simple screen, a facility called efoLink.
Everything OK so far? Efonica and its promoted benefits
ready for exploitation by an ever-more “wired” population? Sorry to disappoint
everyone: problem is, oh dear, that the Efonica website is, wait for it, banned
in the UAE…
Local press coverage has been sympathetic to Skype users.
The cumulative effects of the bans have been condemned in the newspapers as a
hindrance to technological advancement.
In fact, even allowing for the reasons put forward in this
review so far, one still asks why the UAE should impose a ban of any sort. Her
Internet penetration rate is high -and can only become higher with the arrival
of new systems.
Blocking can often be halted in the short-term. This is all
too true of Cambodia (Developing Telecoms: Cambodia 3G mobile
ban astounds phone industry, 7 June, 2006). In 2002, the
Panamanian government saw its attempt to block VoIP overturned by its Supreme
Court.
If legal challenges fail, telecoms specialists will find
technological methods of avoiding such hurdles. At its bluntest, blocking is
futile as people will find ways around it.
more info:
|
Date: May 19, 2008
