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The UAE has a very well-developed, technologically-advanced telecommunications infrastructure and has high mobile telephone (over 95 per cent) and Internet penetration (40 per cent). Since 1976 majority government-owned telecoms corporation Etisalat, a World Top 500 company in terms of market capitalisation, has operated, maintained and developed the national and international fixed-line network, mobile telephony, Internet access and cable TV services.
However, recent government decisions provide for the deregulation of the market. The first step in the liberalisation of the sector was taken in May 2005 when the Telecommunications Authority (TRA) granted a licence to a new telecom provider in which the Pensions and Social Security Authority and other private sector shareholders hold a 40 per cent stake.
Etisalat is meeting the deregulation challenge on a number of fronts, including making the transition to an international corporation through strategic investment abroad. The corporation is rapidly establishing itself in international markets and is looking at further initiatives through Etisalat International, its newly-formed international investment arm that has been actively identifying and pursuing international investment opportunities. Etisalat reported revenues of Dh10.4 billion (US$2.83 billion) and a net profit of Dh3.4 billion (US$927 million) during 2004, an increase of 13 and 19 per cent respectively over 2003. Net profit is expected to exceed Dh4 billion in 2005.
Major growth is currently in the mobile telecom sector: by mid-2005 subscribers had reached 4,068,847 and revenue from mobile phones accounted for 55.2 per cent of total revenues, while fixed phones made up 25.9 per cent. In addition to its mainstream operations, Etisalat also provides specialised services through subsidiaries such as the cable TV company E-Vision, eCompany, which provides broadband access services, and E-marine, its submarine cable-laying company.
Etisalat is also a majority shareholder in the Thuraya Satellite Telecommunication Company and is Thuraya’s service provider in the UAE. Thuraya provides satellite-based communication solutions in urban centres and remote areas beyond terrestrial telecom networks, offering mobile and fixed telephony, rural telephony (through public call offices or PCOs), maritime communications, GPS tracking, and satellite Internet services across more than 120 countries spanning Europe, the CIS, Africa, the Middle East, and Southeast Asia.
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