CITC governor says telecom towers merger to cut cost, offer quality services

There is a likelihood among authorities to merge the towers of mobile telecommunications companies, as this approach is used by many developed countries to reduce costs, Communications and Information Technology Commission’s (CITC) governor, Mohammed bin Saud Al-Tamimi, said.

The merger will be upon the telecom operators’ request and will not be mandatory, Al-Tamimi told CNBC Arabia.

He indicated that CITC will monitor the merger of telecom companies' towers to reduce costs and focus investment on quality services that affect the end-user.

The number of fifth generation (5G) towers has reached more than 8,000, covering more than 37 cities in the Kingdom, the governor said, adding that Saudi Arabia currently ranks fourth in the world in the deployment of 5G networks, with average speeds exceeding 400 megabits per second.

Al-Tamimi also said that the prevalence of wireless services amounted to 130%, and that of internet use reached 96%, while the spread of internet coverage in populated areas reached 99%.

Elsewhere, the authority has re-engineered postal sector licenses and reduced the requirements for investors by 85%, indicating that the number of current licenses stands at more than 22 licenses at the local or global level.

CITC is working on preparing a special postal system to be a catalyst for investment, as it is currently witnessing high competition, whether from local or international investors, Al-Tamimi added, expecting that the annual increase in the size of the SAR 5 billion market will be between 10% and 13%.

In July, Mobile Telecommunication Company Saudi Arabia (Zain Saudi) and Etihad Etisalat Co. (Mobily) signed a non-binding memorandum of understanding (MoU) to form a joint committee, to prepare and offer a request for proposal (RFP).

The options included purchasing the telecommunications towers owned by the two companies, merging them into one company with other investors or operating them on their behalf, according to data compiled by Argaam.

Earlier in June, CITC disclosed its intention to enhance the regulatory environment for mobile communication towers by increasing the participation rate by service providers through mergers in ownership of the towers or their acquisition by interested investors, with the aim of reducing their capital and operating costs as well as achieving maximum efficiency, including cutting the maintenance costs of these towers.