Regulator bans VoIP in cyber cafés; announces second fixed licence

12 Mar 2007

Oman’s Telecommunications Regulatory Authority (TRA) has banned the popular voice over internet (VoIP) telephony services offered by many cyber cafés and enjoyed in the main by expat workers from Pakistan, India and Bangladesh. A statement issued on 7 March 2006 read: ‘The TRA noticed lately that a number of internet cyber cafés offer basic voice service through the internet provided by foreign companies that are not licensed to provide telecoms in the Sultanate.’ Only the incumbent Omantel is currently licensed to offer VoIP, and the TRA warned that punishments for violating Royal Decree No. 30/2002 (providing voice services without a licence) ranged from a fine of up to OMR50,000 (USD130,000) to two years in prison.

Meanwhile news has emerged that the TRA intends to licence a second landline operator in the future, possibly later this year or early next. The incumbent Omantel currently has a monopoly of fixed line services, although it has faced competition in the mobile sector since 2005, when a concession was awarded to Nawras. Liberalisation of the telephony industry is part of the Omani government’s commitment to the World Trade Organisation to open up the services sector. Omantel, 70%-owned by the government, has said it is ready for competition, pointing to the investment made between 2004 and 2006; OMR100 million (USD260.8 million) of which went on its fixed line network. At the end of 2006 Omantel had around 271,000 wireline customers, representing a teledensity of around 11%.

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