Overview and Management of Ooredoo Oman and Econet Wireless Burundi

Paper Type:  Essay
Pages:  6
Wordcount:  1636 Words
Date:  2022-05-26


In the last few decades, the process of globalization has affected even the most underdeveloped countries. The effect has become evident in every aspect of life including how people live and how businesses operate. As international competition continues intensifying, many governments have found themselves changing their culture and policies to allow a flexible environment for the establishment of companies. The intention is to create opportunities for growth and stay ahead of the competition as many developing economies try to be on par with the advanced economies. Although challenges emanating from the availability of resources, differences in culture and even the general infrastructure have been evident, international investors have been targeting the developing economies due to their prospects.

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In the telecommunications industry, most governments are keen since technology is rapidly taking over most sectors. Proper governance ensures that technology is not used recklessly to cause unnecessary concerns. While some countries allow freedom in most aspects of telecommunications, others are keen to monitor the industry closely through regulations and restrictions. Businesses, whether private or public, have to adhere to the policies to retain their licenses. With services such as the internet as well as the voice services, smaller companies have found it hard to survive in the industry, which is dominated by majorly large-sized companies. Regardless, some countries such as Burundi offer a conducive environment that may appeal to investors who may desire to invest in the telecommunications industry.

With a high population density and low barriers to entry, Burundi's telecommunications industry is one of the most attractive sectors for local and international investors. On the other hand, the Oman telecommunications industry is one of the most competitive mainly because of the concentration of telecommunication companies. Whilst the Omantel and the Ooredoo Oman may be the most dominant companies, the entrance of Friendi and Renna poses a significant threat to their market dominance. Whilst the two industries may differ, they are also similar in that the telecommunications authorities in both countries play a significant role in controlling or restricting what information the companies can access as well as the day to day conduct regarding confidential user information. To understand the international legal business environment about the telecommunication industry, it is essential to understand particular Oman and Burundi telecommunications legal environment.

Overview and management of Ooredoo Oman and Econet Wireless Burundi

A summary of the company

This is a renowned telecommunications company in Oman, currently owned by the former Qtel group (Nawras Company), which is presently known as Ooredoo. It is a privately held company serving more than 2 million customers in the country. The services and products offered include data services, voice, and others such as fiber, prepaid and postpaid mobile plans and 3G+ (BuddeComm, 2018). In the Muscat Securities Market Ooredoo, Oman telecommunications is the fourth largest telecommunications market as per the market capitalization. The company was founded in 2004. Initially known as Nawras, the company changed the name to Ooredoo in 2014. Ian Charles Dench who was the founder is also the CEO. The company has its headquarters in Muscat in the Sultanate of Oman. The company employs more than 1, 000 employees, therefore, playing an essential role in the local as well as the national economy.

Although the company has been dominant in the past, the market share has declined by 5% in the last five years (BuddeComm, 2018). The Oman government is committed to bringing down prices while improving the quality of services. As such, approval of telecommunication licenses for the establishment of telecommunication companies is a lengthy and thorough process. The approval is done by the Ministry of Telecommunications after a thorough process establishing whether the investor is capable of meeting the requirements of operating in the industry. This makes it difficult for new entrants willing to invest in the industry. The Telecommunications Regulatory Authority (TRA) has often found it challenging to policy and control the sector (Mukrashi, 2016). However, current systems make it illegal to monitor telecommunications unless approval by the court is given. As such, the TRA issues technical specifications as well as the professional criteria that companies have to follow in the industry to protect the consumers while preventing abuse of privileges.

Operating in the Oman Telecommunications industry

In Oman, one may get the Class III license to operate private telecommunications company (TRA, 2018). The Ooredoo Oman telecommunications company requires this license for its operations since it is a privately owned company. Companies must meet the qualifying criteria to get the class III license as pre-determined by the TRA. The permit, however, lasts for five years maximally. Before applying for this license, it is important to first consult with the TRA regarding the service offerings. Notably, the TRA has complete jurisdiction over the telecommunications industry. However, the authority works with the Ministry of Transport and communications to approve any license applications (Jones, Uthmeyer, Allen, & Holley, 2017).

The Oman telecommunications industry is subjected to the Royal Decree of 2002, which was the promulgation of the Telecommunications Registration Law and other amendments (Ameen and Willis, 2016). Other laws include the Ministerial Resolution of 2007, which stipulates the issuance of the necessary technical specifications as well as the approval of telecom equipment used by telecommunication companies (Jones et al., 2017). Other aspects such as the Domain names and the universal service implementation can be established upon consultations with TRA. Since TRA is an independent body, its approval of licenses is based on the competencies of the firm solely (Sarrayrih and Sriram, 2015). The company should show the willingness and intention of providing consumers with reasonably priced services. In case a company does not get the approval to acquire a license, it may apply within a month to get consideration once again from the TRA (Jones et al., 2017).

For telecommunication companies to ensure their continued operations, they must reapply for the renewal of their licenses once it expires. Additionally, companies must pay a certain amount of the license fee. Other than that, it often considered being a tax-free jurisdiction, with taxes mostly applying to corporations (Jones et al., 2017). The law also provides no restrictions to interconnection. However, parties may involve TRA if they do not agree on the issues within a three-month period (Omantel, 2017). Acting in the welfare of stakeholders, TRA, through the Omani Consumer Rights Law, requires companies to provide consumers with the right information when purchasing the services and products. Additionally, requirements involve the provision of after-sale services, price and the characteristics of the services for consumers to make informed decisions.

Econet Wireless, Burundi

An overview of the company

Burundi has a very high population density as well as notably low penetration rates in the telecommunications sector. The high population density makes the telecommunications industry one of the most attractive investment opportunities in Africa. Despite being an attractive market, there is a low willingness among the investors to invest in the country due to its poor economic output. Additionally, the infrastructure remains poor. However, the government of Burundi, with the help of the World Bank, has committed itself to build a national fiber network that will ensure that all people are connected. Since 2014, the fiber network links various locations, with the domestic connectively being expected to be completed by 2025 (Fortune of Africa, 2018).

Currently, one of the leading telecommunications company in the country is the Econet Wireless, which supplies customers with a wide range of products and services such as broadband, fibre, and mobile services. The company founded in 1993, is a privately owned company with revenues of up to 3 billion American dollars (Fortune of Africa, 2018). By the time the company acquired its license to operate, more than 80% of the population had no access to mobile phones. The fact that people had no access to mobile phones provided an ideal opportunity for the company to win over a significant share of the market ahead of the competition. The company is not currently listed in any stock market.

Operating in the Burundi Telecommunications industry

The Burundi Telecommunication industry is subjected to six significant laws. The first is the Decree N 100/112, which is responsible for regulating any form of mobile or electronic communication services that require the use of wireless mobile devices. This law also sets the framework for the industry whereby any company that intends to offer such services must adhere to the framework set. The second law is the Decree N100/182, which was passed in September 1997. This law is responsible for the establishment of the ARTC, which then offers technical advice for entities in the industry. The third law is the Ministerial Order N 520/730/540/231, which was established in April 1999 (Rubenya & Guthfreund-Roland, 2017). Through this law, it is possible to determine the necessary conditions for one to operate in the industry. If one does not meet the requirements stipulated in this law, then it becomes impossible to acquire an operating license. The fourth law governing companies in this industry is the Decree N 100/47 established in November 2010. Under this law, the ARTC is placed under the president's supervision, ensuring that the authority is answerable to a higher power. The crucial fifth law is the April 2014 Decree N 100/97 that offers an overview of the necessary conditions for a company to operate in the electronic division of the communications sector. Finally, the Decree N 100/112 of 2012 re-organizes and explains the functions of the ARTC, which is the overarching authority in charge of monitoring the Burundi telecommunications industry (Rubenya & Guthfreund-Roland, 2017).

Under the ARTCS, the government ensures that there are fair conditions for competition while providing that no single company abuses its power and position in the industry. The authority also follows any technological developments to ensure that the industry keeps up with the changes across the world. Additionally, the body also reviews the actions of companies to ensure that they do not engage in activities that falsify competition in the industry. The laws governing the telecommunications industry apply to any company or enti...

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Overview and Management of Ooredoo Oman and Econet Wireless Burundi. (2022, May 26). Retrieved from https://proessays.net/essays/overview-and-management-of-ooredoo-oman-and-econet-wireless-burundi

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