Batelco chief says market has reached saturation point

5 Jul 2010

The CEO of Batelco’s Bahraini operations, Gert Rieder, has told Arabian Business that he believes the country’s telecoms market is at saturation point. ‘There have been more than 100 licences given out for fixed, mobile and internet services in Bahrain, which is far too many. A lot of the players are struggling to get economies of scale – or any kind of scale in the first place,’ said Rieder. ‘If you look at the fixed market, we’re talking about 200,000 households and 200,000 broadband connections. You cannot have a sustainable business if you only have around 4,000 customers.’ According to TeleGeography’s GlobalComms Database, wireless penetration in Bahrain is in the order of 200%, and Rieder says that the award in March 2009 of a mobile concession to Saudi Telecom Company was unnecessary. ‘The business case of the third operator – looking at their investments – I think they will have a very tough time ever breaking even. Definitely the two-player scenario would have been my preferred option, but the regulator wanted to offer a third licence, and we didn’t need it, to be honest.’

Bahrain, Bahrain Telecommunications Company (Batelco)