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Bahrain's three mobile phone operators, Batelco, Zain, and Viva, are engaged in a serious competition to win the hearts and minds of Bahraini subscribers thanks to the open market policies imposed by the country's regulatory authority.

A protester uses a mobile device to take a video of an anti-government protest in the capital Manama December 17, 2012. REUTERS/Hamad I Mohammed


As a quickly-growing economy with high living standards and a business ecosystem conducive to all sorts of enterprises, Bahrain has become an important trade center in the GCC area.

With the vision of becoming a post-oil economy and to achieve true economic diversification, Bahrain's policy makers have been redirecting the country's oil revenues to other areas, including ICT, thus strengthening the island nation's infrastructure.

The national demand for a world-class telecom industry is also supported by Bahrain's Economic Vision 2030, launched by His Majesty King Hamad bin Isa Al Khalifa, that states that, by 2030, Bahrain's utilities and services, including telecommunications, “will be readily accessible and competitively priced, providing a stable base for businesses."

The primary body in charge of bringing about competitiveness in Bahrain's telecom sector is the telecommunications regulatory authority (TRA) which was established in 2002. Since its early days, TRA has been trying to strike a balance between regulation and competition in the country's relatively small but profitable telecoms sector, which generated more than USD1.15 in revenues in 2016.

Accounting for over 40% of the turnover in Bahrain's telecom market, mobile phone services seem to be the main money spinner in the sector. Nevertheless, with a total subscription of 2.67 million and a staggering penetration rate of 184% at the end of 2017, the market for mobile phone services seems to be oversaturated.

Indeed, quarterly statistics released by RTA indicate that the penetration rate has reached its climax, and sales of both prepaid and postpaid subscriptions is taking a nosedive.

A saturated market is quite often—at least for the consumers—a blessing in disguise as it paves the way for competition as long as the regulatory bodies take the necessary steps to prevent antitrust activities such as forming monopolies or oligopolies. The good news is that Bahrain's RTA seem to be on the right track in this regard.

Batelco, which was founded in 1981 and has been providing mobile phone services in Bahrain since 1990, remained the nation's only operator for over two decades, until TRA put an end to its monopoly in 2003 by granting a license to MTC Vodafone—currently operating under the name Zain. Although Batelco had served Bahrain's telecoms industry well, especially in terms of localizing cutting edge technologies, the breakup of its monopoly resulted in more competitiveness in the market, leading to changes in favor of the users.

Any possibility of the formation of an oligopoly was largely preempted when, in 2009, Viva Bahrain won a bid worth USD213 million and was formally announced as the country's third mobile operator. This led not only to more reasonable pricing of services but also to the betterment of quality.

According to a quality of service report (QoS) published by RTA in 2017, the quality of voice calls and mobile internet in Bahrain is on par with the services available in EU states and, in many cases, even superior.

As in most countries in the world, the consumption patterns of mobile phone users are changing in Bahrain. Between 1Q2017 and 1Q2018 alone there was a 20% drop in the overall duration of outgoing voice calls in the country, whereas the demand for mobile data has been skyrocketing.

Bahrain's competitive operators have responded to this demand by raising the average mobile data in their plans from 1 GB before 2016 to 10 GB in 2017.

Another report released by TRA in 2018 on the price benchmarking of telecom services in the country observes that Bahraini operators are offering some of the most inexpensive mobile internet rates in the GCC, particularly for high speed baskets. The report goes on to add that—when all telecom services are taken into account— “Bahrain is the cheapest of the GCC countries," for average aggregate business use.

It is safe to argue that this reasonably fair pricing is a result of the right policies adopted by the RTA which led to the breakup of the monopoly back in 2003.