CAIRO: Egyptian telecoms regulators have told mobile operator Mobinil it must either stop using EDGE technology that allows users to see streaming video or apply for a 3G license, Mobinil said on Tuesday.
Mobinil, which has deferred a decision to apply for a license for higher-bandwidth 3G technology for a year citing unattractive terms, said discussions were ongoing to resolve the dispute. A 3G license would cost about LE 3.3 billion.
The [National Telecom Regulatory Authority] has requested that Mobinil stop offering enhanced data services on EDGE, based on an understanding that it is a 3G technology which requires licensing, a Mobinil spokesman said.
Discussions are underway between the two parties about this, the Mobinil spokesman added in a written response to a Reuters query.
But Mobinil, which is majority-owned by regional operator Orascom telecom, said it had an understanding with the government that it could continue to use EDGE so long as discussions were ongoing.
Mobinil started EDGE trials in Egypt early in 2006, and its services are now offered in major cities and airports. EDGE can allow for transmission of non-voice data calls three to five times faster than GPRS.
Mobinil maintains the position that EDGE is an enhanced version of GPRS and that both are second-generation technologies that do not require further licensing, the spokesman said.
Officials at the NTRA could not be immediately reached for comment.
Egypt s two existing mobile operators are Mobinil and Vodafone Egypt, and they would have to pay approximately LE 3.3 billion for 3G licenses because the price for the license is linked to the unexpectedly high winning bid for the country s third mobile phone operator.
The third mobile license was sold at auction last month to Etisalat of the United Arab Emirates for LE 16.7 billion.
The resulting price that the existing operators would have to pay for 3G prompted Egyptian investment bank EFG-Hermes to lower its long-term fair value share price estimates for the two companies to LE 202.30 for Mobinil and LE 110.40 for Vodafone.
Shares in Mobinil, which reported first-half net income of LE 657 million in late July, ended on Tuesday at LE 138.51.
Mobinil rival Vodafone has said it was evaluating whether to buy a 3G license, and was discussing the terms with regulators. Reuters