CAIRO: Telecom companies from Egypt, Italy, India, Saudi Arabia and the United Arab Emirates plan to build a submarine cable linking Europe to India through the Middle East, Telecom Egypt said on Monday. State-controlled Telecom Egypt has signed a memorandum of understanding on the project with Etisalat of the UAE, Saudi Telecom, Telecom Italia Sparkle and VSNL of India, it said in a statement.
Telecom Italia Sparkle is a unit of Telecom Italia SpA. The project will provide interconnection facilities with several existing and emerging systems in the region. The network is set to cut over in fewer than two years, with construction contracts for the system likely to be awarded this year. The cable will use dense wavelength division multiplexing and would have a design capacity of at least 2,560 gigabits a second, it said. The parties expect to award construction contracts for the project by the end of 2006 and the target for having the cable ready for service is the middle of 2008, it added. The Al-Ahram daily said in September that the cable would cost a total of $520 million (about LE 3 billion) and the Egyptian government has issued a license for it.
In addition to announcing the undersea cable project, the operator also boosted its position in Egypt s mobile market by increasing its stake in Vodafone Egypt to 48.97 percent as the result of a tender offer announced in September.
It had a 25.5-percent stake, and it is spending a tad more than $1 billion (LE 5.74 billion) to buy the shares from the Alkan Group (which held 5 percent), Banque du Caire (3.4 percent) and a number of individual shareholders. The Vodafone Group retains control with a 50.1-percent stake in the Egyptian operation. Vodafone Egypt has seen particularly strong growth during the last 12 months. In July, it announced its active customer base had increased by more than 65 percent compared with June 2005, to 6.9 million.
TE is the dominant player in the Egyptian telecom market. At the end of June, it had more than 10.6 million fixed-line customers. However, broadband penetration still is quite low in Egypt. At the end of June, TE had fewer than 50,000 broadband subscribers.