Jordan Telecom on the road to expansion

The new tie-up will see the roll-out of a range of new services in Bahrain, including bundled broadband packages aimed at the residential market, small and medium sized enterprises as well as the corporate sector. Mickael Ghossein, the Chief Executive Officer of the JTG, and now also the new Chairman of the Board of Directors of Lightspeed Communications, said the deal fitted the JTG's own expansion plans and also gave its strategic partner France Telecom a 'springboard into the region'.

Lightspeed and heavyweight

Lightspeed's decision to sell a majority holding to Jordan Telecom certainly looks to make sense as it vies to compete in the currently Batelco dominated Bahraini marketplace. The firm is set to launch a number of innovative products in the future, including a Triple Play service offering an integrated IP telephony, video telephony, IPTV and video-on-demand solution that can utilise any type of broadband IP infrastructure. To have the backing of a sizeable regional entity, with more than 2.3 million subscribers across its various services, will give Lightspeed's products every chance of increased reach.

Indeed, early last year, Jordan Telecom integrated its fixed, mobile, Internet, content and wholesale activities into one organisation, with a single management structure. Ghossein believes the restructuring has put the JTG on a firmer footing and the group is not only confident of making an impact in Bahrain's liberalised telecommunications market but is open to further expansion elsewhere in the Middle East.

Behind the JTG, of course, there is France Telecom, with its 51 per cent controlling stake and its own ambitions to gain ever more penetration in the Middle East and North Africa. The firm already counts 12 million customers across Jordan, and also Egypt, and Marc Rennard, France Telecom's Executive Director for International Business, Africa, the Middle East and Asia sees the Lightspeed deal as offering much potential, saying, 'Thanks to this new partnership with Lightspeed Communications, Jordan Telecom Group, our subsidiary in Jordan, will be able to position itself in new highly promising and highly profitable markets, making all of the France Telecom Group's know-how available to its new clients, with their enthusiasm for new technologies.'

Making progress in Jordan

But while the JTG is looking at branching out into new territories, Jordan's own Internet sector offers much in the way of potential. The JTG's Internet and data business unit, Wanadoo, boasts more than 50 per cent of the market share in the kingdom but penetration levels still have a long way to go.

At the end of last year, when the JTG released its rather mixed financial returns, the firm revealed that its fixed line services now had 677,100 subscribers, while MobileCom, its mobile division, had 1.4 million customers. In fairly stark contrast to these figures, Wanadoo had accrued a mere 38,600 subscribers and yet this amounted to a very impressive increase of almost 40 per cent on the previous year.

The JTG is well aware that penetration levels in the kingdom could improve and, this very month, it has launched a promotion offering free broadband installation - something rival ISPs in the country, such as Batelco Jordan, are also more than happy to provide. But while the figures for Internet take-up seem low when set against mobile phone usage, a segment that has seen huge growth right across the region, Jordan has nevertheless seen its number of Internet users grow by 400 per cent over the past five years.

One of the key barriers to more people opting to subscribe to Internet services in the kingdom, as elsewhere, is the prohibitive cost of hardware and, equally, the packages offered by the various ISPs. If the JTG can look to make further reductions to the price of its packages and continue its promotional drives, then the revenue from its Internet business will increase rapidly.