Independent report calls for measures to improve competition in the internet market

In August 2007 TRA commissioned a consultancy firm to assess the case for promoting more access based competition in the internet market through the possible introduction of local loop unbundling (LLU). LLU allows internet service providers (ISPs) to gain direct access to a customer's fixed line, giving them greater flexibility to provide a range of internet services and speeds.

The Consultants held discussions with the main operators, service providers and representatives of the business community, and visited representative sites within Batelco's network.
The principal findings of the study were that if the Government is to succeed in turning Bahrain into a service based economy, which is competitive on world markets, then it will need to develop a competitive telecommunications industry which delivers high-speed broadband services at economically efficient prices.

Further, it found that Bahrain is comparable with other Middle Eastern states in terms of broadband take-up. But its performance is not satisfactory if judged in a global context. Speeds and take up are low, and prices, especially for higher speed business broadband are above what would be expected in a competitive market.

The study concluded that, at least in the short term, infrastructure competition from alternative network providers such as fixed wireless licensees is unlikely, on its own, to result in a fully competitive broadband market.

Based on the conclusions of the Study TRA has decided to take a 'wait and see' approach to the introduction of LLU in Bahrain and will further assess the situation with the release of its final recommendations of the Strategic and Retail Market Review in March 2008. However, the Study also concluded that there was a need to make current internet wholesale products offered by Batelco more 'fit for purpose' particularly in relation to speeds and technical parameters. TRA considers this conclusion to be timely with the upcoming review of Batelco's Reference Offer set to begin in December.

Commenting on the results of the study, Mr. Alan Horne, General Director of TRA said: "TRA is fully aware of the benefits that a competitive internet market can bring to Bahraini consumers. With this in mind, TRA agrees with the Report for the need to build on the current wholesale internet products offered by Batelco in order to allow further development of access based competition. TRA believes that this along with, competition which is likely to develop from the national fixed wireless licensees will lead to more choice and lower prices for broadband products in Bahrain".