BAGHDAD, 27 July 2003 — The US-led authority in Iraq has asked a Bahraini firm to stop supplying cellular service, jeopardizing Baghdad’s first experience with mobile phones, banned under ousted President Saddam Hussein.
A renegade service provider could throw a wrench into US plans for a tender next week for three mobile phone licenses it plans to offer across Iraq.
Mobile phones unexpectedly sprang to life in the Iraqi capital this week, allowing cellular users to make and receive calls around the world. Within days, mobiles replaced pricey satellite phones as a major means of communicating abroad — at least for foreign journalists and businessmen. Few Iraqis have suitable phones. “We have asked them to turn it off,” a spokeswoman for the Coalition Provisional Authority (CPA) told Reuters yesterday. “They are not licensed to do that.”
The cellular licenses are among the most potentially lucrative contracts to be offered in Iraq, where mobile phones were banned to all but senior officials connected to a special network while Saddam was in power.
The service provider, Batelco, told Reuters it had already spent $5 million on infrastructure in Baghdad, was offering prepaid cards, and did not want to stop.
Batelco, partly owned by the Bahraini government, said it asked the US-led administration for a license and planned to invest over $50 million in Iraq. It said it would ask to continue operating at least until a tender is sorted out.
Regional Operations Manager Rashid Al-Snan said Batelco had initially installed its network without a license because “there was no licensing authority”.
“We don’t want to create enemies...We are here to help,” Snan said. “There is a huge demand for the service. We would like the opportunity to continue to work.”
The CPA spokeswoman said she expected the Bahraini roaming service, which is shaky and occasionally disappears for stretches of time, would stop “soon”.
She could not say exactly when licensed mobile service might arrive in Baghdad, where roughly half of land lines remain out of service more than three months into the US-led military occupation. But she said it should be “weeks rather than months”. The CPA invited expressions of interest last week and plans to request license proposals next week. They would be due 14 days later.
Asked if Batelco would be barred from the tender or treated unfavorably if it continued to provide service, she said: “It’s an open competition”. A spokesman had earlier said the tender would be decided “purely on the basis of value for money”.
An official for MTC-Vodafone in Kuwait, whose roaming service appeared briefly this week before vanishing, said his firm began work in Iraq two months ago to reinforce service for the US and British armed forces.
“It’s a limited service and I have no information on its use by the public,” he told Reuters, adding that MTC-Vodafone would participate in a telecoms tender conference in Amman next week.
Rival Kuwaiti Wataniya Telecom said it was also interested in the tender and would participate in the conference.
The US Army and development workers now use a network in Baghdad built by WorldCom Inc., a bankrupt US telecoms firm that is doing business under the name MCI — but service is barred to ordinary Iraqis. Iraq has not yet decided whether to use US technology or the rival, more widespread European GSM system that is used throughout the rest of the Middle East.
A decision to use the global system for mobile communications standard (GSM) would be a blow to US firms hoping to build a wireless network in Iraq based on the CDMA (code division multiple access) standard developed by California-based Qualcomm Inc. GSM technology would allow Iraqi cellphone users to travel to neighboring countries without changing phones.
