Telecom Egypt expects to start using submarine cable this summer

Telecom Egypt, a monopoly fixed-line operator, expects to start using its new submarine cable to Europe this summer.
The telco forecasts that the cable, called TE North, will add between £E700m ($124.8m) and £E800m to its revenues this calendar…

Telecom Egypt, a monopoly fixed-line operator, expects to start using its new submarine cable to Europe this summer.

The telco forecasts that the cable, called TE North, will add between £E700m ($124.8m) and £E800m to its revenues this calendar year.

The company will use TE North to provide faster internet connections and bandwidth at a lower cost, said Tarek Tantawy, the company’s chief executive officer.

“The trend going forward is for more bandwidth-intensive applications,” he said.

Telecom Egypt relies on its sales from providing wholesale services, such as bandwidth, to counteract falling revenues from its fixed-line business which has been hit by increasing competition from Egypt’s three mobile phone operators.

The wholesale business accounted for £E1.2bn, or 48%, of total revenues of £E2.5bn in the first three months of 2010. Wholesale services generated 14% more revenues than they did in the first quarter of 2009.

The retail business produced £E1.3bn of revenues, down 12% on the same period a year earlier.

Tantawy also said that Telecom Egypt planned to become the country’s fourth mobile phone operator, even though the Egyptian telecoms regulator has yet to declare whether it will license a new entrant. Tantawy failed to give any details of how Telecom Egypt would enter the market.

The company said that its 45% stake in Vodafone Egypt – the country’s second-largest mobile phone operator – contributed £E300m of net profits in the first quarter.

Vodafone’s UK-based parent will disclose full financial results on May 18