New consultation launched on remaining 3G licences

TIRANA, June 18 – Albania’s Electronic and Postal Communications Authority (AKEP) says it has launched consultations on the two remaining 3G licences after a tender to award a third licence in early 2012 failed because of very low bids. The Authority says it is negotiating with the Turkish-owned Eagle Mobile and Albania’s Plus Communication on whether the two licences will be issued at the same time and how much the two companies are willing to pay. The Innovation and IT Ministry and AKEP are expected to decide on whether they will hold another tender and what the price tag will be after the public consultation closes next July. However, the companies’ inability to meet the required price tag could also be opposed by the two companies currently offering the 3G service Vodafone Albania and AMC.
In a tender organized by AKEP last February, Turkish-owned Eagle Mobile offered only 3.5 million Euros while Albanian-owned Plus Communication 2.2 million Euros, bids which automatically disqualified them from this 3G race, making the full liberalization of the 3G market impossible in the near future. The tender’s failure was an expected result after both remaining companies had described the price tag for the third 3G permit as unaffordable for them and called for the two remaining licences to be granted in parallel at a lower price tag.
Speaking to reporters after bids were submitted in early 2012, AKEP director Pirro Xhixho said “We consider the 12.5 million Euro price not to be expensive. Albania is a dynamic country and the third 3G licence is being granted in a short time and must preserve this price tag. We consider the tender and competition fulfilled because currently there are two operators offering the 3G service and for the remaining operators it’s up to them whether they want to provide this service or not.”
Earlier this year, Eagle Mobile, which submitted bids in the tenders for the first and second 3G tenders, described the unchanged 12.5 million Euro price tag as too high.
“What we see right now is not the case. The market is shrinking. In a shrinking market the prices are going down and 12.5 million Euro is a little bit too high,” said Orhan Coskun, General Director of ALBtelecom and Eagle Mobile.
Meanwhile, Plus Communication, the only 100 percent Albanian owned mobile company, had called on government authorities to grant two licences in parallel at a lower price as a step to
The new 3G tender comes soon after AMC won the second 3G licence and one year after Vodafone Albania became the first operator to offer the service.
AMC, part of Greece’s Cosmote, was awarded the 3G licence in October 2011 after offering 15.1 million euros, 2.6 million more than the price tag government had set. Vodafone Albania won the first 15-year licence after offering 31.4 million euros in November 2010,
According to the latest AKEP data, the number of mobile subscribers in 2011 rose to 5.2 million for a population of around 3 million, a figure which shows more than 1/2 of subscribers have at least two SIM cards.
Currently four companies, AMC, Vodafone Albania, Eagle Mobile and Plus Communication operate in the Albanian market. Increased competition and interventions by the Electronic and Postal Communications Authority have considerably lowered mobile tariffs during the past 3 years in Albania, but still remain above the average in the region.