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U N I T E D A R A B E M I R AT E S Y E A R B O O K 2 0 0 8

DU

As already outlined, in the interests of competition a political decision was made to open up the telecommunications market. Emirates Integrated Telecommunications Company or du was subsequently formed with a paid-up capital of US$1.1 billion, offering voice, data and entertainment on mobile networks and converged broadband, TV, and landline.

In January 2006 the takeover of the Tecom telecommunications company that formerly operated Dubai free zone networks, and Emaar's former Sahm Telecom network gave du a good working base to develop the company.

Prior to an IPO in 2006, 50 per cent of du was owned by the UAE Government, and the remaining 50 per cent split equally between Abu Dhabi's Mubadala Development Company and Emirates Communications Technology Company. Post-IPO up to 20 per cent of the company can be controlled by foreign individuals and institutions permitted to purchase du shares on the Dubai Financial Market.

du has made a significant investment in building infrastructure and operational capabilities as well as recruiting and developing staff, amassing nearly 250,000 mobile customers in the first six weeks of the launch of its network in February 2007. At this point du covered 80 per cent of the populated areas of the UAE, falling a little short of the 85 per cent required under the telecom licence issued by the TRA. By late November, du had one million mobile phone subscribers and had strengthened its network coverage across the UAE. du also launched its fixed-line network in July, serving Dubai, Abu Dhabi and Sharjah only. However, the company now provides fixed-line services to the whole of the Emirates.

VOIP

At present, Etisalat and du are only permitted to use voice over internet protocol (VoIP) to provide local calls to their subscribers. Computer-to-computer calls are also allowed, but computer-to- phones calls, or vice versa, will not be considered for introduction in the UAE until the TRA has concluded a public consultation process in mid-2008. The consultations will involve the UAE’s

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