TRA Bahrain moots new cost models

The regulator invites responses from operators by June 23 this year.
Dr Al Amer says that the new initiative will help in gaining a better understanding of the cost structure and the cost drivers of services in Bahrain.
Dr Al Amer says that the new initiative will help in gaining a better understanding of the cost structure and the cost drivers of services in Bahrain.

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The Telecommunications Regulatory Authority (TRA) of Bahrain plans to develop a bottom-up fixed access, fixed core and mobile networks cost models in the country.

The regulator recently hosted a presentation with the industry on the bottom-up cost models consultation document which saw representatives from about 10 telecom operators.

The regulator has invited operators to provide their responses to TRA by June 23, 2011.

Dr Mohammed Al Amer, chairman of TRA Bahrain, said: “The development and use of bottom-up cost models will complement existing regulatory instruments in determining the fair and reasonable cost of retail and wholesale telecommunications services in Bahrain. They will also help in gaining a better understanding of the cost structure and the cost drivers of services.

“Having this additional tool in place will help TRA in reviewing wholesale and retail prices to ensure that they meet legal requirements,” he added.

From a regulator’s perspective, the use of bottom-up models allows for greater transparency and enables sensitivity analysis to key variables. Such models can also be useful to assess the cost of new investments such as new fibre deployments or to set cost efficiency targets.

The consultation document with the TRA’s preliminary views on the key features and principles to support the development, implementation and use of bottom-up cost models in Bahrain is available for download on TRA’s website, www.tra.org.bh.

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