Iraq: Enhancing connectivity

Political instability in the country threatens investments on telecoms infrastructure
Asiacell, BMI, Buddecom, Country profile, Iraq, Satellites, Telecoms, World bank, Zain Iraq


The telecoms infrastructure in Iraq is representative of an embattled country that has seen decades of conflict, overall it is the fixed networks which have suffered as a result of all the upheaval.

“From civil war; to regional wars with Iran; deployment of US and coalition troops and strict UN sanctions. At times there have been attempts to rebuild the telecoms infrastructure but with the unrest in Iraq intensifying again,” said Kylie Wansink, analyst at BuddeComm.

“Iraq has one of the lowest fixed-line and broadband penetration rates in the region, at 5.6% and 0.5%respectively at the end of 2013 and we do not expect the situation to improve significantly through to 2018,” said BMI research.

In contrast, mobile technology has prospered and nearly all citizens have cellular devices. According to a research published by BuddeComm, one bright spot for future progress in this war-ravaged country is the mobile market, as mobile operators are offering 3G services in Iraq now.

Zain Iraq and Asiacell turned on their 3G network achieving a commercial 3G launch in the country. Asiacell invested $1 billion cash, which included system modernisation and licence fees. In November 2014, Asiacell paid $307 million for a 2100MHz 3G licence.

Faruk Mustafa Rasool, chairman at Asiacell, commented: "Iraq has been underserved for far too long, it’s time to bring 21st century wireless service to this important economic hub in the world".

However, operators are experiencing some problems after rolling out the services, as customers are reporting interference problems when using 3G.

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According to Asiacell, one local carrier operates in the low frequency band, while a second occupies spectrum in a high frequency band. Both occupy airspace close to Asiacell’s high and low frequency bands. Complicating the issue is the fact that a majority of the region’s population is concentrated in a few densely populated areas. As a result, the three carriers often operate in close physical proximity to one another, with many instances of co-location.

The 10 MHz in the 2.1GHz band was allocated for 3G services; however, a total of 21.5 MHz is allocated in the 900 and 1800MHz bands for 2G services, explained Zain.

“There are several operators working in Iraq and the challenge is that the frequency band is really close, which makes some interference coming to the frequencies. We are witnessing this problem especially through the 3G band,” said MohammedBaban, CTO of AsiaCell, to CommsMEA.

“The 3G license has defined the spectrum range for each operator, however operators and regulators are meeting to avoid using unclean parts of the spectrum. The regulators restricted 3G services to be offered on 2.1GHZ band only for the time being. A more relaxed policy for using the spectrum might be beneficial to all parties,” said Philipe Hanna, chief commercial officer of Zain Iraq, about the interference problems.

“We are already taking with the regulator but, due to our country situation and the conflict and the security issue, we couldn’t focus in this topic. There are too many factors affecting decision, but I think it is too late to solve it now,” Baban said regarding the low and high frequency bands that operators are using to deliver their services.

The GSMA has also encouraged governments, telecommunications regulators and the industry to discuss spectrum harmonisation, which is a major objective of the International Telecommunications Union (ITU). Hanna said that a less restrictive approach by the regulator, the Communications and Media Commission (CMC) of Iraq, will encourage operators to utilise the spectrum efficiently.

Despite these challenges, Hanna believes that 3G technology open doors for variety of services and enhancement to the quality of communication services. “It provides better and faster access to Internet. The benefits to Iraq will be influenced by 3G service penetration in the country. It is well accepted that Broadband services positively influence GDP and open new employment opportunities. A 10% growth in broadband service penetration might add 1-1.4 pp increase in GDP, according to the World Bank,” he said.

In Iraq, companies are aware of the security issues that they need to face due to IS, Baban commented that the security issues that operators are facing are linked to maintaining network operations, billing, losses due to hostility, as they suffer equipment damages, shutdown of network which translates in loss of revenue, and also the delay of network expansion and upgrades.

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