Egypt's Egyptian Company for Mobile Services (Mobinil) says that it does not expect to make a profit from its 3G network - and would not have brought the license had it not included an extension to the existing GSM license held by the firm.

“If it were the 3G license only, definitely it would never have proven to be profitable,” Guillaume Van Gaver told Reuters on the sidelines of a telecoms conference.

The company has only launched its 3G network following several delays, which the company partially put at the door of the telecoms regulator. The company had expected to receive access to the radio spectrum on 17th January, but the radio frequencies were not released until March 27th. The company had hoped to launch its network in July, but again missed its deadline.

Mobinil did not just add a 3G overlay to its exiting GSM network though - but says that it built an entire new mobile network. The last few months have witnessed an incredible effort to increase the number of base stations installed hiking it to more than 6,500 base stations, out of which 700 3G base stations and more than 2,100 EDGE-enabled base stations to offer wider coverage for all populated areas in Egypt.

The company managed to negotiate a four year payment term for its US$600 million 3G license as part of the compensation for the delays.

Mobinil is listed on the Cairo stock exchange (29%) - and has two main shareholders, Orascom Telecom (33.1%) and France Telecom (36.3%). The company is the largest operator in the market, and according to figures from the Mobile World database, ended Q1 '08 with just over 16.3 million subscribers and a market share of 48.2%.

Source: Mobile World - Mobinil - Daily Star Egypt