Roadmap: The future of Iran’s telecoms market
07 March 2017 | Jason McGee-Abe
The Iranian government has set out clearer obligations for the Ministry of Information and Communications Technology (MICT) as part of a five-year social and economic development plan. Welcome news for the wholesale market, which is looking for clearer regulation after the relaxation of sanctions.
The sleeping giant that is the Iranian telecoms market is truly waking up and the Majlis has introduced legislation which tasks the ministry with increasing capacity in the country to 30Tbps by March 2021.
The ministry will also be tasked with undertaking structural reform of the state-owned Telecommunications Infrastructure Company of Iran (TIC), which is the exclusive provider of bandwidth to local internet companies and operates fixed-line networks which are leased to third-party telcos and internet service providers (ISPs).
The ministry wants to split TIC into three parts, which will operate independently: the International Data Transit Company; Research and Development Company; and Infrastructure Development Company. All three will be overseen by a new entity.
Iran’s parliament has also challenged the ministry to attract investment from the private sector and foreign organisations as Iran looks to expand its telecoms infrastructure. Clearer regulatory rules is welcome news for the wholesale telecoms market, which is seeking clearer regulation to commit foreign direct investment into Iran’s telecoms market. Speaking at Capacity Eurasia last year, representatives agreed that clearer regulation would help boost the growth of the telecoms market in the country.
“The Iranian government has a clear vision in terms of broadband and ICT investment, and the population is gaining much better access to internet and ICT as a result,” said Alessandro Talotta, chairman and CEO of Sparkle, at the event. In September, Sparkle became TIC’s first international Tier-1 IP partner. It signed a deal to expand its Seabone global IP transit backbone in Iran, opening a point of presence (PoP) in Tehran.
Some delegates said a reduction in sanctions meant there is naturally an increasing demand for wholesale providers to partner with local players to not only enter the Iranian market, but to do so smoothly, utilising existing infrastructure in the country which has invested heavily in landline models.
Italian equipment vendor Italtel made a pitch last year to build a nationwide ultra-fast broadband network in Iran and virtualise the country’s broadband telecoms. CEO Stefano Pileri told a conference in Tehran last year: “Italtel is looking to contribute to the development of Iran through technology and innovative solutions. Transforming existing networks and installing ultra-fast wideband infrastructures needs to be a top priority to ensure that people living in Iran truly benefit from internet technology and vital services can be developed.”
Italtel said it intends to use its experience in delivering international projects for network transformation from TDM to IP.”
Reports in November claimed a consortium of Iranian companies was looking to enter the Syrian market, to compete with MTN group and locally-owned SyriaTel. Reuters claimed that the Syrian government will allow its Iranian counterpart to become a mobile service operator and launch services in Syria as it looks to enhance economic ties between the two countries. In early January, Iranian ISP Shatel had complained that state-backed incumbent TIC was blocking its voice over IP services, introduced in December 2016, from connecting with regular PSTN landlines. A complaint had been filed with the Communications Regulatory Authority (CRA) over TIC’s alleged failure to interconnect its VoIP calls, but a week later the MICT intervened and TIC subsequently agreed to connect Shatel calls.
Closing in on the deal
South African-owned MTN group, already an existing shareholder in MTN Irancell, is believed to be closing in on a deal to acquire a 49% stake in state-owned Iranian ISP Iranian Net. MTN Irancell has commenced marketing LTE-A technology, having carried out LTE-A trials using two carriers in the 1,800MHz band and achieving peak download speeds of a reported 1.2Gbps.
Domestically, the National Information Network (NIN), which hosts only Islamic-approved content, is nearing its full rollout. Capacity on the NIN will reach 10Tbps after the final phase, Talash 3, of the project is completed. The network is meant to provide a high-capacity, low-latency connection for Iranian users, on a nationwide fibre backbone network.
Iran is also looking heavily into the potential of the internet of things, and Iran’s ICT minister, Mahmoud Vaezi, announced in mid-February that a committee within the ministry has been working on the IoT development over the last two years, revealing that a pilot project is presently operational in Tehran.
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