M&A on the agenda

Orascom chairman Naguib Sawiris presented one of the more enlivening sessions at Congress as he outlined his thoughts on the future shape of the industry. He predicted a period of operator consolidation and suggested that no more than 10-12 global operator groups will be the result, bringing the community closer to the number of vendors. He also expressed his view that a lack of unification was holding the industry back, which he blamed on operators previously "making money too easily" and that operators now "need more than a good looking girl" to sell their services. He also expressed his strong support for the Wholesale Application Community initiative announced on the eve of the Congress and said that majority - rather than unanimous - agreements are required on industry initiatives or they will take over 20 years to agree, as was the case for the universal charger.

Sawiris painted a bleak picture for single market and mid-sized operators, which he believes will struggle to compete with the efficiencies of scale available to the likes of Vodafone. Personally, he stated that he was not looking to looking to sell Orascom but rather was looking to join the big league of global players. However, he expressed his desire to maintain control and referred to the proposed 50/50 Orange/T-Mobile merger in the UK as a "model for failure" as it would be "like a ship with two captains." Doing his best audition for Stephen Fry's gig at the GSMA Awards Party, he proclaimed that he has doesn't have any great affinity to telecoms but "likes making money." Etisalat Chairman Mohammed Omran also expected M&A activity in the coming year and nominated six MENA markets that the group is actively examining. In India, he expected there to be no more than six nationwide operators within three years with Etisalat aiming to be an acquirer. He also highlighted the announcement during Congress of Bharti's US$10.7 billion bid for Zain's African assets as a sign of things to come.

(This article is part of a series of follow-ups on Mobile World Congress 2010 from the GSMA Intelligence team.)