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* Consortium comprises Vodafone, Zain, du and Zajil.
* Kuwait-to-UAE network to be active in early 2014
* Project cost estimated at $35 million
* Long-term aim is overland connection to Europe
By Matt Smith
DUBAI, Sept 30 (Reuters) - Britain's Vodafone andthree Gulf telecoms companies have formed a consortium to launcha 1,400km fibre network to meet rising demand for broadbandservices in the region.
Vodafone, Kuwait's Zain, du of the UnitedArab Emirates (UAE) and Kuwaiti internet service provider Zajilwill create the Middle East-Europe Terrestrial System (MEETS)with the long-term aim of connecting the network overland toEurope.
MEETS will activate a largely dormant fibre-optic networkbuilt as part of the 1,400km power grid installed by the GulfCooperation Council's (GCC) interconnection authority. Thenetwork runs from Kuwait to Fujairah, an eastern emirate in theUAE on the Gulf of Oman, via Saudi Arabia, Bahrain and Qatar.
The consortium has signed a 15-year rental contract toactivate and manage the fibre network. The GCC InterconnectionAuthority is owned by the six GCC countries.
The network will have estimated capacity of 2,300 gigabytesper second (gbps) and is expected to launch in the first quarterof 2014, the companies said at a news conference in Dubai,adding that the project will cost about $35 million. Total Gulfusage is estimated to be about 500 gbps at present.
"Demand will increase exponentially," said Osman Sultan,chief executive of du.
Smartphone penetration is particularly high in the Gulfregion, where the lack of an efficient fixed fibre network incountries such as Kuwait and Bahrain means that many customersaccess the Internet primarily via mobile devices rather thanthrough a home subscription.
Zain, parent of Saudi Arabia's No.3 operator Zain Saudi, will be the landing party in Saudi Arabia, du in theUAE and Vodafone Qatar in its home market, while Zajilwill cover Kuwait and Bahrain. Vodafone owns a 23 percent stakein its Qatari unit.
The consortium declined to predict when it would begin workon connecting the network to Europe. This phase of the projectwill present more challenges with its likely route via Iraq andTurkey.
Fixed-line internet connectivity in Iraq is expensive,unreliable and limited to a few small areas because of a lack ofbasic infrastructure and deteriorating security.
