Iraq shuns US to choose European mobiles standard

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Iraq has awarded three two-year mobile phone network licences based on the GSM standard - a move that snubs the rival US technology - as it rebuilds its infrastructure.

The country did not have a public mobile phone network during Saddam Hussein's rule and the new contracts are expected to prove one of the most lucrative in post-Saddam Iraq.

The mobile networks will be based on GSM, short for global system for mobile communication, which is the system used in Europe, the Middle East and many other parts of the world, rather than the US rival system called CDMA.

The Coalition Provisional Authority awarded licences in three regions. In Northern Iraq, the licence went to Asia Cell Telecommunications in which Kuwait's Wataniya Telecom has an interest. In Central Iraq and Baghdad the licence went to a consortium led by Egypt's Orascom Telecom, while a group led by Kuwait's MTC was awarded the licence for the South.

All three consortia include Iraqi companies. Orascom Telecom said yesterday it had secured financing for the majority of the estimated $100m spending. MTC said its group planned to invest up to $120m.

Iraq's Communications Minister Haidar al-Ebadi said: "Until now, we were denied mobile phones. Iraqis will welcome the chance to use mobile phones to talk to their family, friends and for business purposes."

The GSM system is used by nearly 1 billion people around the world, including more than 40 million people in countries bordering Iraq. Craig Ehrlich, the chairman of the GSM Association, said: "GSM will help re-integrate Iraq internally, with its neighbours, the region and the rest of the world."

One of the terms of the licences is that network deployment must commence within 20 days of licences being issued - a factor that helped GSM win over CDMA.

The GSM Association said: "GSM can be deployed and become operational faster than any other mobile technology.... Furthermore, the worldwide GSM market has ensured that an enormous choice of infrastructure and handsets is readily available at competitive prices."

Mr Ebadi said he hoped mobile phone services would start "within a few weeks" and possibly by the end of the month.