Per its recently published quarterly results, du, a Dubai-based integrated telecom services provider, reported an increase of 156,000 new subscribers (giving it a total of 2.9 million active mobile customers), in addition to a 12% increase in revenues on the previous quarter and a greater than doubling of profits. With an estimated 30% of the UAE’s mobile market, du is competing chiefly with Etisalat, which presently reports 7.26 million subscribers (though it just disclosed a loss of around 80,000 customers over the past three months). According to its chairman Osman Sultan, du hopes to gain an addition 5% market share over the next year, as well as grow usage of mobile broadband on its network–i.e. the BlackBerry mobile e-mail handset and also the launch of Apple’s iPhone.

Once considered the mere low-cost, low-quality network compared with Etisalat, du’s surging customer base is testament to the brand’s perceived value, as well as its growing competitiveness in a market where the cost of a new mobile line today is a third of what it was a year ago, and mobile data rates and fixed-line internet costs continue to fall as well. However, some analysts wonder whether the company’s edge will disappear once protection originally granted to it (in order to shepherd in competition) from the UAE’s Telecommunications Regulatory Authority (TRA) subsides, and/or a third operator joins the fray? For instance, reports allege that Etisalat has previously complained that it would like to lower some prices, but has not been given regulatory permission.

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