Qatar-based Gulf Bridge International (GBI) is completing the final stages of a submarine cable network that will give Iraq fast, reliable connections to other parts of the world for the first time, the network's operator said on Monday.
The network, expected to be fully operational by the end of the year, consists of a 13,000 km (8,078 miles) undersea cable system that will link all six Gulf Cooperation Council (GCC) countries as well as Iran and Iraq, with onward connections to Sicily and India.
Demand for bandwidth is rocketing in the Middle East, driven by the deregulation of regional telecoms markets as well as a desire by governments to diversify from oil and gas into sectors such as finance and media that need fast international connections.
"Nations in the region have seen tremendous growth in the demand for broadband, roughly doubling each year. The demand is very clear. Increased speed and reliability are essential, and will be a catalyst for the development of other sectors of their economies (besides oil and gas)," GBI Chief Executive Officer Ahmed Mekky said in a telephone interview.
"The region needs increased connectivity, as the existing infrastructure isn't enough to meet the demand."
The project , launched in 2008, will be the first cable network to land in Iraq, a country of 30 million people emerging from the 2003 U.S. invasion that followed years of international sanctions under Saddam Hussein, and where still only under 3 percent of the population is connected to the Internet.
The initiative was partly motivated by the multiple cable outages in 2008, which cut off tens of millions of users in the Middle East and India when submarine cables were damaged.
"That supported our case, and increased interest in the project," Mekky said.
The company has invested $500 million in the project so far and is considering an expansion eastward into Singapore, likely in the second or third quarter of 2012, Mekky said, adding that he viewed Iran as another highly promising market.
"Iran is just as hungry for telecom services as any other market in the Middle East. It has a very young population which is growing. Internet use and mobile connectivity are an essential part of life, and we are happy to be able to provide it to them."
The firm's shareholders include regional sovereign wealth funds such as Qatar Investment Authority (QIA), Kuwait Investment Authority (KIA), as well as Qatar Foundation.
Its regional partners include Qatar Telecom (Qtel), Vodafone Qatar, Bahrain Telecommunications (Batelco), Oman Telecommunications Co (Omantel), Dubai's du and Iran's ITC, Mekky said.
The company is also considering an initial public offering in upcoming years, he said.
"We are considering that, maybe in a couple of years," he said.
Reporting by Regan Doherty in Doha, additional reporting by Georgina Prodhan in London, Editing by Sami Aboudi and Andrew Callus