New mobile service launched in West Bank

Wataniya Palestine launched its mobile phone service in the West Bank on Sunday even though Israel has yet to release the full range of frequencies agreed for the network, Palestinian officials said.

Mohammad Mustafa, head of the Wataniya Palestine board, said the firm had begun functioning with a frequency range of 3.8 MHz, less than the 4.8 MHz Israel had agreed to open under an agreement with the Palestinian Authority signed last year.

"They will give us the additional 1 MHz as soon as possible," Mustafa told Reuters, adding that Middle East peace envoy Tony Blair had promised the firm it would acquire the remaining frequency.

A spokeswoman for Blair, envoy for an international quartet of Middle East peace makers, had no immediate comment.

The dispute between Israel and the Palestinians has been dragging on for more than two years. Israel controls the airwaves of the West Bank, where 2.5 million Palestinians live.

Wataniya Palestine is owned by Kuwait's National Mobile Telecommunications Co, a unit of Qatar Telecommunications Co and a holding company for Palestinian public assets.

It enters the market alongside a network operated by the Palestine Telecommunications Co (PalTel), until now the sole provider. PalTel, which has about 1.5 million subscribers in the West Bank and Gaza Strip, is majority owned by Kuwait's Mobile Telecommunications Co (Zain).

40,000 users to begin with

Wataniya Palestine had hoped to launch its service by October 15 and had threatened to pull out if it could not have the full 4.8 MHz agreed by Israel. In June, the company demanded its investment back unless the frequencies were opened.

The firm has invested some $270 million on infrastructure in addition to a license fee of $140 million paid to the Palestinian Authority.

Mustafa said Wataniya Palestine would begin operations with 40,000 users who had registered during a promotional campaign launched a month ago. Mashoor Abu Dakka, Palestinian telecommunications minister, said there would be a "long-term battle" for the release of the remaining frequency. "The Israeli side didn't commit to what it had promised. But we wanted the company to become a reality," he said.

Blair had pressed Israel to release the frequencies as a way to jumpstart the Palestinian economy.

The establishment of a second Palestinian mobile phone network has been backed by the World Bank and the US government as part of efforts to boost support for Palestinian President Mahmoud Abbas and his Western-backed government.