PRICING STRATEGY HARMS U.S. FIRM IN RADIO TENDER

UNCLAS MUSCAT 000555

SIPDIS

SENSITIVE

STATE FOR EB/CBA (BBEHRENS, DWINSTEAD),NEA/RA, AND NEA/ARPI
USDOC FOR ADVOCACY CTR (CJAMES) AND DEFENSE TRADE ADVOCACY
(DNEWSOM)

E.O. 12958: N/A
TAGS:
SUBJECT: PRICING STRATEGY HARMS U.S. FIRM IN RADIO TENDER

REF: MUSCAT 384

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1. (SBU) On April 5, Econoff discussed the upcoming
nationwide radio system tender with Brigadier Hajji bin Adam
al-Balushi, Director of Communications for the Internal
Security Services (ISS). Al-Balushi confirmed that the ISS
has invited only Motorola, Thales (France),and Rhode and
Schwartz (Germany) to bid on the tender. He noted that the
ISS has not yet decided on the initial tender's scope, though
he advised that it would most likely cover Muscat to the city
of Buraimi (on the UAE border). Al-Balushi did not expect
the tender to happen as quickly as reftel report, but rather
"sometime this year." He did mention, however, that Motorola
has already submitted a proposal to the project consultant.


2. (SBU) Al-Balushi was skeptical that Motorola would be
price competitive on this tender. He highlighted Motorola's
recent failure to win similar tenders in Dubai, Qatar,
Kuwait, and Iraq as indicative of the probable outcome in
Oman. In light of this track record, al-Balushi suggested
that Motorola review its pricing strategy.
GRAPPO