UPDATE ON WATANIYA MOBILE LAUNCH IN THE WEST BANK

C O N F I D E N T I A L JERUSALEM 001795

SIPDIS

NEA FOR FRONT OFFICE; NEA/IPA FOR GOLDBERGER/SACHAR/LENTZ;
EEB/CIP/BA FOR GIBBS; PRM FOR PRM/ANE; NSC FOR PASCUAL;
TREASURY FOR ROSE; PLEASE PASS TO USAID FOR
KUNDER/MCCLOUD/BORODIN

E.O. 12958: DECL: 07/29/2013
TAGS: ECPS ECON BEXP EINV KWBG IS
SUBJECT: UPDATE ON WATANIYA MOBILE LAUNCH IN THE WEST BANK

REF: A. JERUSALEM 1372

B. 2007 JERUSALEM 1921

Classified By: Acting Principal Officer Greg Marchese,
Reasons 1.4 (b) and (d)


1. (C) Summary: Wataniya made its first license payment to
the PA, according to its CEO, who added that the bulk of the
company's network equipment should arrive on October 4. The
company's launch is scheduled for February/March 2009.
Wataniya is still awaiting a GOI network construction license
required for the network equipment's release from Israeli
customs. The company is working with the GOI to facilitate
equipment delivery to the West Bank. End summary.

Wataniya working for a smooth import process
--------------


2. (C) Wataniya Palestine CEO Allan Richardson told Econoff
on September 24 that Wataniya had completed its initial
mobile phone license payment of USD 80 million to the PA
treasury. He said that USD 60 million worth of computers,
antennas, and other technical equipment for the Wataniya
network, including his company's main switch, is scheduled to
arrive at the Tel Aviv airport on October 4 from Sweden.
Richardson confirmed that Wataniya's main switch will be
based in East Jerusalem at the request of the GOI, and that
the network base stations will be fabricated and installed
throughout the West Bank (ref a).


3. (C) Richardson said that he plans to ship the bulk of the
scheduled October 4 shipment to the West Bank soon after its
arrival in Israel. He said he has been working for the GOI's
facilitation of that process. Richardson added that most of
the remaining USD 10-20 million of network equipment will be
purchased locally.

...waiting for GOI permission to import
--------------


4. (C) According to Richardson, GOI customs officials will
not allow the scheduled October 4 shipment to be imported if
Wataniya does not have permission from Israel's Ministry of
Communications for Ericsson to install and operate the
equipment on Wataniya's behalf (ref B). He said that
Wataniya applied for this permission in early September, but
had not received a response as of September 24.

Wataniya working for COGAT cooperation
--------------


5. (C) Richardson underscored that Wataniya's launch,
currently scheduled for February-March 2009, depends on
cooperation with the GOI. He has held several meetings with
officials from COGAT, the Israeli Ministry of Communications,
and Israeli customs to obtain necessary permits. Richardson
said he expects the network construction process to go
smoothly, while also noting the numerous unforeseen delays in
Wataniya's receiving a GOI-allocated frequency.
MARCHESE