Does entry of Arab firm signal the opening up of North Korea’s mobile services market?

Orascom Telecom, the fourth-largest Arab phone operator based in Cairo, Egypt, announced that it earned the first commercial license to provide mobile telephone services in North Korea.

The license was given to a company subsidiary, CHEO Technology, of which North Korea's state-owned Korea Post and Telecommunications Corporation owns 25 percent, Orascom said in a press release posted on its website.

“The terms of the license allow CHEO to offer services to its customers throughout the country. The duration of the license is 25 years with an exclusivity period of four years,” it said.

The company intends to invest up to US$400 million in network infrastructure over the first thee years and plans to provide coverage in voice, data and value-added services for the capital city of Pyongyang and most of the major cities during the first 12 months in operation.

“We are continuing to head in the right strategic direction; our Greenfield license in (North Korea) is in line with our strategy to penetrate countries with high population and low penetration by providing the first mobile telephony services,” said Naguib Sawiris, the company chairman.

North Korea's population is estimated at around 23 million.

Another Orascom subsidiary struck an agreement in July 2007 to invest $115 million in a North Korean cement manufacturer for a 50 percent stake in the firm.

Does this move by the South Korean authorities indeed signal an opening up of the North Korean market?