By allowing fixed and mobile operators to launch new services the regulator hopes to move towards a unified licensing regime.
Amr Badawy, Executive Chairman of Egypt's telecom regulator, said: "Telecom Egypt will be granted the right to offer mobile telephone services."
Badawy added that this license would be "executed by mid-2013".
However, the license to be awarded to Telecom Egypt is nothing more than a Mobile Virtual Network Operator (MVNO) license because it will not receive any spectrum but will instead have to negotiate wholesale access on one of the existing three mobile networks in Egypt.
The opening up of the telecoms market in Egypt is not one sided as the regulator stated that Telecom Egypt also be required to open up its fixed-line infrastructure for other operators to offer retail services.
The company does face a possible conflict of interest, given that it holds a 45 percent stake in Vodafone Egypt, one of the country’s three mobile networks.
Telecom Egypt is the only fixed line operator in Egypt and is 80 percent owned by the state.
Mobinil, which is controlled by France Telecom, and Dubai-based Etisalat are the other two networks in the North African country.