Web-enabled phone call service Skype is in negotiations to set up its Middle East headquarters in Bahrain despite the service being banned in neighbouring countries.
The kingdom's telecommunications watchdog confirmed the Luxembourg-based company's plans to Arabian Business on Thursday.
Alan Horne, general director of the Telecommunications Regulatory Authority (TRA, said the move was "totally welcomed".
Skype, which allows users to make free voice and video calls through the internet, has been available to consumers in Bahrain for the past two-and-a-half years. It remains blocked in some other Gulf countries, like Oman and the UAE.
"Water flows down the course with the least resistance. Here's a technology that's futuristic, and why should consumers be blocked from using such a technology? That's our view, other countries take a different view," Horne said.
He told Arabian Business the prime reason that web phone call services like Skype were blocked was in order to protect the profits of nationally-owned telecom companies.
In May, Mohammed Omran, chairman of UAE-based Etisalat, admitted that lifting the ban on Skype would slash the firm's revenue from international calls.
"Definitely, if Skype is introduced in the UAE, that will affect the revenue not only for us, but for also for du. In the UAE, quite a good portion of the revenue comes from international calls and the tariffs in the UAE are still unbalanced."
A spokesman for Skype said he could not comment at the moment.