Executive summary
Improved competition will unleash full market potential
Since the onset of competition Oman’s telecoms market has developed in leaps and bound. In the fixed line market incumbent operator Omantel has responded to the inexorable fall in its market share by reducing tariffs and introducing new products and services. Nawras, the only competitor in the fixed-line market, has built its own infrastructure and focused its initial marketing efforts in the fixed line market on high value customers.
Linked to the lack of competition in the market, fixed-line penetration is low, even by regional standards, as is fixed Internet and broadband subscriber penetration. Broadband is available via leased line, ADSL, WiFi, WiMAX and FttX. Low broadband subscriber levels only highlight the challenges Oman faces in its ambition of developing a knowledge based economy. To improve the fundamentals, a universal service obligation has been approved, which includes a requirement to provide the public with Internet access speeds of at least 512Kb/s and public institutions with Internet access speeds of at least 2MB/s. Specific e-government and e-health initiatives have been implemented, guided by national level policies in both areas.
The mobile market is the most dynamic telecoms market in Oman. Competition improved in a market comprised of two mobile network operators, Omantel and Nawras, following the introduction of Mobile Virtual Network Operators (MVNO)s. A total of five competitors have entered Oman’s mobile market as MVNOs and in three years of operation have steadily built up market share to account for 10% of total subscriptions. This has been made possible in part due to the implementation of mobile number portability, with Oman one of the first countries in the region to implement the regulatory requirement. Competition should further improve after one of the MVNOs was awarded a mobile network operators licence in early 2011.
Both of the established mobile network operators have implemented 3G networks, setting the stage for a new growth phase centred on mobile broadband services.
