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2008 Middle East - Telecoms Mobile & Broadband in The Gulf Countries

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Last updated: 15 Aug 2008 Update History

Report Status: Archived

Report Pages: 156

Analyst: Stephen McNamara

Publication Overview

This annual report offers a wealth of information on trends and developments in telecommunications, mobile, Internet, broadband in the Gulf countries of Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, UAE and Yemen. Subjects include:

·         Market and industry analyses, trends and developments;

·         Facts, figures and statistics;

·         Industry and regulatory issues;

·         Infrastructure;

·         Major Players, Revenues, Subscribers, ARPU;

·         Internet, VoIP, IPTV;

·         Mobile Voice and Data Markets;

·         Broadband (DSL, cable TV, wireless);

·         Convergence and Digital Media.


Researcher: Tine Lewis

Current publication date:- August 2008 (7th Edition)

Next publication date:- July 2007

 

 

Executive Summary

BuddeComm’s Middle East Annual Publication, 2008 Middle East - Telecoms, Mobile and Broadband in The Gulf Countries , profiles the wealthy countries of the GCC, developing Iraq and Yemen and the very regulated market of Iran.

 

The GCC countries have benefited to differing degrees, depending on their reserves, from the very high oil and gas prices. Even countries with less oil such as Bahrain or the emirate of Dubai have benefited from the wealth coming into the region. All countries realise the need to use the bonanza to upgrade their infrastructure. They are also keen to increase the ‘knowledge component’ of their economies as a bulwark against a potentially less profitable future. All of these factors have had a strong bearing on their telecoms industries. In addition, all the GCC countries have liberalised their markets to a greater or lesser degree, resulting in much greater competition, particularly in the mobile sector. This trend towards greater competition is still continuing, extending into the fixed-line and Internet sectors.

 

The markets of Iraq, Yemen and Iran are much less developed but are all quite exciting. In Iraq, the mobile market has been one of the great successes of the post-war period, growing from nothing to 44% penetration in four years. This is partly a result of very little fixed-line infrastructure. Three quite equal operators were competing in the market but after the award of longer-term licences there are now three much less equally sized players, which will possibly result in a less competitive and more expensive market. The lack of development in Iran is government induced rather than a result of economic factors. Since the launch of a second mobile operator in September 2006, this sector at least has been transformed with annual growth of over 100%. The broadband and Internet sectors are very different due to government restrictions on competition, speeds and services. The government is intending to introduce a level of private ownership into the incumbent operator and it will be interesting to see what effect this will have. Yemen, with GDP per capita of only around US$1,000 is nevertheless also experiencing healthy growth in its mobile market.

 

Key highlights:

·         The GCC countries are investing in NGN infrastructure, with FttH becoming a reality, particularly in the smaller and more urban countries. Broadband penetration levels do not appear high but improve once larger household sizes are accounted for. Household broadband penetration in the UAE is at least 40%.

·         Zain of Kuwait and Etisalat of the UAE have continued their expansion abroad. Zain now operates in 20 countries and Etisalat in 16, in the Middle East, Africa and Asia. Etisalat claimed to be the fastest growing mobile operator in the world in 2008, with a proportional mobile subscriber base of 24.2 million, an annual increase of 106.41%.

·         Qtel of Qatar is also expanding rapidly abroad, also with interests in 16 countries (most of them acquired in 2007), although as yet with a smaller subscriber total than Etisalat or Zain. STC of Saudi Arabia has aspirations to join the club, with new interests in Kuwait, South Africa and Turkey.

·         The remarkable regional DTH satellite TV market continues unabated, with around 300 FTA channels plus pay TV operators. Despite many channels being launched for political rather than commercial reasons, the competition is generating some very interesting players – news channels Al Jazeera and Al Arabiya and more entertainment-oriented channels from Rotana and others.

·         The launch of services by MTN Irancell has transformed the Iranian mobile market, causing annual growth of over 100%, hugely greater availability of services and introduced a degree of transparency to the market.

·         All countries have licensed at least two mobile operators. A third licence has been granted for Kuwait, while in Bahrain an auction for a third licence in imminent.

·         Saudi Arabia’s third mobile operator, Zain, is about to launch operations into an already very competitive market. Saudi Arabia will see major players STC, Etisalat and Zain go head to head.

·         Of the many new licences auctioned in the region in the past few years, the second Qatari mobile licence was the first to go to a European operator. Vodafone Qatar expects to launch services early in 2009.

·         Since the introduction of competition to the UAE mobile market, penetration rates have leapt to nearly 170%. Growth rates in all countries tend to reflect the degree of competition in the market rather than the penetration levels.

Mobile penetration and annual change in the Gulf countries – 2008

Year

Penetration

Annual change

Bahrain

123%

27%

Iran

37%

111%

Iraq

44%

27%

Kuwait

84%

10%

Oman

109%

33%

Qatar

122%

20%

Saudi Arabia

116%

43%

UAE

169%

38%

Yemen

18%

38%

(Source: BuddeComm)

 

 

 

For those needing high level strategic information and objective analysis on this region, this report is essential reading and gives further information on:

·         Government policies affecting the telecoms industry in all countries, including incumbent share sales in Oman and Iran, a new mobile licence auction in Bahrain and generally increased liberalisation across the region;

·         Telecoms operators – acquisitions, competition and new market entrants – the powerful international players Zain, Etisalat, Qtel and perhaps STC in near future;

·         Internet and broadband development and government policies accelerating or impeding the potential for growth;

·         The fast growing mobile markets of the region, still with much potential particularly in the repressed market of Iran and in developing Iraq and Yemen.

·         Mobile data and wireless broadband developments as 3G subscribers increase and HSDPA and WiMAX services proliferate.

 

Data in this report is the latest available at the time of preparation and may not be for the current year.

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