2014 Middle East - Digital Media, Broadband and Internet Market and Forecasts

The Middle East is a tech-savvy region ripe for embracing new digital media developments

The Middle Eastern society as a whole; is an enthusiastic adopter of technology, digital media, online entertainment and social media. Jordan in particular has emerged as a regional tech start-up hub due to an ICT focused education system, low start up costs and business-friendly government. Its growing reputation is increasingly attracting international capital eager to tap into the region’s underserved growing online market.

Turkey also possesses a significant telecommunications market region due to its large population, which is characterised as young, increasingly urbanised and technically literate. Its developing economy has been shaped by the EU accession process.

Many countries now recognise the potential of applying ICT to improve both social and economic development. Kuwait, for example, has taken steps to develop a digital economy with the development of national level policies for e-health and e-government as well as a number of services now available online. Saudi Arabia received praise in 2013 from the World Bank which acknowledged the kingdom’s efforts in implementing business reforms such as electronic filing and new payment systems.

Despite ongoing conflict in Syria; e-government services are available, with a national e-government policy in place to guide developments. To support e-health development, public funding has been made available for ICT equipment, software, pilot projects, skills training and scholarships. E-health initiatives in Syria also extend to the mobile sector (m-health), with m-health initiatives undertaken.

Despite the growing Internet user base across the Middle East; the lack of adequate delivery infrastructure has been cited as an impediment to digital media development, although this is improving.

Internet usage in Iran, for example, is growing due to improved accessibility brought about by competition and government initiatives. Broadband penetration in Iran is improving given the growing number of competing ISPs, made possible through a licensing scheme. Recognising the potential of applying ICT to improve both social and economic development, Iran has taken steps to develop a digital economy. However this has been contradicted by Iran’s systematic and ongoing efforts to censor the Internet, with an initiative underway to deploy a “National Internet”.

Recognising the productivity benefits of fast broadband access, governments in the Middle East have endeavoured to either create regulatory conditions conducive to broadband investment or directly engaged in deploying national broadband networks.

Broadband in Oman for example represents the majority of the countries Internet connections and competition is predominantly infrastructure based.

In Israel, broadband speeds are increasing as Bezeq and HOT expand coverage of fibre access networks while the recent launch of additional submarine cables which offer ISPs an opportunity to reduce their own costs.

Broadband availability is also improving in Lebanon, with access available via DSL, fibre, WiMAX, WiFi, iBurst and 3G/LTE platforms. Despite the challenges of relatively poor infrastructure, Lebanon is home to a growing technology sector, complete with local start-up incubators, designed to provide seed funding and mentoring to technology entrepreneurs.

Broadband Internet in Iraq is available through a variety of platforms, including ADSL, satellite, WiMAX, CDMA and mobile broadband. Internet cafes are a popular Internet access method given low PC ownership.

National Broadband Network (NBN) development is underway in some markets with Qatar being one example of a country embarking on developing a national fibre-based access network, known as QNBN. Bahrain also recognises the socioeconomic advantages of a connected society and has deployed its own National Broadband Network (NBN), using infrastructure from the national Electricity and Water utility company and promising speeds of up to 1Gb/s.

Despite the Middle East having some issues to overcome such as political unrest, lack of infrastructure and poverty in some markets; there is much to be positive about in this emerging tech-savvy region. Progress towards establishing better fixed and mobile infrastructure will only continue to fuel the growing demand for digital media and entertainment services, such as online video and IPTV.

In particular, the UAE may well attract international interest in the future from OTT video service providers due to its established and growing broadband population and substantial purchasing power of a tech savvy population. Domestic incumbent Etisalat has already positioned itself in this market with its multi-screen OTT TV and VoD service called eLife.

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