Arab Communications Market

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  • Egypt’s PSTN subscribers are expected to continue exceeding mobile subscribers throughout the coming four years

Transcript

  • 1. Arab Communications Markets Jawad Abbassi [email_address] ITU Private Sector Cooperation Meeting in the Arab Region – Amman October 2003
  • 2. Outline
      • Communications and Internet situation in the Arab World
      • The effects of liberalization and privatization on infrastructure and service availability
      • The upcoming competitive landscape in Arab countries
  • 3. A Regional Comparison *Figures by end of 2002 Source: Arab Advisors Group’s Reports 0.8% 5.5% 11.7% Tunisia 0.4% 2.3% 11.9% Syria 2.6% 22.8% 15.1% Saudi Arabia 8.3% 64.7% 29.1% UAE 3.2% 43.0% 28.5% Qatar 2.5% 16.5% 10.2% Oman 0.2% 20.8% 3.4% Morocco 3.9% 20.9% 20.9% Lebanon 9.5% 57.7% 21.3% Kuwait 1.3% 22.4% 12.7% Jordan 0.3% 6.6% 11.4% Egypt 7.4% 54.3% 24.4% Bahrain 0.2% 1.4% 6.2% Algeria Internet (Accounts) % GSM % PSTN % Country
  • 4. PSTN Penetration (%)
  • 5. GSM Penetration (%)
  • 6. Internet Accounts Penetration (%)
  • 7. A Regional Comparison ** Figures by end of 2002 Source: Arab Advisors Group’s Reports 14 42 33 Tunisia 13 70 16 Syria 31 51 56 UAE 22 73 71 Saudi Arabia 102 54 120 Qatar 8 14 36 Morocco 20 75 52 Lebanon 48 54 65 Kuwait 22 30 46 Jordan 8 22 15 Egypt 45 46 71 Bahrain 64 12 Algeria Internet ARPU $ GSM ARPU $ PSTN ARPU $ Country
  • 8. Regional GSM Subscriber Mix ** Figures by end of 2002 unless indicated otherwise Source: Arab Advisors Group’s Report “A KPI Scorecard of Arab Telecom Operators” – June 2003 80% 20% Tunisie Telecom (Tunicell) 84% (March 2003) 16% (March 2003) Vodafone Egypt 67% (March 2003) 33% (March 2003) Orascom Telecom Algeria 94% 6% Jawwal - Palestine 94% 6% Wataniya - Kuwait 93% 7% MediTel - Morocco 80% 20% MobileCom - Jordan 80% 20% MobiNil - Egypt 78% 22% Batelco – Bahrain 70% 30% Fastlink – Jordan 59% 41% MTC Vodafone - Kuwait 51% 49% Q-TEL - Qatar 43% 57% STC – Saudi Arabia 0% 100% Syria Tel - Syria 0% 100% Space Tel -Syria Prepaid % Postpaid % Operator/Country
  • 9. Global PSTN Status Source: Arab Advisors Group’s Report “A KPI Scorecard of Arab Telecom Operators” – June 2003
  • 10. Global GSM Status Source: Arab Advisors Group’s Report “A KPI Scorecard of Arab Telecom Operators” – June 2003
  • 11. Global Internet Use Status
  • 12. Mobiles and Mainlines Source: Operators, Arab Advisors Group
      • When Mobiles exceeded / will exceed PSTN lines:
      • Bahrain, Kuwait, Morocco and UAE in 2000
      • Jordan, Lebanon, Oman and Qatar in 2001
      • Saudi Arabia in 2002
      • Tunisia, expected in 2003
      • Algeria, expected in 2004
      • Syria, expected in 2007
    Source: Arab Advisors Group’s “A Comparative Analysis of the Cellular and Mainlines Markets in the Arab World” – October 2002
  • 13. Mainlines Market Share Index
    • ** Figures by end of 2002
    • Index= % Share of PSTN Market/% Share of Population
    • Source: Arab Advisors Group’s Reports
    1.11 5.47% 4.95% Tunisia 1.12 10.01% 8.91% Syria 2.76 5.22% 1.89% UAE 1.43 15.82% 11.10% Saudi 2.70 0.84% 0.31% Qatar 0.97 1.31% 1.35% Oman 0.32 4.89% 15.06% Morocco 1.98 3.82% 1.93% Lebanon 2.01 2.30% 1.14% Kuwait 1.20 3.22% 2.69% Jordan 1.07 36.96% 34.40% Egypt 2.31 0.84% 0.36% Bahrain 0.58 9.30% 15.90% Algeria Index* % Share of PSTN Market % Share of the Population Country
  • 14. Cellular Market Share Index
    • ** Figures by end of 2002
    • Index= % Share of GSM Market/% Share of Population
    • Source: Arab Advisors Group’s Reports
    0.5 2.27% 4.95% Tunisia 0.1 1.86% 15.90% Algeria 5.4 10.15% 1.89% UAE 0.2 1.67% 8.91% Syria 1.9 20.93% 11.10% Saudi 3.6 1.12% 0.31% Qatar 1.4 1.86% 1.35% Oman 1.7 25.91% 15.06% Morocco 1.7 3.34% 1.93% Lebanon 4.8 5.46% 1.14% Kuwait 1.9 4.98% 2.69% Jordan 0.5 18.82% 34.40% Egypt 4.5 1.63% 0.36% Bahrain Index* % Share of GSM Market % Share of the Population Country
  • 15. Arab Advisors IVCU Index A total of 64.1 K circuits and 5.38 billion minutes * International Voice Circuits Utilization (IVCU) Index. Source: Arab Advisors - International Connectivity in the Arab World 12.8% 16.4% 1.28 Egypt 12.1% 5.3% 0.44 Lebanon 2.7% 7.2% 2.68 Syria 3.2% 6.5% 2.05 Jordan 4.0% 3.9% 0.98 Oman 20.9% 23.4% 1.12 UAE 33.9% 29.6% 0.87 Saudi Arabia 7.1% 4.5% 0.63 Kuwait % share of minutes % Share of Circuits IVCU* Index Country
  • 16. Advanced Services Availability No Yes LibanCell - Lebanon Yes Yes Wataniya – Kuwait No Yes Qatar – Q-Tel No No Saudi Arabia - STC No No Tunisiana - Tunisia Yes Yes UAE – Etisalat No No SyriaTel - Syria No Yes Tunisie Telecom -Tunisia No No Algerie Telecom Mobile Yes Yes Maroc Telecom No Yes Cellis - Lebanon Yes Yes MTC Vodafone – Kuwait Yes Yes MobileCom - Jordan Yes Yes Fastlink - Jordan Yes Yes Vodafone Egypt - Egypt Yes Yes MobiNil - Egypt Yes Yes Batelco – Bahrain MMS GPRS Operator / Country
  • 17. Int’l Connectivity Operators
    • Two major international submarine fiber optic cables and three satellite operators
      • Arabsat
      • Intelsat
      • Inmarsat
      • SEA-ME-WE
      • FLAG
  • 18. Regional Internet Bandwidth Capacity Index Source: ArabAdvisors Group 31.79% 0.47% 18.90% 4.54% 5.77% 9.08% 3.96% 6.59% 18.90% % share of bandwidth 1.59 0.1 0.51 3.53 1.36 2.35 0.41 1.44 1.33 Regional bandwidth index+ 19.96% 4.83% 37.42% 1.29% 4.25% 3.86% 9.66% 4.57% 14.16% % share of Accounts 16 75,000 Syria 1,085 310,000 UAE 645 581,200 Saudi Arabia 155 20,000 Qatar 197 66,000 Oman 310 60,000 Morocco 135 150,000 Lebanon 225 71,000 Jordan 645 220,000 Egypt Internet Bandwidth Capacity Accounts Country
  • 19. Regional Utilized Internet Bandwidth Index Source: ArabAdvisors Group 21.70% 52.31% 0.77% 14.32% 1.83% 1.83% 2.89% 4.34% 21.70% % Share of Bandwidth 1.47 2.52 0.15 0.37 1.37 0.41 0.29 0.91 1.47 Regional Bandwidth Index+ 14.73% 20.76% 5.02% 38.92% 1.34% 4.42% 10.05% 4.75% 14.73% % Share of Accounts 1,085 75,000 Syria 450 310,000 UAE 16 581,200 Saudi Arabia 297 20,000 Qatar 38 66,000 Oman 38 60,000 Morocco 60 150,000 Lebanon 90 71,000 Jordan 450 220,000 Egypt Internet Bandwidth Capacity Accounts Country
  • 20. Competition in the Region? Source: Arab Advisors Group’s Reports Monopoly Competitive Duopoly Monopoly Morocco Monopoly Monopoly Libya Competitive Duopoly Monopoly Algeria Monopoly Competitive Duopoly Monopoly Tunisia Competitive Competitive Duopoly Monopoly Egypt Competitive Competitive Duopoly Monopoly Lebanon Monopoly Controlled Duopoly Duopoly Monopoly Syria Competitive Competitive Duopoly Monopoly Jordan Monopoly Monopoly Monopoly Monopoly Oman Monopoly Monopoly Monopoly Monopoly UAE Monopoly Monopoly* Duopoly Monopoly Bahrain Monopoly Monopoly Monopoly Monopoly Qatar Monopoly Competitive Monopoly Monopoly Saudi Arabia Competitive Competitive Duopoly Monopoly Kuwait Datacomm Internet GSM PSTN Country
  • 21. Why is Competition Important?
    • Better and more responsive service
    • Expanding bases of consumers of communications services
    • Cost-based pricing (tariff rebalancing, which could mean lower or higher rates)
    • Enhance global investor interest and create employment
  • 22. Upcoming liberalization plans
    • Bahrain
    • Second mobile license granted in April 2003
    • Internet competition before the end of the year
    • Second fixed line operator (including ILD) expected by 2005
    • Egypt
    • Full competition (i.e. a third GSM operator) by 2005
    • Second fixed line operator (including ILD) expected by 2006
  • 23. Upcoming liberalization plans
    • Jordan
    • iDEN operator to be launched in 2004
    • A third GSM operator in 2004
    • Second fixed line operator (including ILD) by 2005
    • Kuwait
    • Full competition (i.e. a third GSM operator) expected by 2005-2006
    • Second fixed line operator (including ILD) expected by 2005-2006
  • 24. Upcoming liberalization plans
    • Algeria
    • A second fixed line operator (including ILD) expected in 2004
    • Third GSM operator expected in 2004
    • Tunisia
    • Second fixed line operator expected in 2004
  • 25. Upcoming liberalization plans
    • Lebanon
    • A third GSM operator expected in 2004
    • Second fixed line operator (including ILD) expected after 2005
    • Morocco
    • The first to introduce ILD competition in the region. Two Radio Trunking operators.
    • Expected to be the first to grant a second fixed line license in 2003/2004. Delays and one failed attempt
  • 26. Upcoming liberalization plans
    • Qatar
    • Second GSM operator expected by 2005
    • No clear timeline for a second fixed line operator (including ILD)
    • Saudi Arabia
    • STC partially privatized 30% in January 2003
    • Second GSM license during the last quarter in 2004
    • Second fixed line operator in 2008
  • 27. Upcoming liberalization plans
    • UAE
    • Duopoly of GSM market expected by end of 2005
    • Second fixed line operator (including ILD) expected by 2005
    • Oman
    • Duopoly of GSM market expected in 2005
  • 28. Upcoming liberalization plans
    • Syria
    • No second fixed line operator, nor third mobile operator expected in the coming four years
    • Iraq
    • Competition of GSM market expected by 2004
    • (Results of tender for 3 licenses should be issued by end of September 2003)
    • Palestine
    • Jawwal’s license ends in 2003. Still no tender for a second operator.
    • PalTel has a 20 year license, which expires in 2015.
  • 29. Global Telecom Operators in the MENA Region Morocco 30.5% MediTel Portugal Telecom Morocco 30.5% MediTel Telefonica Morocco 35% Marco Telecom Vivendi Universal Egypt 36.3% of ECMS 71.25% of MobiNil ECMS-MobiNil Orange Jordan 31% Jordan Telecom France Telecom Egypt 67% Vodafone- Egypt Vodafone Bahrain 20% Batelco Cable & Wireless Country Ownership Investment in Foreign Investor
  • 30. Regional Operators QualityNet WLL Soficom Communications SAE Batelco Jordan Batelco Jeraisy company Ltd MobiNil Mobilink Orascom Telecom Algeria Orascom Telecom Tunisia Telecel Libertis Tchad Moile Shareholder in Kuwait Egypt Jordan Saudi Arabia Egypt Pakistan Algeria Tunisia Africa Congo Brazzavile Chad Country of Operation Batelco – Bahrain Orascom Telecom Holding – Egypt Operator
  • 31. Regional Operators Mauritania Mauritel Maroc Telecom - Morocco Thuraya Satellite System Sudatel Thuraya Satellite System Fastlink Orascom Telecom Tunisia Shareholder in International Etisalat - UAE International Jordan MTC Vodafone – Kuwait Tunisia Wataniya -Kuwait Country of Operation Operator
  • 32. The Lost Golden Years
    • The GSM license fees as cash cows for a few Arab governments
    • 1998-2000 were the years of massive telecom license valuations: Some Arab countries benefited (Egypt, Morocco), others lost the chance (Oman, Egypt, Lebanon, Jordan, etc.)
    • Markets remain growth markets and profitable. Much less hyped however!
  • 33. Enabling Proper Competition
    • Policy on local loop unbundling (or infrastructure-based competition)
    • Tariff rebalancing
    • Phasing out of cross subsidization (VoIP termination example)
    • Transparent and strong regulators
    • A courageous judiciary
    • The possible role of GSM operators in spearheading full competition
  • 34. Arab Advisors Group
    • Arab Advisors Group provides reliable research, analysis and
    • forecasts of Arab communications, media and technology
    • markets.
    • This presentation draws from around 180 reports published
    • by Arab Advisors Group’s team.
    • Arab Advisors Group consulting service has served new
    • telecom ventures in the Arab World whose investments in
    • Arab Telecom markets will exceed One billion US$.
    • www.arabadvisors.com
    • Tel: 962.6.5828849
    • F ax: 962.6.5828809
    • arabadvisors @arabadvisors.com