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The Middle East and North Africa telecoms market: trends and forecasts 2015–2020

The Middle East and North Africa telecoms market: trends and forecasts 2015–2020

We anticipate strong growth in mobile and broadband markets in most countries in the Middle East and North Africa (MENA) region, but competition, market saturation and political instability will have an impact in some. This report explains these key trends and drivers, and provides comprehensive telecoms market forecasts for the region and for eleven individual countries.


Executive summary
The telecoms service market in the Middle East and North Africa will grow at a 1.7% CAGR between 2014 and 2020 to USD93.4 billion
Mobile handset data services will be the largest source of retail revenue growth in MENA between 2014 and 2020, followed by fixed broadband
Fixed and mobile revenue will grow in most countries, but competition, market saturation and lack of investment will have an impact in some
Key trends, drivers and assumptions for the mobile and fixed markets
Key implications and recommendations for telecoms operators
Regional forecasts and cross-country comparison
Geographical coverage: We model eleven telecoms markets, which will account for about 68% of MENA's telecoms service revenue in 2020
Market context: The eleven modelled countries account for 64% of total population and 72% of telecoms service revenue in MENA in 2014
Revenue and ARPU: Mobile and fixed data services will drive revenue growth in the region, but mobile voice revenue will continue to dominate
Mobile penetration: Maturing markets and diminishing multiple-SIM ownership will lead to slower growth in the number of connections
Mobile connections: Slightly more than half of all connections will be 3G by 2020, while LTE will account for 21.5% of mobile SIMs (excluding M2M)
Smartphones and LTE: Israel will have the highest smartphone penetration, but the UAE will lead LTE take-up rates over the next 5 years
Mobile ARPU: Intensified competition will drive down ARPU, but at a reduced pace because spending on non-voice services will increase
Fixed services: Broadband will experience strong growth in most countries, driven by fibre adoption, but DSL will retain the largest share
Fixed broadband: Household penetration will grow in all markets, driven by market competition and supported by national broadband plans
Key drivers at a glance for each Middle East and North Africa market
Individual country forecasts
Algeria: Retail revenue will grow at a 2.6% CAGR during 2014–2020, driven by high demand for 3G and fixed broadband services
Algeria – mobile: 3G will drive demand for mobile data services and help to maintain solid growth in the non-messaging segment
Algeria – fixed: The fixed broadband market has great potential for growth driven by fixed LTE, but DSL will continue to dominate
Egypt: Service revenue will grow at a modest 1.0% CAGR through 2020 because of subdued demand and weakened economy
Egypt – mobile: Revenue growth will lag behind subscriber growth during 2014–2020 because of the economic challenges
Egypt – fixed: Infrastructure modernisation will promote fixed access, while businesses will help slowdown ASPU voice erosion
Iraq: 3G presents a strong growth opportunity in the non-voice service segment amidst a very volatile security situation
Iraq – mobile: Persistent internal conflict will take its toll on the mobile market, but 3G offers some grounds for building revenue
Iraq – fixed: Fixed line inactivity and poor infrastructure will drive down voice revenue, while broadband holds potential for growth
Israel: Competition and price erosion will continue to impact mobile revenue; fixed market liberalisation will spur competition
Israel – mobile: Intense competition will result in Israel being the country with the most significant revenue decline in MENA
Israel – fixed: Wholesale reforms launched in 2015 will spur further competition in the fixed voice and broadband markets
Kuwait: Mobile market dynamism and growth will be contrasted by a fixed market that lacks competition and investment
Kuwait – mobile: LTE will increasingly be central to mobile market competition as revenue growth has become more challenging
Kuwait – fixed: Establishment of an independent regulator and fixed-mobile partnerships could unlock fibre market potential
Morocco: Voice revenue will decline, but will dominate the market, while mobile handset data will be the fastest-growing category
Morocco – mobile: Acceleration of 3G adoption and the launch of 4G in 2015 will help operators to shift revenue mix towards data
Morocco – fixed: Businesses will aid fixed voice ASPU uplift in the short term, while competition will support broadband adoption
Oman: Service revenue will grow at a 2.6% CAGR over 2014–2020, driven by data services and aided by infrastructure investment
Oman – mobile: Market saturation will subdue subscriber growth, while demand for data services will help boost revenue
Oman – fixed: Ambitious government-backed fibre roll-out plans will help boost FTTH take-up, while fixed voice revenue will decline
Qatar: Strong population and economic growth will help telecoms services to generate nearly QAR10.6 billion in revenue by 2020
Qatar – mobile: Demand from migrants will sustain connections growth, while postpaid and 4G segments will support value growth
Qatar – fixed: Ambitious fibre roll-out plans and government support will help stimulate demand for broadband services
Saudi Arabia: Broadband data services will drive retail revenue growth, but challenges will taper short-term market outlook
Saudi Arabia – mobile: Regulatory measures, MVNOs and Mobily's performance are weighing down market growth prospects
Saudi Arabia – fixed: Operators' roll-out plans will drive service take-up, and the business segment will help reduce ASPU erosion
Tunisia: Infrastructure investments and competition will help stimulate growth amidst political and social challenges
Tunisia– mobile: Continued demand for mobile services – data in particular – will drive growth despite an uncertain political outlook
Tunisia– fixed: The broadband market will grow slowly because of competition from 3G (and eventually 4G) mobile Internet services
UAE: Economic and population growth will help increase telecoms services retail revenue to AED43.3 billion by 2020
UAE – mobile: Smartphone penetration and data usage will drive revenue growth, helping to slow ARPU erosion through 2020
UAE – fixed: The introduction of infrastructure sharing will stimulate competition and force operators to invest and innovate
About the author and Analysys Mason
About the author
About Analysys Mason
Research from Analysys Mason
Consulting from Analysys Mason
List of figures
Figure 1: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Middle East and North Africa, 2010–2020
Figure 2: Telecoms retail revenue growth by service type, Middle East and North Africa, 2014–2020
Figure 3: CAGRs for fixed and mobile retail revenue (2014–2020) and market size by total retail revenue (2020), by country, Middle East and North Africa
Figure 4: Summary of key trends, drivers and assumptions for Middle East and North Africa
Figure 5: Mobile connections by technology generation and fixed broadband household penetration, by country, Middle East and North Africa, 2020
Figure 6: Metrics for the eleven countries modelled individually in Middle East and North Africa, 2014
Figure 7: Telecoms retail revenue by service type, fixed voice and fixed broadband ASPU, and mobile ARPU, Middle East and North Africa, 2010–2020
Figure 8: Telecoms retail revenue by service type, total service revenue and growth rates, Middle East and North Africa, 2014–2020
Figure 9: Connections by type, and growth rates, Middle East and North Africa, 2014–2020
Figure 10: Active mobile SIM penetration by country (excluding M2M), Middle East and North Africa, 2010–2020
Figure 11: Mobile connections by technology generation (excluding M2M), and 3G and 4G's share of connections, Middle East and North Africa, 2010–2020
Figure 12: Smartphones as a percentage of handsets, and LTE's share of total connections (excluding M2M), Middle East and North Africa, 2014 and 2020
Figure 13: Mobile ARPU by country, Middle East and North Africa, 2010–2020
Figure 14: Fixed broadband connections by type, and fixed voice, IPTV and mobile broadband connections, Middle East and North Africa, 2010–2020
Figure 15: Fixed broadband penetration of households by country, Middle East and North Africa, 2010–2020
Figure 16: Major forecast drivers and impact, by country, Middle East and North Africa, 2015–2020
Figure 17: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Algeria, 2010–2020
Figure 18: Telecoms retail revenue by service type, total service revenue and growth rates, Algeria, 2014–2020
Figure 19: Connections by type, and growth rates, Algeria, 2014–2020
Figure 20: Mobile, smartphone and 4G penetration rates, Algeria, 2010–2020
Figure 21: Mobile ARPU by type, and mobile ARPU, Algeria, 2010–2020
Figure 22: Summary of key mobile market drivers and assumptions, Algeria
Figure 23: Fixed penetration rates by service type, Algeria, 2010–2020
Figure 24: Fixed ASPU by service type, Algeria, 2010–2020
Figure 25: Summary of key fixed market drivers and assumptions, Algeria
Figure 26: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Egypt, 2010–2020
Figure 27: Telecoms retail revenue by service type, total service revenue and growth rates, Egypt, 2014–2020
Figure 28: Connections by type, and growth rates, Egypt, 2014–2020
Figure 29: Mobile, smartphone and 4G penetration rates, Egypt, 2010–2020
Figure 30: Mobile ARPU by type, and mobile ARPU, Egypt, 2010–2020
Figure 31: Summary of key mobile market drivers and assumptions, Egypt
Figure 32: Fixed penetration rates by service type, Egypt, 2010–2020
Figure 33: Fixed ASPU by service type, Egypt, 2010–2020
Figure 34: Summary of key fixed market drivers and assumptions, Egypt
Figure 35: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Iraq, 2010–2020
Figure 36: Telecoms retail revenue by service type, total service revenue and growth rates, Iraq, 2014–2020
Figure 37: Connections by type, and growth rates, Iraq, 2014–2020
Figure 38: Mobile, smartphone and 4G penetration rates, Iraq, 2010–2020
Figure 39: Mobile ARPU by type, and mobile ARPU, Iraq, 2010–2020
Figure 40: Summary of key mobile market drivers and assumptions, Iraq
Figure 41: Fixed penetration rates by service type, Iraq, 2010–2020
Figure 42: Fixed ASPU by service type, Iraq, 2010–2020
Figure 43: Summary of key fixed market drivers and assumptions, Iraq
Figure 44: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Israel, 2010–2020
Figure 45: Telecoms retail revenue by service type, total service revenue and growth rates, Israel, 2014–2020
Figure 46: Connections by type, and growth rates, Israel, 2014–2020
Figure 47: Mobile, smartphone and 4G penetration rates, Israel, 2010–2020
Figure 48: Mobile ARPU by type, and mobile ARPU, Israel, 2010–2020
Figure 49: Summary of key mobile market drivers and assumptions, Israel
Figure 50: Fixed penetration rates by service type, Israel, 2010–2020
Figure 51: Fixed ASPU by service type, Israel, 2010–2020
Figure 52: Summary of key fixed market drivers and assumptions, Israel
Figure 53: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Kuwait, 2010–2020 Figure 54:
Figure 54: Telecoms retail revenue by service type, total service revenue and growth rates, Kuwait, 2014–2020
Figure 55: Connections by type, and growth rates, Kuwait, 2014–2020
Figure 56: Mobile, smartphone and 4G penetration rates, Kuwait, 2010–2020
Figure 57: Mobile ARPU by type, and mobile ARPU, Kuwait, 2010–2020
Figure 58: Summary of key mobile market drivers and assumptions, Kuwait
Figure 59: Fixed penetration rates by service type, Kuwait, 2010–2020
Figure 60: Fixed ASPU by service type, Kuwait, 2010–2020
Figure 61: Summary of key fixed market drivers and assumptions, Kuwait
Figure 62: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Morocco, 2010–2020
Figure 63: Telecoms retail revenue by service type, total service revenue and growth rates, Morocco, 2014–2020
Figure 64: Connections by type, and growth rates, Morocco, 2014–2020
Figure 65: Mobile, smartphone and 4G penetration rates, Morocco, 2010–2020
Figure 66: Mobile ARPU by type, and mobile ARPU, Morocco, 2010–2020
Figure 67: Summary of key mobile market drivers and assumptions, Morocco
Figure 68: Fixed penetration rates by service type, Morocco, 2010–2020
Figure 69: Fixed ASPU by service type, Morocco, 2010–2020
Figure 70: Summary of key fixed market drivers and assumptions, Morocco
Figure 71: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Oman, 2010–2020
Figure 72: Telecoms retail revenue by service type, total service revenue and growth rates, Oman, 2014–2020
Figure 73: Connections by type, and growth rates, Oman, 2014–2020
Figure 74: Mobile, smartphone and 4G penetration rates, Oman, 2010–2020
Figure 75: Mobile ARPU by type, and mobile ARPU, Oman, 2010–2020
Figure 76: Summary of key mobile market drivers and assumptions, Oman
Figure 77: Fixed penetration rates by service type, Oman, 2010–2020
Figure 78: Fixed ASPU by service type, Oman, 2010–2020
Figure 79: Summary of key fixed market drivers and assumptions, Oman
Figure 80: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Qatar, 2010–2020
Figure 81: Telecoms retail revenue by service type, total service revenue and growth rates, Qatar, 2014–2020
Figure 82: Connections by type, and growth rates, Qatar, 2014–2020
Figure 83: Mobile, smartphone and 4G penetration rates, Qatar, 2010–2020
Figure 84: Mobile ARPU by type, and mobile ARPU, Qatar, 2010–2020
Figure 85: Summary of key mobile market drivers and assumptions, Qatar
Figure 86: Fixed penetration rates by service type, Qatar, 2010–2020
Figure 87: Fixed ASPU by service type, Qatar, 2010–2020
Figure 88: Summary of key fixed market drivers and assumptions, Qatar
Figure 89: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Saudi Arabia, 2010–2020
Figure 90: Telecoms retail revenue by service type, total service revenue and growth rates, Saudi Arabia, 2014–2020
Figure 91: Connections by type, and growth rates, Saudi Arabia, 2014–2020
Figure 92: Mobile, smartphone and 4G penetration rates, Saudi Arabia, 2010–2020
Figure 93: Mobile ARPU by type, and mobile ARPU, Saudi Arabia, 2010–2020
Figure 94: Summary of key mobile market drivers and assumptions, Saudi Arabia
Figure 95: Fixed penetration rates by service type, Saudi Arabia, 2010–2020
Figure 96: Fixed ASPU by service type, Saudi Arabia, 2010–2020
Figure 97: Summary of key fixed market drivers and assumptions, Saudi Arabia
Figure 98: Telecoms retail revenue by service type and total service revenue (retail and wholesale), Tunisia, 2010–2020
Figure 99: Telecoms retail revenue by service type, total service revenue and growth rates, Tunisia, 2014–2020
Figure 100: Connections by type, and growth rates, Tunisia, 2014–2020
Figure 101: Mobile, smartphone and 4G penetration rates, Tunisia, 2010–2020
Figure 102: Mobile ARPU by type, and mobile ARPU, Tunisia, 2010–2020
Figure 103: Summary of key mobile market drivers and assumptions, Tunisia
Figure 104: Fixed penetration rates by service type, Tunisia, 2010–2020
Figure 105: Fixed ASPU by service type, Tunisia, 2010–2020
Figure 106: Summary of key fixed market drivers and assumptions, Tunisia
Figure 107: Telecoms retail revenue by service type and total service revenue (retail and wholesale), UAE, 2010–2020
Figure 108: Telecoms retail revenue by service type, total service revenue and growth rates, UAE, 2014–2020
Figure 109: Connections by type, and growth rates, UAE, 2014–2020
Figure 110: Mobile, smartphone and 4G penetration rates, UAE, 2010–2020
Figure 111: Mobile ARPU by type, and mobile ARPU, UAE, 2010–2020
Figure 112: Summary of key mobile market drivers and assumptions, UAE
Figure 113: Fixed penetration rates by service type, UAE, 2010–2020
Figure 114: Fixed ASPU by service type, UAE, 2010–2020
Figure 115: Summary of key fixed market drivers and assumptions, UAE

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