Iran Telecommunications Report Q4 2015
BMI View: Iran's telecoms market is an underperformer in the Middle East as a result of political andeconomic risks, exacerbated by currency depreciation. Access to the latest devices is limited. The UNSecurity Council's unanimous vote in July 2015 to lift the sanctions against Iran, following a deal on Iran'snuclear programme, however, warrants an optimistic outlook. BMI's Country Risk team has made a slightupward revision to our economic growth forecast for Iran, projecting real GDP growth to pick up from 0.6%in 2015, to 2.9% in 2016 and 3.6% in 2017. This is also likely to have a positive effect on the mobile marketand potentially attract more foreign investment. Although mobile penetration in Iran is relatively high at136.1%, BMI believes that there is further scope for growth. Data services, in particular, will grow at anaverage rate of 36.2% CAGR over the next five years. Iran's second biggest mobile operator MTN Irancellhas launched 3G and 4G services and market leader MIC is planning to do so in the very near future.
We estimate that fixed-line connections increased by 3.0% in 2014 and we expect growth to slow downin the forecast period because of fixed-mobile substitution and a greater focus on mobile services fromfixed incumbent TCI.
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