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Middle Eastern Fixed Voice and Telecommunications Infrastructure Market

This annual report offers a wealth of information on the regulatory background and fixed-line markets in the Middle East. Subjects covered include:

  • Fixed line statistics and trends;
  • National telecom networks and infrastructure;
  • International submarine cables;
  • Infrastructure developments;
  • Brief overviews of all major Middle Eastern fixed-line telecom operators.


This Middle East market report gives an overview of the fixed-line voice and infrastructure segment of the telecoms markets of the region. It details the major operators and infrastructure in each of the following countries: Bahrain, Egypt, Iran, Iraq, Israel, Jordan, Kuwait, Lebanon, Oman, Qatar, Saudi Arabia, Syria, Turkey, UAE and Yemen.

  In the Middle Eastern region telecommunications infrastructure varies from very advanced to very rudimentary. Several Fibre-to-the-Home projects are under development in Israel and the Gulf countries but in Yemen and Iraq fixed-line penetration is only around 5%. The area is well served with international links via submarine cables.

  At first glance fixed-line teledensity in the Arab Middle East would appear very low, even in the wealthier countries, compared with teledensity rates of around 60% in the USA for example. However, figures can be misleading due to the larger household sizes compared with Europe or the USA, plus large hostel-accommodated expatriate populations in some countries. In fact in many countries household penetration is at or near 100%. Several markets are showing decline due to mobile substitution, particularly dramatically in Jordan with its very competitive mobile market.

  Other than in Israel, each country has a national fixed-line operator but no other large players in the fixed-line sector. Even in the more liberalised markets of the Arab Middle East there are as yet no serious competitors to the incumbents but this is beginning to change, first in Bahrain through VoIP and calling-card operators and later WiMAX operators, and now also in Saudi Arabia, the UAE and Jordan. All fixed-line incumbents also offer mobile services.

  Top five Middle East countries for fixed-line teledensity - 2008
Country | GDP per capita | Population | Number of Households | Fixed lines | Fixed line growth | 2007/08 | Teledensity |
(US$) | (millions) |
Israel | 28,365 | 7.11 | 2.1 | 2.9 | -3% | 41% |
Iran | 4,732 | 72.9 | 13.0 | 24.8 | +4% | 34% |
UAE | 55,607 | 4.8 | 0.7 | 1.5 | +9% | 32% |
Bahrain | 27,248 | 0.78 | 0.12 | 0.22 | +8% | 27% |
Turkey | 10,472 | 69.7 | 16.0 | 17.5 | -4% | 25% |
| (Source: BuddeComm based on IMF, ITU and industry data)

    Key highlights: 

Bahrain


All sectors of the Bahraini communications market have been liberalised. Incumbent Batelco shares the fixed-line market with thirteen other operators providing international calling services using international direct dial, carrier pre-selection or prepaid calling cards. Around 50% of international call minutes originating from fixed lines use prepaid calling cards. Like other GCC countries, Bahrain has a large expat population (approximately 50% of the total) and this has been the cause of the impact of prepaid VoIP-based calling cards on the market and on Batelco’s international call revenues.  

Infrastructure is excellent - Batelco completed the rollout of an NGN in January 2009.  

Israel

While incumbent Bezeq still has a big majority of the domestic fixed-line market, its share has fallen rapidly since the introduction of number portability in December 2007 and by mid-2009 was down to 75%. VoIP operators and cable company HOT are the beneficiaries.

  The international fixed-line market has been very competitive for many years. Three operators dominate the market with roughly equal shares. All are keen to move into providing domestic call services and the three already share the majority of the ISP market.

  This market is particularly interesting as these players, together with the three mobile operators who are also moving into the fixed-line voice and Internet market, jostle for position. Significant investment is being made in NGN infrastructure.

  Saudi Arabia

Saudi Arabian fixed-line teledensity (and broadband penetration) are low. Competition has been introduced into the fixed-line market with hope that it will lead to similar extensive development as has happened in the mobile market with increased competition. Three companies were awarded licences - Batelco/Atheeb, US consortia MCI International/Verizon and Hong Kong-based PCCW. Data communication provision licences were also awarded to two companies - ITC and Bayanat Al Oula. Bayanat has since been acquired by mobile operator Mobily, a subsidiary of UAE incumbent Etisalat, which could result in a serious competitor for STC.  

All licence winners, together with incumbent STC, are making substantial investments in infrastructure and intend to make extensive use of WiMAX.  

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

1. Telecommunications Overview
1.1 Regulatory environment
1.1.1 Background
1.1.2 Regulatory authorities
1.1.3 Privatisation
1.1.4 Telecom sector liberalisation
1.1.5 Regulatory aspects of VoIP
1.2 Fixed network operators
1.2.1 Overview
1.3 Telecommunications infrastructure
1.3.1 Overview
1.3.2 NGNs
1.3.3 Submarine cable systems
1.3.4 Satellites
2. Bahrain
2.1 Overview of Bahrain’s telecom market
2.2 Fixed network operators in Bahrain
2.2.1 Bahrain telecommunications company (Batelco)
2.2.2 Alternative operators
2.3 Telecommunications infrastructure
2.3.1 National telecom network
2.3.2 International infrastructure
2.4 Wholesaling
2.4.1 Overview
3. Egypt
3.1 Overview of Egypt’s telecom market
3.2 Fixed Network Operators in Egypt
3.2.1 Telecom Egypt (TE)
3.2.2 Orascom Telecom
3.2.3 Fixed voice market
3.3 Telecommunications Infrastructure
3.3.1 National telecom network
3.3.2 International infrastructure
3.4 Forecasts - fixed-line services - 2010; 2015
4. Iran
4.1 Overview of Iran’s telecom market
4.2 Fixed network operators in Iran
4.2.1 Telecommunication Company of Iran (TCI)
4.2.2 Other licence holders / Zoha Kish
4.3 Telecommunications infrastructure
4.3.1 National telecom network
4.3.2 International infrastructure
5. Iraq
5.1 Overview of Iraq’s telecom market
5.2 Fixed network operators in Iraq
5.2.1 Iraqi Telephone and Postal Company (ITPC)
5.2.2 Wireless Local Loop operators
5.3 Telecommunications infrastructure
5.3.1 National telephone network
5.3.2 International infrastructure
6. Israel
6.1 Overview of Israel’s telecom market
6.2 Market analysis - 2009
6.3 Fixed Network Operators in Israel
6.3.1 Overview of operators
6.3.2 Bezeq
6.3.3 Bezeq International
6.3.4 HOT Cable Systems Media
6.3.5 NetVision 013 Barak
6.3.6 012 Smile.Communications (Internet Gold Golden Lines) / Eurocom
6.3.7 Xfone 018
6.4 Telecommunications Infrastructure
6.4.1 National telecom network
6.4.2 International infrastructure
6.4.3 Infrastructure developments
6.5 Wholesaling
6.5.1 Overview
7. Jordan
7.1 Overview of Jordan’s telecom market
7.2 Fixed network operators in Jordan
7.2.1 Jordan Telecom Group / JTG / Orange Jordan
7.3 Telecommunications infrastructure
7.3.1 National telecom network
7.3.2 International infrastructure
7.4 Wholesaling
7.4.1 Access
7.4.2 JTG’s pricing structure
7.4.3 Friction between JTG and other ISPs
8. Kuwait
8.1 Overview of Kuwait’s telecom market
8.2 Telecom operators in Kuwait
8.2.1 Ministry of Communications
8.2.2 Hits Telecom
8.3 Telecommunications infrastructure
8.3.1 National telecom network
8.3.2 International infrastructure
9. Lebanon
9.1 Overview of Lebanon’s telecom market
9.1.1 InvestCom
9.1.2 Saudi Oger / Oger Telecom
9.2 Fixed network operator in Lebanon
9.2.1 Ogero Telecom
9.3 Telecommunications infrastructure
9.3.1 National telecom network
9.3.2 International infrastructure
10. Oman
10.1 Overview of Oman’s telecom market
10.2 Fixed network operator in Oman
10.2.1 Oman Telecommunications Company (Omantel)
10.3 Telecommunications infrastructure
10.3.1 National telecom network
10.3.2 International infrastructure
10.4 Fixed Line services
10.4.1 Prepaid and postpaid fixed-line services
11. Qatar
11.1 Overview of Qatar’s telecom market
11.2 Fixed network operator in Qatar
11.2.1 Qtel
11.3 Telecommunications infrastructure
11.3.1 National telecom network
11.3.2 International infrastructure
12. Saudi Arabia
12.1 Overview of Saudi Arabia’s telecom market
12.2 Fixed network operators in Saudi Arabia
12.2.1 Saudi Telecom Company (STC)
12.2.2 ITC
12.2.3 Bayanat Al-Oula / Mobily
12.2.4 Etihad Atheeb Telecommunications Company
12.3 Telecommunications infrastructure
12.3.1 National telecom network
12.3.2 International infrastructure
13. Syria
13.1 Overview of Syria’s telecom market
13.2 Fixed network operator in Syria
13.2.1 Syrian Telecommunication Establishment (STE)
13.3 Telecommunications infrastructure
13.3.1 National telecom network
13.3.2 International infrastructure
14. Turkey
14.1 Overview of Turkey’s telecom market
14.2 Fixed Network Operators in Turkey
14.2.1 Overview
14.2.2 Turk Telekom
14.2.3 Turksat
14.3 Telecommunications Infrastructure
14.3.1 National telecom network
14.3.2 International infrastructure
15. United Arab Emirates
15.1 Overview of UAE’s telecom market
15.2 Market analysis - 2009
15.3 Telecom Operators in UAE
15.3.1 Emirates Telecommunications Corporation (Etisalat)
15.3.2 Emirates Integrated Telecommunications Company / du
15.3.3 TECOM Investments / Dubai Holding / Emirates International Telecommunications (EIT)
15.3.4 UAE investment companies owning telcos outside the UAE
15.4 Telecommunications Infrastructure
15.4.1 National telecom networks
15.4.2 Infrastructure developments
15.4.3 International infrastructure
16. Yemen
16.1 Overview of Yemen’s telecom market
16.2 Fixed network operators in Yemen
16.2.1 TeleYemen / Yemen International Telecommunication Company
16.2.2 Public Telecommunications Corporation (PTC)
16.3 Telecommunications infrastructure
16.3.1 National telecom network
16.3.2 International infrastructure
17. Glossary of Abbreviations
List of tables and Exhibits
Table 1 - GDP, households, fixed lines in service and teledensity in the Middle East - 2008
Table 2 - Batelco revenue and profit - Bahrain and other MENA - 2005 - 2008
Table 3 - Batelco revenue by division - 2005 - 2007
Table 4 - Batelco total group mobile subscribers - 2007 - 2008
Table 5 - Fixed lines in service and teledensity in Bahrain - 1995 - 2008
Table 6 - Telephone network statistics in Egypt - 2008
Table 7 - Telecom Egypt key performance indicators - 2003 - 2008
Table 8 - Fixed lines in service and teledensity in Egypt - 1995 - 2008
Table 9 - Public payphones per operator in Egypt - 2002 - 2008
Table 10 - Forecast fixed-line and fixed-wireless subscribers - 2010; 2015
Table 11 - Fixed lines in service and teledensity in Iran - 1995 - 2008
Table 12 - Fixed lines in service and teledensity in Iraq - 1990 - 2008
Table 13 - International call operators market shares in Israel - 2008
Table 14 - Bezeq divisional revenues - 2005 - 2009
Table 15 - Active Bezeq fixed-line subscriber lines, MOU, and monthly ARPL - 2003 - 2009
Table 16 - Bezeq International outgoing calls market share - 2005 - 2008
Table 17 - HOT divisional revenue - 2006 - 2009
Table 18 - HOT domestic telephony subscribers - 2005 - 2008
Table 19 - NetVision 013 Barak revenue and profit - 2006 - 2008
Table 20 - 012 Smile Communications revenue and profit - 2005 - 2009
Table 21 - Xfone revenue and profit - 2006 - 2009
Table 22 - Fixed-lines in service and teledensity in Israel - 1995 - 2008
Table 23 - Jordan Telecom Group profit and revenue by sector - 2004 - 2008
Table 24 - Jordan Telecom Group divisional subscribers - 2005 - 2008
Table 25 - Fixed lines in service and teledensity in Jordan - 1995 - 2008
Table 26 - Fixed lines in service and teledensity in Kuwait - 1995 - 2008
Table 27 - Fixed lines in service and teledensity in Lebanon - 1996 - 2008
Table 28 - Telephone network statistics in Oman - May 2009
Table 29 - Omantel fixed-line ARPU - 2003 - 2008
Table 30 - Omantel financial data - 2003 - 2008
Table 31 - Fixed lines in service and teledensity in Oman - 1995 - 2009
Table 32 - Postpaid and prepaid fixed-line subscribers in Oman - 2005 - 2009
Table 33 - Qtel group mobile and fixed-line revenue and net profit - 2005 - 2008
Table 34 - Qtel Qatar mobile and fixed-line revenue and net profit - 2005 - 2008
Table 35 - Qtel Qatar fixed-line subscribers and ARPU - 2007 - 2009
Table 36 - Fixed lines in service and teledensity in Qatar - 1995 - 2009
Table 37 - Mobile, fixed-line and total telecommunications services revenue in Saudi Arabia - 2001 - 2007
Table 38 - STC Group revenue and profit - 2005 - 2008
Table 39 - Fixed lines in service and teledensity in Saudi Arabia - 1994 - 2008
Table 40 - STE Revenue by sector - 2005 - 2007
Table 41 - Fixed lines in service and teledensity in Syria - 1995 - 2008
Table 42 - Turk Telekom revenue, profit and EBITDA - 2007 - 2008
Table 43 - Turk Telekom fixed-line revenue, EBITDA and PSTN ARPU - 2007 - 2008
Table 44 - Fixed lines in service and teledensity in Turkey - 1995 - 2008
Table 45 - Etisalat group revenues and divisional representation - 2005 - 2009
Table 46 - du revenue and profit / loss - 2006 - 2009
Table 47 - Fixed lines in service, teledensity and subscribers by operator in the United Arab Emirates - 1995 - 2009
Table 48 - Fixed lines in service and teledensity in Yemen - 1995 - 2008
Exhibit 1 - Middle East regulatory authorities - September 2009
Exhibit 2 - Major fixed-line operators in the Middle East - September 2009
Exhibit 3 - Major submarine cable networks in the Arab Middle East - September 2009
Exhibit 4 - National and regional fibre networks in Egypt

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