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3G to reach 40% of Saudis in four years time - Reportlinker

Reportlinker has announces their new market research report on the Saudi Arabian telecoms market. Looking towards 2014, Reportlinker is confident of major growth in the Saudi 3G sector.

Reportlinker’s Saudi Arabia Telecommunications Report Q1 2010 contains newly revised and extended forecasts for the country’s fixed-line, broadband and mobile telephony markets. The forecasts extend to the end of 2014 and incorporate second and third quarter data published by the country’s telecoms regulator, the Communications and Information Technology Commission (CITC), as well as mobile operators Saudi Zain and Bravo (owned by Qatar Telecom [Qtel]). Based on the available regulatory and operator data, the research team has assessed how the Saudi telecoms markets performed in 2009.

 One estimate (by BMI) is that the Saudi mobile customer base grew by just over 20% in 2009. Growth in 2009 was only slightly lower than in 2008 when the market grew by 26.7%. The strong growth in 2009 was partly due to the launch of commercial operations by Zain in late 2008.

Saudi Arabia’s high mobile penetration rate, which had exceeded 177% by the end of 2009, can be explained with reference to the country’s two largest mobile operators, Saudi Telecom Company (STC) and Mobily (owned by Etisalat of the UAE). These operators are thought to harbour a large number of inactive prepaid users on their networks.

BMI estimates that over 13% of Saudi mobile telephony customers had 3G handsets at the end of 2009. By the end of 2014, it predicts that the proportion of 3G users will have risen to almost 40%. Given that the Saudi market contains a large number of multiple SIM owners and inactive prepaid cards, the number of Saudis with a 3G handset is likely to be significantly higher.

Based on an assessment of the latest regulatory data, Reportlinker estimates that the Saudi fixed-line sector grew by 3.9% in 2009, and that the bundling of a fixed-line service together with a broadband subscription could be one of the reasons for the continued fixed-line growth in 2009, at least among residential customers. Demand for traditional fixed voice services from business customers appears to remain relatively robust.

Meanwhile, the latest set of regulatory figures show that the number of Saudi broadband subscribers had risen to 1.839 million by the end of June 2009, equivalent to 7.5% of the population. The broadband penetration rate had risen to 9.5% by the end of 2009. One of the biggest factors driving subscriber growth in 2009 was the continued expansion of competition.

* This quarter sees the introduction of a new set of a new set of Business Environment Rankings for the Middle East. Following Reportlinker’s decision to reclassify Turkey as an Emerging Europe market, Turkey is no longer covered by its Business Environment Rankings for the Middle East. It has also added several North African countries to its Business Environment Rankings for the Middle East to form a combined Middle East and North Africa (MENA) table. Although Saudi Arabia’s own score remains unchanged this quarter, the country has risen from third to second position in the rankings: this change of position is due to the weaker performance registered by Bahrain.

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