There were 4.962mn mobile subscribers in Kuwait at the end of December 2011, meaning the market grew by 11.5% during 2011 to bring the mobile penetration rate to 176.1% at the end of 2011, up from 162.6% a year earlier. Based on data published by Zain and Wataniya, and estimates for third-ranked VIVA, BMI believes the market grew by 1.8% during Q112 to reach 5.051mn subscribers.
Kuwait’s mobile market is expected to remain on a positive growth trajectory, driven by population growth and constant stream of tourists, expatriates and other visitors. By 2016, the number of mobile subscribers in Kuwait is forecast to reach 6mn, equivalent to a penetration rate of around 193%. The discounting of inactive lines and a reduction in the incidence of multiple ownership are the biggest threats to this growth outlook for Kuwaiti mobile market.
Following the rollout an LTE network by VIVA, Kuwait’s two biggest networks - Zain and Wataniya - have embarked on significant upgrades to their mobile data networks, including projects to prepare them for LTE upgrades. This development bodes for the operators’ ARPU, which has come under increasing downward pressure from competition, especially in the voice segment.
The development will likely drive growth in the broadband segment, which has long been held back by a lack of competition and limited investment in fixed network infrastructure. There were an estimated 410,000 broadband connections in Kuwait at the end of December 2011, a penetration rate of 14.5%; this is expected to rise to almost 1mn connections and penetration of more than 31% by 2016.
Some of the major developments in the market since our last report include plans by the Ministry of Communications (MoC) to issue new operating licences to internet service providers (ISPs), the launch of IPTV services by ISP FASTtelco, and the deployment of new value-added services by the mobile operators. VIVA has launched an HSPA+ mobile data network capable of providing speeds of up to 42.2Mbps. The operator, which has made data a key part of strategy, reported a 47% year-on-year (y-o-y) increase in revenue in 2011 to KWD94mn.