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BMI View: The MENA telecoms markets are at very different levels of development, from the saturated and data - intensive markets of the GCC to the emerging markets in the region . As the potential for organic growth is limited, operators aim to migrate customers onto more advanced plans, and upsell new services as part of a convergent strategy. We believe growth will be uneven across the r egion, with the more mature markets expected to grow at a slower pace as there are fewer opportunities for subscription growth, while the emerging markets present the biggest opportunity for long-term growth. However, the r ising security ris k, fiscal consolidation and further falls in oil prices paint a bleak macroeconomic outlook across the MENA region for 2016, which will in turn impact on the telecoms sector through increased operating costs and slower demand for new services.
|Convergence To Drive Regional Broadband And 3G/4G Growth|
|MENA Telecoms Forecast, 2014-2020|
|f = BMI forecast. Source: BMI|
Latest Updates & Industry Developments
By the end of 2020 we expect the number of mobile subscriptions to rise to 559.4mn. Growth across the region will be driven by migration to 3G/4G services and by a trend towards the use of multiple SIM-connected devices. Although mobile subscription growth will be limited, we expect stabilisation to be offset by growing consumer appetite for mobile data services.
Fixed line subscriptions are expected to continue growing, with strong demand for multiplay services and wireline broadband connections. Fixed-to-mobile substitution and market saturation remain the biggest threats to continued fixed-line growth however.
We maintain a positive growth outlook for the broadband sector, based on continued investment in next-generation networks by GCC operators such as STC, Etisalat, Ooredoo and du. Although new investments in fibre-to-the-home (FTTH) will drive up fixed broadband services in the GCC, we expect mobile broadband to be the main form of internet access. By 2020 there will be 67.7mn broadband subscribers, up from 52.4mn at the end of 2015.