The provision of fixed broadband services in the Middle East (ME) has been historically linked to high entry barriers and too little competition to stimulate enough technology and market push, resulting in low household penetration rates. In 2011, a series of civil unrests collectively known as the “Arab Spring" temporarily slowed down the growth of the telecom sector with delays in planned roll-outs and privatisation measures as investors' confidence in several ME markets dropped. However, the fixed broadband base in ME continued to show signs of potential with two-digit subscriber growth rates by the end of 2011.
This article analyses the fixed broadband landscape in five selected markets in ME, namely Egypt, Israel, Jordan, Saudi Arabia and the United Arab Emirates (UAE). In addition to being two of the largest economies within ME, Israel and the UAE also have the highest fixed broadband household penetration rates within the region. Meanwhile, incumbents Telecom Egypt and Saudi Telecom Company (STC) do not compete directly with other players in their respective home markets and so there are hardly any offers via platforms apart from the copper network. Lastly, Jordan was also examined as a special case in light of having a rather liberalised market in the region, in particular with France Telecom Group owning 40% of the incumbent Jordan Telecom, the highest share by any single foreign telecom operator in ME.
Background and objective
Middle East region profile
Technology platform competition not evident in ME fixed broadband market: mainly xDSL
Israel Regulator targets to link 100% of population to 100 Mbit/s broadband speed by 2020
UAE’s free zones and New Dubai seen to further expand market for fibre-based broadband services
Saudi Telecom FTTH significantly gaining ground along with WiMAX and mobile broadband
Jordan toils to meet “Silicon-Valley" typecast
Second fixed line operator to bid in 2013, break monopoly of Telecom Egypt