IDC publishes Middle East telecoms trends for 2010

mobile_phone.gifI recently came across analyst firm, IDC's view of the top trends for the Middle East telecoms market for this year. They make interesting reading, with much of the focus on mobile services, broadband and the SMB market so I thought I'd share some of their views here.

IDC expects the Middle East (ME) telecommunications market to be characterised by regulatory developments and continued investment in broadband infrastructure, a cloud computing revolution and further advances in mobile and other technologies during the course of this year. That to me makes it sound much the same as any other market in the world. However, the analyst firm expects economic recovery in the entire region in 2010, with around 3-4% year-on-year growth and I suspect that will prove to be quite a rapid bounce back. Qatar is expected to record especially healthy year-on-year growth - of almost 20% - in 2010, primarily from strong natural gas exports. With broadband penetration at just 3%, ecommerce participation in a few markets remains in single digits, which may be due in part to a lack of relevant local content. That headroom, for me, suggests we'll see greater growth in the region than in more mature markets.

Key areas identified by IDC include:

Mobile Services - There has been a surge in traffic used for internet-based services such as social networking, location-based services, navigation, local search, instant messaging, and other applications, and thus the revival of mobile handset markets will continue, says IDC, with a rising share accounted for by smartphones.

Mobile Broadband - Increased usage of mobile broadband services will remain the dominant trend in the developed ME markets. In Saudi Arabia, mobile broadband already seems set to replace DSL as the technology most subscribed to for access to broadband services, but both services will co-exist and complement each other, as DSL and other cable-based broadband access technologies - such as fiber to the home - can still provide better options for delivering IPTV and video-streaming services.

Mobile Payments - eGovernment initiatives will drive growth in mobile payments, as well as additional partnerships between telcos, solution providers, and governments for more innovative solutions in the mobile payment segment.

The SMB market - Providers are starting to focus more on small and medium-sized businesses (SMBs), via bundled, managed ICT services. Cost savings and security will likely be main factors for telcos in the SMB segment and, as operators in the region have long been looking at ways to create new growth through value-added or new media services, they will also start to move further into the adjacent industries of media, finance, and IT services as they seek new growth platforms.

Government Initiatives - The market is likely to see tariff realignments in wholesale and retail markets, aided by ongoing investments in both national and international telecoms networks across the region. With existing and new companies investing to build their networks to accommodate higher bandwidths, the emerging bandwidth availability should drive down wholesale and retail access prices.

Anthony Plewes

After a Masters in Computer Science, I decided that I preferred writing about IT rather than programming. My 20-year writing career has taken me to Hong Kong and London where I've edited and written for IT, business and electronics publications. In 2002 I co-founded Futurity Media with Stewart Baines where I continue to write about a range of topics such as unified communications, cloud computing and enterprise applications.