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Middle East moving towards higher broadband penetration

JEDDAH — The Middle East region is making a strong push towards higher broadband penetration, according to a report released by researchandmarkets.com.

The ‘Middle Eastern Digital Media, Broadband and Internet Market’ report said the young population will be the one of the main drivers of growth as they grow up with Internet use. In addition, liberalisation and increased competition are producing a greater variety of services and mediums, the report noted.

While broadband growth has taken off, wide income disparities across the Arab Middle East region as a whole are echoed by wide disparities in Internet and broadband penetration rates, the report said.

Qatar, Bahrain and the UAE all have high household broadband penetration rates, particularly among nationals. Saudi Arabia, 
the largest country in the region, has low broadband penetration but it is rising quickly.

ADSL is still the prevailing broadband Internet technology in the region, though much is being promised by WiMAX.

In Bahrain, services from Zain Bahrain and Mena Telecom, both with country-wide networks, have rapidly gained over 30 per cent market share. It is also having a significant impact in Saudi Arabia and Jordan.

All the GCC and Turkish operators offer HSPA mobile broadband services. Saudi Arabia’s second mobile operator Mobily has claimed a 70 per cent share of the country’s broadband market.

The report noted that one of the reasons for slow Internet and broadband subscriber growth in Arab Middle East countries has been a lack of sufficient content in Arabic.

At least 60-70 per cent of homes across the Middle East have access to multi-channel TV, much of it free to air DTH satellite. Around 70 per cent of the 400 plus channels are privately owned, the report said.

According to the report, the broadband sector received a further impetus from the sale of Jordan’s Maktoob to Yahoo. This immediately prompted venture capital funds to take a greater interest in the sector.

Advertising now provides only a very small revenue for digital media companies. The UAE’s advertisers allot only 3.5 per cent share of their budgets to online advertising compared to a regional average of one per cent, the report said.

· habib@khaleejtimes.com