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Gulf telcoms bet on data as growth ebbs
Telcos face numbers challenge as only a sixth of subscribers access data through handsets even as the UAE posts the highest mobile penetration in the world.
May 18, 2011 5:34 by Reuters
Operators could create new business models more reflective of actual network usage, upping data charges and slashing voice tariffs, said Martin Mabbutt, Nomura telecoms analyst.
“The difference in voice and data pricing is just a legacy of history,” he said. “Data revenues will inexorably rise. Fundamentally, it’s a question of increasing the number of data users. All customers are using their phones for voice, but only a fraction are using data beside SMS.”
Vodafone Qatar appears to have found a way to navigate from voice to data without much of the pain that its regional peers appear to be experiencing.
Like du, Vodafone Qatar, which began operations in 2009, has targeted low-income residents. The operator offers subscribers free access to social networking sites such as Facebook and now has a 45 percent share of the Qatar market and a 25 percent revenue share.
Vodafone Qatar users also get 10 megabytes of free data per month if they recharge at least once and more than half of subscribers now use mobile internet.
“Data usage is through the roof,” said DeEtte Christie, Vodafone Qatar head of online. “In a market like Qatar, the majority don’t have access to a PC, but everybody has a cell phone. By giving customers free megabytes, they become comfortable and adopt additional consumption. For many, the free megabytes are “training wheels” for the mobile web.”
The most popular sites are social media, followed by forums and community-generated content and news sites, both local and from expats’ home countries, said Khalifa Saleh Haroon, Vodafone Qatar head of online and corporate strategy.
“You can get online on low-end handsets now, even a poor 2G Handset,” added Christie. “It might not be the experience you or I want, but for someone where this is the way they can talk to their friends and family back home, they are going to do it.”
Saudi Arabia, on the other hand, is a unique market where mobile broadband services have made significant inroads, due to poor fixed internet access across the kingdom.
For every three mobile phone users, there are two for mobile broadband subscriptions — the sixth highest ratio globally — according to data by the International Telecommunications Union.
Saudi Arabia’s conservative social and religious rules — women are not allowed to drive and mixing with the opposite sex is strictly controlled — have fuelled this demand for value-added mobile services.
BlackBerry Messenger and Facebook are often the easiest way for Saudi Arabia’s young population — about two-thirds are under 30 — to communicate, a fact not lost on Etihad Etisalat (Mobily), with data accounting for about 18 percent of the operator’s revenues last year. Mobily also has a 70 percent share of Saudi Arabia’s mobile broadband market, with more than a tenth of its 22 million subscribers also active data users.
“Our growth is fuelled by that (mobile data) — how much more can you charge for phone calls?” said Medhat Amer, Mobily chief information officer. “We have created new usage scenarios by promoting smart phones aggressively.” (By Matt Smith; Editing by Reed Stevenson and Mark Heinrich)
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