Dubai: Telecom operators can play a bigger role in boosting the demand for smartphones by lowering the prices of data packages, industry experts said.

Total handset sales in the UAE are expected to grow by 6.66 per cent this year to 3.2 million units compared to three million last year. In 2015, the market is expected to grow by mere 3.13 per cent.

“The main issue for the stagnant demand is due to the slow uptake of data packages when compared to the neighbouring countries,” Hamza Saleem, senior telecom analyst at research firm International Data Corporation (IDC), told Gulf News.

He said the share of smartphones out of all the handsets is 55 per cent compared to 45 per cent non-smartphones in the country.

“It is comparitively very small for a market like the UAE. The smartphone ratio is much higher in other countries. The smartphone ratio should be at least 60 per cent in the country,” Saleem said.

Only stumbling block

He said the smartphone demand should be higher and the only stumbling block is the high data packages in the UAE.

Data prices in the UAE are still the “highest in the Middle East and Africa region. Africa has the lowest data prices in the region and Egypt has the lowest rate in the whole of North Africa,” he said.

Etisalat offers 1GB data package for Dh99 and du charges the same data package for Dh100 in the UAE. Qatar Ooredoo charges 1.5GB for 25 Qatari riyals (Dh25.22) while Omantel charges 1GB for 5 Omani riyals (Dh47.70). Etisalat Egypt charges 1.25GB for 25 Egyptian pounds (Dh13.19).

Matthew Reed, principal analyst at Informa Telecoms & Media, also said that the UAE’s market is quite mature. The rate of mobile penetration in the UAE was 167 per cent at the end of third quarter of last year.

“In such a situation, inevitably growth rates “tend to slow,” Reed said.

Role of telcos

“Telcos have a much bigger role to play by offering cheaper data packages. They should lower the prices by half to see the real intake of data packages. If the data prices are cheaper, people will buy low-cost smartphones, instead of feature phones,” Salem said.

He said migrant workers will only go for feature phones and they use smartphones for Skype, WhatsApp, etc. Data is the only hurdle that is “hindering the growth.”

Reed sees the UAE mobile market does have the potential for further expansion, due to factors such as population growth and rising visitor numbers, as well as a continued increase in the use of mobile data services.

However, Saleem said the demand for feature phones will fall gradually in the years to come but that does not mean there is a big demand for smartphones. The fall should be faster.