Business | Telecoms
MEA's mobile user base to grow 10.5% annually till 2013
Mobile phone user base in the Middle East and Africa (MEA) is expected to grow at an average annual rate of 10.5 per cent between 2008 and 2013 and operator-billed service revenues across the region are expected to rise to more than $107 billion (Dh392.69 billion) in 2013, a research report said.
- By Naushad K. Cherrayil, Senior Sub-Editor
- Published: 23:17 July 12, 2008
- Image Credit:
Dubai: Mobile phone user base in the Middle East and Africa (MEA) is expected to grow at an average annual rate of 10.5 per cent between 2008 and 2013 and operator-billed service revenues across the region are expected to rise to more than $107 billion (Dh392.69 billion) in 2013, a research report said.
The report found that growth would be driven by mobile data services, fuelled by the greater availability and wider variety of media-rich content coupled with lower browsing costs.
However, it said that regional operator-billed voice revenues were likely to peak in 2011 and will subsequently fall away due to increasingly competitive pricing in that sector.
"The downward trend in regional average revenue per user (ARPU) will continue as adoption increases among lower-usage customers. We expect the decline in voice ARPU to be partially offset by an increase in data revenues, both among 2.5G and 3G customers," said Dr Windsor Holden, principal analyst with Juniper Research and the report's author.
He said the regional mobile phone market is expected to reach 485.9 million by end of this year, representing a year-on-year growth of 24.1 per cent from 391.6 million in 2007.
The report said mobile data services are expected to contribute 24 per cent of operator-billed service revenues in 2013, against just nine per cent in 2008.
Saudi Arabia is expected to provide the largest share of cumulative regional revenues over the forecast period, followed by Nigeria.
Dr Holden said the region was likely to witness a surge in the growth of mobile financial services, with a raft of operator-led payment initiatives such as M-Pesa and mobile banking providers such as Wizzit having already gained substantial user bases.
Infancy
He said within MEA, mobile advertising is still in its infancy. The market is dominated by SMS-based campaigns, which in 2007 accounted for about 82 per cent of regional adspend of just $29 million.
While adspend is expected to increase significantly in 2008, this is still very much attributable to continued utilisation of SMS-based campaigns, and reflects the realisation that many handsets in the region are entry-level; to attain maximum reach, campaigns are targeted accordingly, using a technology that most consumers can access.
"Indeed, SMS will remain the most popular campaign tool in the region throughout the forecast period, although by 2013 its share of adspend will have declined to 36 per cent as other delivery channels - most notably on-portal advertising gain in popularity.
Mobile content service revenues in the MEA are overwhelmingly dominated by ringtones, logos, and downloadable games.
"Saudi Arabia's 3G base of 3.1 million in 2007 was the 10th-highest in the world. The UAE, Saudi Arabia and South Africa accounted for nearly 94 per cent of the all 3G subscribers in the region in 2007, with the result that 3G penetration of all regional handsets stood at 2.7 per cent. UAE's penetration rates will exceed 50 per cent by 2010 and in Saudi Arabia by 2011," report said.
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