Dubai: The UAE’s telecommunications sector reported a 6.57 per cent increase in revenue to Dh29.18 billion last year compared to Dh27.38 billion in 2012, fuelled mainly by growth in mobile services, according to Telecommunications Regulatory Authority’s fifth ‘Annual Sector Review’ published on Thursday.
The report summaries the state of the fixed, mobile, and data telecommunications markets in the UAE in terms of subscribers, penetration rates, revenues, and usage between 2010 and 2013.
The number of active mobile subscriptions by both etisalat and du crossed 16 million last year with a penetration rate of 192.9 per cent, one of the highest mobile penetration rates in the world while revenues generated from mobile services has been progressively increasing and increased by 6.3 per cent in 2013. The majority of the revenue increase came from postpaid services which increased by nine per cent from the previous year.
In 2013, postpaid subscriptions accounted for 13 per cent of total mobile subscriptions. The fall in penetration levels between 2011 and 2012 was due to changes in the population estimates for the UAE.
The total number of SMS and MMS messages sent during 2013 decreased by 13 per cent and 23 per cent respectively when compared to 2012.
“The report highlights the continued development of the telecommunications sector of UAE. The sector continues to experience significant growth with the period from 2010 to 2013 building on the positive sector development seen in 2008 to 2011,” said Mohammmad Al Ganem, Director General of the Telecommunications Regulatory Authority.
Given the fact that a large majority of subscribers are prepaid payment plans, Bhanu Chaddha, telecommunications research manager at International Data Corporation (IDC), said that the sweet spot for telecom operators is the mobile data.
Fixed telephone lines
He said the outlook for the UAE telecom market is very positive as tourism and hospitality sector is growing in the Emirate and due to Expo 2020, population is expected to grow robustly.
The report said that number of residential fixed telephone lines increased by nine per cent between 2012 and 2013 over 2.08 million and number of business lines by two per cent. The fixed line penetration rate in 2013 stood at 25 per cent.
“Fixed telephony revenues declined by 0.8 per cent between 2012 and 2013. However, it is important to note that these revenues do not include any line rental revenues from double play [fixed line services bundled with broadband] or triple play [fixed line services bundled with broadband and TV] subscriptions. Therefore we would expect reported line rental revenues to fall as consumers migrate from single play to double/triple play packages,” report said.
International voice revenues fell by 13 per cent in 2013 while domestic voice revenues fell by four per cent. Calls to mobile phones represent the largest proportion of fixed line call minutes.
Calls to Pakistan, India, Egypt and the Philippines represented 55 per cent of total outgoing international traffic in 2013 while calls from Saudi Arabia and India represented 70 per cent of the top 10 countries in incoming traffic in 2013.
Subscribers
There has also a marked trend of customers subscribing to higher speed Internet services over time. For example, in 2010 less than one third of the residential customers had internet speeds of more than 4 Mbps but by the end of 2013, more than two thirds of subscriptions were at these higher speeds.
“The many positive trends illustrated within the review is testament to the strategic vision and operational expertise of etisalat and du, and also to the continued oversight of the sector by the TRA. I was particularly encouraged by the performance of the internet services segment and the fact that subscribers are taking advantage of the high speed, advanced networks that the operators have invested heavily in over the past years,” Al Ganem said.
As of December 2013, there were 1.04 million internet subscribers in the UAE and the total number of broadband subscribers increased by 9.1 per cent between 2012 and 2013. The penetration level of broadband was 12.5 per cent as at December 2013.
