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Jordan Telecommunications Report Q3 2011
Business Monitor International, June 2011, Pages: 96
Business Monitor International's Jordan Telecommunications Report provides industry professionals and strategists, corporate analysts, telecommunication associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Jordan's telecommunications industry
BMI's analysis of the Jordanian telecoms market this quarter incorporates market data published by the telecoms regulator the Telecommunications Regulatory Commission (TRC) and leading service providers. These are France Telecom-backed Jordan Telecom (Orange), Zain Jordan, Qatar Telecom (Qtel)- owned wi-tribe and Bahrain Telecom (Batelco)-owned Umniah. Our five-year forecast for the mobile, fixed and broadband sectors are largely unchanged this quarter as the latest market data are in line with our previous forecasts. Meanwhile, we are introducing our maiden ARPU forecast for the mobile market this quarter. Our forecast is based on available market data and overall trends in the telecoms market.
With the return of relative calm to Jordan's political scene after protests for political reforms in early 2011, the country's telecoms sector is repositioning itself to restore investor confidence and attract funds for expanding and upgrading the network. In our previous report, we suggested potential investors are likely to be hesitant about committing to long-term investments until political stability returns to most countries.
Although Jordan boasts relative stability, we note it is not insulated from the wider impact of political unrest in the Middle East and North Africa. However, it is noteworthy that increased government spending is likely to bolster private consumption and by implication, subscription to higher value telecoms services. We expect increased subscriptions to the high-value service of data, particularly over wireless networks. Mobile market leader Zain launched 3G network services in March 2011 to break Jordan Telecom's monopoly of the market. We expect competition between Zain and Orange, Zain's rapid network expansion plans and the increasing availability of low-cost 3G-enabled devices to boost the take-up of 3G services. Meanwhile, there is an increasing awareness of 3G networks as social networking sites such as Twitter and Facebook and video streaming sites such Youtube. These played a key role in mobilising people for anti-government protests across the Middle East and North Africa and are accessible over 3G networks and with mobile devices. We therefore have a positive growth outlook for Jordan's 3G market and expect it to account for up to 25% of total mobile subscriptions by 2015.
BMI calculates Jordan's mobile market grew by 7.1% y-o-y to reach 6.964mn subscribers at the end of 2010. This reflects a market penetration of 114%. Our figures are based on market data published by the three major mobile operators and estimates for iDEN operator Xpress. The official figure from the TRC is slightly lower because the regulator does not include subscriber numbers for Xpress. Again it seems the regulator uses a much more metric way of counting active subscribers and resulted in disparity between its figures and those of mobile operators Zain and Umniah. During the next five years, we expect Jordan's mobile market to remain in an uptrend, albeit with lower growth rates towards the end of our forecast period. By 2015 we expect mobile penetration in Jordan to reach 133%.
The broadband market registered strong growth in 2010 with estimated net additions of about 77,000 customers, most of them on WiMAX networks. According to the regulator's data, the number of WiMAX subscriptions increased by 182% y-o-y to reach 92,490, while ADSL connections grew by 15.8% to reach 192, 846 subscribers at the end of 2010. Jordan Telecoms continues to dominate the ADSL market with a market share of more than 83%. Meanwhile Umniah and wi-tribe account for about 40% of the WiMAX market. BMI forecasts broadband penetration in Jordan to increase from 4.8% in 2010 to about 11.7% by 2015. Meanwhile, the growth of the broadband market, particularly WiMAX networks, is set to be the bane of fixed-line voice subscriptions. This will be through the use of VoIP services, which becoming popularity in Jordan. We therefore expect the decline of fixed-line connections to continue over the next five years, with penetration falling to about 6.8% by 2015.
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