Dubai:
A steady growth in population of nationals and
expatriates in the UAE will bring Dh35.27
billion revenue to the the telecom industry by
2012, report says.
Al Mal Capital Research analysts predict the UAE
population to grow at 4.8 per cent, taking the
current population of 4.6 million to 6.3 million
in 2012.
Led by population growth, the overall UAE
telecom industry's revenues is forecast to grow
at 8.5 per cent, expanding the market revenue
from Dh21.6 billion to Dh35.27 billion by 2012.
The overall telecom industry will significantly
boost the mobile market that, as end of 2007,
reports a subscriber total of 7.7 million.
In 2008, the number of active SIM cards will
surge to 9.2 million, and continue the
acceleration to reach 11.9 million subscribers
in 2012, according to market research.
etisalat recorded its mobile customers at 6.83
million, an increase of seven per cent compared
to end of 2007, and stated net revenues of
Dh6.383 million in the second quarter of this
year.
Recently, the telecom operator launched mobile
numbers with the prefix of 056, which currently
has 15,000 subscribers according to sources.
In the first quarter of 2008, du's mobile
customers reached 1.7 million but with 1.4
million active customers (a number from which a
call was made or SMS/MMS was sent or a call was
received in the last 90 days as per Telecom
Regulatory Authority [TRA] regulations),
according to company reports.
Revenues
The telecom operator's total revenues at end of
March were reported to be Dh756.5 million, at an
18 per cent increase from the previous quarter.
Mobile penetration rates are expected to grow
slightly from 166 per cent in 2007 to 188 per
cent by 2012, according to reports.
However, experts believe that mobile penetration
will be inflated due to certain factors.
Business visitors are inclined to use a local
SIM card and the high level of tourism
translates to an increase in mobile users as
they buy SIM cards for the duration of their
stay.
Researchers also believe attractive offers by du
is an incentive for many to open a du account as
a trial, while still maintaining their etisalat
account.
etisalat is said to have an 80 per cent share in
the UAE mobile market, but it could see a 10 per
cent decrease in local market as du is targeting
a 30 per cent market share by 2010, according to
Al Mal Capital Research.
"While etisalat should inevitably see its
domestic market share decrease, the company's
growth and profitability should be driven by its
rapidly expanding overseas operations," said
Irfan Ellam, equity research analyst at Al Mal
Capital Research.
etisalat is "aggressively expanding
international operations" in 15 countries and 36
million proportionate subscribers.
"Once du completes its mobile network rollout,
we expect genuine increased competition within
the UAE between the two players, although it
will be based less on direct price competition
and more on special offers and promotions,"
Ellam said.
The overall Middle East telecom markets are
reaching saturation levels, according to a study
by Booz and Company.
The sector witnesses a compound annual growth
rate of 44 per cent between 2003 and 2007, with
subscribers increasing from 24 million to 103
million.
More operators are coming into the markets,
while others are expanding geographically.
Gassan Hasbani, vice-president, Booz & Company
said, "Going forward, high growth levels will
become increasingly difficult to sustain by
relying only on traditional expansion. So, cross
border consolidation is expected to become
increasingly common in the region."
Fact file
etisalat
050 mobile prefix: 6.82 million subscribers
056 mobile prefix: 15,000 subscribers
du
055 mobile prefix: 1.4 million active
subscribers
Dubai:
A steady growth in population of nationals and
expatriates in the UAE will bring Dh35.27
billion revenue to the the telecom industry by
2012, report says. 
