Archive for March, 2017

Jordan’s mobile market well serviced by three strong players

Tuesday, March 28th, 2017

Three major mobile network operators offer services across Jordan including Zain, Orange and Umniah, as well as an MVNO, Virgin Mobile MEA. The market is highly competitive with the three major operators all having over 30% market share each, in terms of mobile subscribers.

Mobile broadband is a key growth area for Jordan, with 4G services already on offer. By 2020 4G penetration could reach as much as 70%. Orange Jordan has seen recent growth in subscriber numbers due to the more competitive mobile broadband services it can offer as a result of 4G deployments.

The fixed broadband network is also growing and the government has been working for some time to deploy its national broadband network. Public facilities are being connected, with deployment to the Southern governates expected to be completed by the end of 2017. Work has also begun on the Northern governates.

Jordan is host to a growing number of ICT companies and has emerged as a technology start up hub for the Middle East, made possible due to a focus on ICT education and a regulatory environment conducive to ICT investment.

Jordan’s thriving start up scene has underpinned Jordan’s digital economy, which incorporates e-commerce, e-health, e-education and e-government. Most activity and attention is focused on the e-commerce sector given the commercial opportunities available. Tackling one of the largest impediments to e-commerce development in Jordan and the Middle East in general, the Central Bank of Jordan adopted a strategy for 2013 – 2017 to develop the legal framework for all e-payments systems in Jordan.

Jordan has placed a high priority on improving its government services and by January 2016 the Jordanian government was supplying 100 services electronically, with plans to launch a further 100 e-services during 2016/2017 and another 150 during 2018/2019.

The combination of a future national broadband network along with 4G LTE services and a highly competitive market will spur the overall telecoms sector on in Jordan and it is hoped that revenues for the sector will increase substantially.

For detailed information, table of contents and pricing see: Jordan – Telecoms, Mobile and Broadband – Statistics and Analyses

 

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Rhineland economic model is closest to smart city developments

Monday, March 27th, 2017

It is interesting to compare the major economic models in the western world – the American Anglo-Saxon model, the European Rhineland model and the Scandinavian model.

The Anglo-Saxon model is very much driven by small government, market-driven economic and social policies, and in general has a large focus on shareholders value.

By contrast the other two models operate more in accordance with the so-called triple-bottom-line; a more equal focus on combined economic, social and ecological outcomes. The Scandinavian model goes the furthest with a very high level of government involvement in all sectors of the economy and the society – all the basic  elements of life are fully looked after (education, healthcare, social welfare, childcare, old age pension; but also public transport and other essential infrastructure). Obviously this is reflected in higher taxes, but people in these countries clearly see the value of their socio-economic model as it provides peace of mind throughout their lives. As is clear in the recently published World Happiness Report – the annual UN survey that looks at ‘happy citizens’ – the Scandinavian countries consistently score the highest results, despite their high tax regime. This year Norway is number one, Denmark 2, Iceland 3, Finland 5 and Sweden 9. The latter shares this position with Australia. The USA came out in 19th place.

The Rhineland model is perhaps best described as a socio-democratic adaptation of the capitalist Anglo-Saxon model, with clear hybrid characteristics, for example in countries such as the Netherlands. Both the Rhineland and the Scandinavian model are based on the broader stakeholders value and not just on shareholders value.

While in the current political climate the Australian federal government’s focus is still very much geared towards the Anglo-Saxon model, the story is completely different at a city and community level. When I travelled with the Dutch-led Global Smart City and Community Coalition (GSC3) through Australia earlier this month, I was very surprised that all nine Australian cities we visited voluntarily talked about the need for a triple-bottom-line approach regarding their smart city developments. I had hardly ever come across this language in my discussions with private industry.

Having said that, the tide is turning. Private industry has now been talking with cities for several years regarding their options to assist them in building smart cities with the aim of selling their ‘smart city wares’. In general, many of these companies – especially American-based multinationals – haven’t got very far, since their own business models don’t match the ones that the cities use. Some involved in the most pure form of the Anglo-Saxon model have actually left the market or significantly scaled down their operations in this segment, as their activities didn’t deliver the shareholders value they were after. Their model still largely depends on the next quarter’s results and this doesn’t fit the smart city model, which looks at results over much longer periods.

Cities and communities operate at a very different level. They need to deliver to all of their stakeholders, who in turn are all citizens of their communities, and in doing so they are not profit-driven. Happy citizens mean a well-functioning city in all aspects of life. The abovementioned happiness ratings also correlate with the high-functioning societies of, for example, Scandinavia. The companies that understand the need for a holistic approach to smart cities also recognise the need for business models based on the triple-bottom-line concept. This is not always easy as, while the people involved in smart cities within the companies selling smart city products and services might understand that message, the companies themselves might not yet be geared up for such an approach within their current business models. However in the Australian Smart Communities Association (ASCA) – led by some 150 cities and communities around the country – an industry board has been established of companies that do subscribe to this triple-bottom-line approach, and that are willing to place the wellbeing of the citizen central in their discussions with the cities to develop long-term sustainable business and funding models for the development of smart cities.

Coming back to the GSC3 trip around the country, it was therefore no wonder that the GSC3 approach towards smart cities (more based on the Rhineland economic model) totally resonated with the cities they visited in Australia. International collaboration within this model is therefore a perfect fit for the leading smart cities around the globe, all of whom are already working from that model. At the same time the alliance provides an example for other cities that still have a way to go in their journey towards smart cities.

And the good thing about cities is that they are very happy to share their knowledge, experience and insights with other cities around the world. This enables cities to learn from each other, sharing knowledge and insight, and even working together on smart city projects – each taking care of certain use cases within the project. This not only saves costs but also speeds up the implementation.

This video clip gives a nice insight from an Australian perspective into this international collaboration model.

Paul Budde

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USA’s mobile operators fast-tracking 5G developments

Monday, March 27th, 2017

The US has one of the largest telecoms markets, which has given it a unique character based only regional licensing. Growth in the mobile subscriber base remains strong despite penetration levels of above 120%. Declining revenue from voice services is compensated for by high growth in mobile data use, itself supported by upgraded networks supporting LTE-based services. Smartphone penetration is also high, which also encourages mobile data use among subscribers. A number of operators, led by AT&T, have partnered with vendors to trial 5G technologies and services. AT&T aimed to develop commercial 5G services by late 2018, which would make it one of the firs carriers globally to do so. In addition, operators are working on the potential of NB-IoT, LTE-U and LTE-A technologies, in some respects as a precursor to 5G.

A major development in early 2017 was the complex reserve auction for spectrum in the 600MHz band, which raised more than $19 billion. Although network operators must wait for spectrum allocations to be concluded, the additional 70MHz made available will go far to supporting mobile broadband in rural areas, and improving network capacity.

Given the size of the US market, and the growing demand for data on both fixed and mobile networks, there is continuous pressure for operators to invest in fibre networks, and to push connectivity closer to consumers. In recent years the US has seen increased activity from regional players as well as the major telcos and cablecos. Much of this activity was stimulated by Google Fiber following its investments in a number of markets. Although Google Fiber began scaling back its efforts in late 2016, the company’s legacy has been profound. It encouraged the major providers to reduce pricing for their similar offers, stimulated interest among municipal leaders, and highlighted the fact that haphazard and potentially duplicated fibre deployments are no effective substitute for municipally-led wholesale fibre infrastructure accessable to any provider.

AT&T and Verizon have shifted their investment efforts from a hybrid fibre-copper architecture to pure fibre. AT&T expected to provide a 1Gb/s FttP service to 12.5 million premises by 2019, with a view to upgrading to XG(S)-PON within a few years. For its part, Verizon had a patchy experience with its FttN rollouts and so has chosen to switch deployment to FttP. At the same time a growing number of cablecos have launched DOCSIS3.1 services, able to provide data at 1Gb/s and above. Future HFC technologies promise considerably faster speeds in the years ahead.

This report provides analyses as well as key statistics and forecasts on the US mobile market, including CTIA data for 2015, telcos’ financial and operating data to Q4 2016 and recent market releases from the regulator. It also provides an assessment of telcos’ strategies, regulatory policies, and developments in the deployment of emerging technologies. The report also reviews the cable, DSL, Wi-Fi, WiMAX and fibre broadband markets, providing analyses on regulatory measures and an assessment of the major fibre deployments in progress.

For detailed information, table of contents and pricing see: USA – Telecoms, Mobile, Broadband and Digital Media – Statistics and Analyses

 

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Mobile Broadband Driving Vietnam’s Internet Growth

Saturday, March 25th, 2017

After peaking in 2009 Vietnam’s fixed line market in Vietnam has seen a significant decline. Market penetration has fallen from 20.1% in 2009 to 10.5% in 2012 and 5.7% in 2016.

In the meantime, having come late to the internet, Vietnam is finally embracing the higher access speeds offered by the various broadband platforms. Although there has been a surge in subscriber numbers, fixed broadband remains a relatively small but expanding market segment. Most significantly, the arrival of mobile broadband has seen widespread access to faster internet speeds.

Vietnam’s mobile market has grown strongly over the last decade, evidence that the competition model the government has put in place, although with some limitations, has been working. At the same time, demand for new mobile services appeared to have dropped and growth had generally slowed. There has been a gradual shift to value added services, with the arrival of 3G and 3G+ and ahead of the launch of 4G.

The highly competitive nature of Vietnam’s mobile segment is due in no small part to it being opened up to new players, importantly including some with no involvement of the state-owned VNPT. As with most other Asian mobile markets, growth in Vietnam was boosted by the early introduction of prepaid mobile services and prepaid remains a vital component of the business today.

Viettel is the largest mobile operator in Vietnam with over 40% market share, followed by MobiFone VTNL-Vinaphone and Vietnamobile. The Vietnamese mobile market has shown moderate growth over the past few years, increasing from mobile penetration of 135% in 2013 to 147% in 2016. However over the past two years the market has reached a saturation point, as mobile growth slow significantly. Further slow growth is expected to continue over the next five years to 2021. By that time penetration is expected to reach over 150%.

The initial roll-out of fixed broadband services win Vietnam as followed by a strong surge in growth; however, broadband remained a small but expanding market segment. It needed a stronger market focus by the providers; this seemed to have finally happened with the arrival of mobile broadband. As with other developing markets in Asia, there has been major shift in Vietnam’s broadband market with the widespread adoption of mobile broadband, with lower tariffs, ready availability and the convenience of mobility being the big attractions. Mobile broadband has been growing strongly in Vietnam over the past five years. Penetration has increased from 14% in 2011 to 31% in 2014 and 43% in 2016. Further strong growth is predicted over the next five years to 2021.

The fixed broadband subscriber market in Vietnam has been growing moderately over the past few years from a relatively small base. Penetration has increased from 6% in 2013 to 8% in 2015 and 9% in 2016. Fixed broadband penetration is predicted to grow moderately over the next five years, reaching between 14% and 17% by 2021.

Incumbent operator VNPT has been leading Vietnam’s charge into the broadband market. It has doing this largely as part of its Next Generation Network (NGN) development.

In the meantime, the digital economy in Vietnam has been flourishing, although its reach may not be as great as government policy would wish. The government has been the driving force behind the country’s move into the age of the digital economy. It has been constantly emphasising the need to use e-commerce to improve the country’s economic competitiveness. The government has also been particularly active in the development of cyber laws, no doubt because of its deeply ingrained political culture of central control. On another related front, Vietnam is moving quickly towards the digitalisation of TV broadcasting. A strategy plan for conversion to digital TV should see the country’s television stations broadcasting completely digital by 2020.

For detailed information, table of contents and pricing see: Vietnam – Telecoms, Mobile, Broadband and Digital Media – Statistics and Analyses

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International expansion has strengthened the operations of many mobile operators

Friday, March 24th, 2017

In 2017 the global mobile market has its sights firmly set on the opportunities offered through mobile data as well as looking for potential new revenues streams presented by the enterprise sector, data mining, 5G and international expansion.

Mobile saturation has occurred in many of the developed markets and this has forced some of the operators to look for new opportunities – particularly those offered by expanding regionally or internationally. This has occurred in most regions of the world – and as a result some operators have become powerful and dominant regional leaders.

In Latin America, for example, the mobile market continues to be dominated by a small number of operators which each have businesses in multiple countries.  These include Telefónica Group; Mexico’s América Móvil, trading as Telcel in its domestic market and as Claro in the remaining 16 markets in the region; Telecom Italia, AT&T Mexico and Millicom International. The dominance of these operators is being gradually eroded however as a result of efforts by a number of national regulators to facilitate the entry of MVNOs and to encourage the participation of smaller players in spectrum auctions.

In the more developed markets of Asia, growth is shifting away from a focus on subscriber numbers  and towards the expansion of new generation platforms and increased data usage driven by value-added services and increased ARPUs. There are those companies such as SingTel, Vodafone, and Axiata (formerly Telekom Malaysia International) that have built a substantial presence around the Asian region beyond their own domestic market through their shareholdings in operators in multiple other markets.

In the Pacific region; the Australian mobile market is dominated by the three major mobile network operators Telstra, Optus, and Vodafone (VHA), though there are numerous MVNOs which have a significant market share. These have been able to offer LTE services on a wholesale basis since early 2016, thus encouraging growth in the LTE sector and cementing the role which MVNOs play in the overall market.

Fiji is one of the telecoms leaders in the South Pacific region, along with Papua New Guinea. Similar to many developing nations, it is heavily reliant on mobile technologies rather than fixed lines. The percentage of unique mobile subscribers in Fiji sits at around 69%. Vodafone Fiji Limited (VFL) and Digicel Fiji are the major mobile operators and the only MVNO is Australian company, Inkk Mobile which operates on VFL’s network.

Three mobile service operators provide services in Papua New Guinea including Digicel, Bmobile (Vodafone), and Citifon (Telikom PNG). However, in February 2017 it was announced that Dataco, Bmobile and Telikom PNG would be merged together to form Kumul Telikom. The three entities would be able to share resources and infrastructure, making it potentially more cost effective and competitive.

Although there are a large number of network operators across the African continent, and also smaller niche MVNO players, there are also a small number of pan-regional network operators. These include Millicom, Orange Group, Vodacom and Bharti Airtel. Some rationalisation of their operations continues as these players adjust their strategies to fit in with market positions and expectations.

There are a number of companies which have a large presence in the Middle East. Zain, Ooredoo and MTN are three examples of companies operating in multiple markets and the international players of Orange and Vodafone also operate in region.

As with Latin America and Africa, the European region is notable for having half a dozen pan-European operators with interests in several key markets. These main players include Deutsche Telekom, Telefónica, Vodafone Group, Hutchison and TeliaSonera. There has been much jostling among these operators as they seek to strengthen their presence in particular markets. This has in turn caused some disquiet among national regulators and European competition authorities, which are keen to preserve a quorum of key players (generally four) within a given market.

This BuddeComm publication provides a global overview of the mobile market, supported by statistics as well as an overview of the mobile markets for each major region of the world. Country case studies for each region are also included, along with identification of the major MNOs and MVNOs operating in each region/country.

For detailed information, table of contents and pricing see: Global Mobile Operators – Regional Leaders – Overview and Statistics

 

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