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Mobile madness continues to sweep the Arab world

The region’s preference for mobile communications shows no sign of abating as Madar Research Group reports that 2002 witnessed a 52% increase in the number of mobile phone subscribers throughout the Arab world.

The region’s preference for mobile rather than fixed line communications shows no sign of abating. Evidence of this comes from Madar Research Group, which reports that 2002 witnessed a 52% increase in the number of mobile phone subscribers throughout the Arab world. At the end of November there were 23.7 million mobile users compared to 23.35 fixed line subscribers, while the former now outnumbers the latter in almost every Gulf country.

According to the research group, a number of factors have contributed to this growth, including the expansion of mobile networks and the introduction of new services throughout the Middle East and North Africa.

"The high growth in the number of mobile phone subscribers is due to network development and expansion projects by mobile carriers in many countries including Egypt, Jordan and Tunisia, in addition to new services such as prepaid mobile cards, the sales of which in Saudi Arabia alone reached 1.6 million since their launch in April 2002," says Abdul Kader Kamli, Madar’s president & research director.

Despite the region’s high growth rate, there is still much disparity in mobile phone penetration between Arab countries. For instance, the GCC displays penetration rates much higher than the world average, but it is still almost half that of the North American average. However, if the GCC is excluded from the equation, the Arab world has just over five percent mobile penetration.

"Mobile phone penetration in the Arab world… is still low. The 23.7 million mobile phone subscribers constitute only about 8% of the Arab population, compared with a world average of 17%. But the Arab world will catch up with the rest of the world in the coming three years as Arab countries liberalise their telecommunication markets and bring in more players and competitors," explains Kamli.

The growth of mobile adoption throughout the region reflects the current increase in handset shipments worldwide, which rose more than 5% in the third quarter according to recent research from In-Stat/MDR. Furthermore, the US-based analyst house suggests that shipments will grow more than 11% sequentially as newer models reach end-users at affordable prices.

However, despite the mobile market’s promise, In-Stat/MDR warns that the heady days of strong double-digit percentage growth may not return due to the number of challenges the mobile market still faces.

“Significant challenges still remain for handset makers, including the reluctance of end users, especially in Western Europe and North America, to spend beyond the $100 to $150 range for replacement models, [the] spotty rollout of high-speed networks, the lack of compelling new mobile applications, high penetration rates in developed countries, struggling economies around the globe and market uncertainty due to political/terrorist tensions,” says the analyst house.

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