Operators search for new revenue stream

With voice traffic unlikely to grow much further, regional operators are banking on data services to propel their revenue growth.

Karabatur also cites research claiming that Middle East and African operators will leverage the broader deployment of both cable and wireless technologies to drive non-voice revenues, acknowledging the GCC region and South African the biggest drivers in this segment.

"According to industry analysts OVUM, non voice revenues in the MEA region will grow from US $5.8billion in 2007 to US$9.5billion by 2010, representing a 13% compound annual growth rate (CAGR). This is compared to a 9% CAGR in Eastern Europe, a 6% CAGR in Western Europe and an 11% CAGR in Latin America," says Karabatur.

Telenity further claims that the MEA region is second only to the Asian market in this market segment in terms of profitability, with earnings before earnings before interest, taxes, depreciation, and amortisation (EBITDA) standing at 47% compared to 48% EBITDA in Asia.

With the UAE widely regarded as one of the most developed markets in the MEA region, due to its status as a regional business hub and population of early adopter end-users, the regional enterprise sector is looking towards network operators du and Etisalat to lead the market in terms of service provision.

Market newcomer du claims that market players must increase the levels of cooperation in order to boost content-based services such as WiFi and WiMAX.

"Roaming agreements on GPRS, 3G, WiFi across borders will help to foster data services especially among the business and leisure visitors to the region," claims a company spokesperson.

"One other element is the need to ensure standards in the devices that can provide access to non-voice applications, today this is a fragmented market," he adds.

Market incumbent Etisalat was the first network operator in the Gulf region to launch its Blackberry service to enterprise customers 12 months ago and claims that UAE businesses have responded so positively that it extended the service to incorporate leisure-users in 1Q07.

"After the success of the Blackberry service in the enterprise segment we have decided to implement a segmented approach with this solution," says Dr Sadik Al-Jadir, senior manager of markering [sic] for businesses at Etisalat.

The company claims to have leveraged Blackberry's reputation in the push e-mail segment to win over an additional 8, 000 consumers since its launch in February 2007 with an additional 1, 000 users taking up the service every month.

"We believe that this trend is being driven by the end-users who are utlising the service to access both work related data as well as personal e-mails," adds Al-Jadir.

Etisalat also claims that a process of localisation will prove a boon for the service in the segment. "We are currently working closely with Research in Motion (RIM) to be the first operator in the region offer this service on an Arabised platform in Q307," Al-Jadir says.

Jordan Fastlink agrees that localised content specifically targeted towards Arab and African audiences will encourage uptake of these services.

"Different segments demand different services to cater for their specific needs and requirements, which is why operators and their partners need to develop and work towards the customisation of their services and not just a simple plug and play solution and service. The consumer has a specific requirement, and so does the corporate sector. Integration with their backends and system is crucial for adoption," Al Masri says.

Additionally, the company argues that the development of this segment depends on several variables and that operators must be patient when it comes to expecting a return on their investment.

"Smartphone penetration across the region is crucial to the development of this segment, as are the levels of internet penetration which remains low in most markets in the MEA," asserts Al Masri.

With network operators in almost universal agreement that the enterprise segment will provide be the next driver for this market, due to its demand for ‘always on' e-mail connectivity, the next challenge appears to be how to broach the all-important consumer market.

Dubai-based Wireless equipment service provider Workz recently paired with multimedia company Mobile Streams in a bid to offer regional network operators premium content aimed at local audiences.

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