29 Dec 2008

HSPA subs growing in Saudi Arabia; market developments in slow-to-liberalise Kuwait

While I was moderating conference sessions at this month's GSM>3G Middle East conference in Dubai, I had the pleasure of introducing a representative of Saudi cellco Mobily to the audience.
Mohamed A. Radwan heads up the development of the MNO's chain of retail outlets and told conference participants about the company's approach to promoting all 3.5 G capabilities and VAS. According to the notes I made on the day, Mohamed did not share numbers regarding HSPA subscriber growth. I was therefore interested to see this question addressed in an edition of Global Mobile Daily last week. The Informa Telecoms & Media research service says that the number of Mobily's HSPA-based subscriptions has reached 300,000, having acquired this number of subs in the 18 months since launching a mobile broadband bundle in May 2007. Mobily charges SAR350 per month (USD 93.40) for the service and also has higher usage bundles on offer - 5GB for SAR200 and 1GB for SAR200.

The same issue of GMD picked up news of Kuwait's Ministy of Communications moving to reduce the cost of calling several European and Arab countries. The MoC has a free hand in such matters. The market is the least liberalised in the MENA region: fixed line network operations remain the exclusive preserve of the MoC itself and the Gulf state has no independent regulator.

The mobile space in Kuwait is rather more competitive, even more so since the September 2008 launch of Saudi Telecom-backed Viva, the country's newest cellco. It will be interesting to see how this third entrant fares on a market described in the abstract of my friend Paul Budde's country profile as having "[high] prices... across all sectors of the market" and a "comfortable duopoly enjoyed by Zain and Wataniya [which] has enabled them to build on their strong base to expand aggressively internationally to compete on a global scale."

Something I didn't know ahead of writing today's entry was that until very recently, Kuwaiti mobile users have had to pay to receive incoming calls. I just stumbled upon this personal blog, which reported earlier this month that Viva had broken the mould by implementing a pure Calling Party Pays model. From the comments which this entry prompted on the blog, it looks like Zain moved to introduce CPP a mere 12 hours later. I am not clear if Wataniya has done likewise or plans to do so. Warning: if you do follow the link to the blog which picked this up, prepare yourself for reader comments expressed in pretty strong language and people whose criticisms of Kuwait's operators are much less diplomatic than anything you will ever read here!

If this information is to be believed, it does suggest that Paul Budde's comment about a "comfortable duopoly" might not have been too wide of the mark - and that this duopoly has been quickly attacked by the new entrant.

I am not clear when Kuwait plans to set up an independent regulator. Global Mobile Daily suggested as long ago as August 2007 that this was a work in progress and set to be discussed "during the next National Assembly session." I haven't seen news of any developments since then and when a colleague of mine went on a fact-finding tour of the Middle East earlier this year, I do remember a number of his research respondents expressing frustration about the pace of helpful change in the country.

I can't pretend to know enough (yet!) about the MENA region to understand why the speed of evolution towards more progressive regulatory regimes is so uneven across the various markets. In Dubai this month, I certainly got the sense that things are moving faster in some states. One example would seem to be Bahrain, whose regulatory agency sent Deputy Director Tomas Lamanauskas to speak at our conference. I asked Tomas how a Lithuanian had ended up at the Bahraini regulator and learned that he had made the move from the equivalent body in his home country. Tomas told me that to some extent, his new employer is seeking to create a regulatory regime which resembles the EU framework. Tomas replied affirmatively when I asked if, in a sense, his latest role had something in common with the job of harmonising Lithuania's regime to the European framework, something which I remember being a big topic of conversation a CEE region conferences some years ago, not least among delegates from then soon-to-be EU accession states.