Saudi Arabia continues to boast the largest telecoms and enterprise IT market in the Middle East and Africa region (MEA), although total mobile and fixed services revenues declined in 2014 for the first time in a decade.
According to a new report by Pyramid Research, total mobile and fixed services revenues in the consumer and enterprise segment in Saudi Arabia fell by 1 per cent to $16.2 billion (€15 billion) in 2014. The drop was attributed to aggressive promotional activity and Mobily's restatement of financial results: the country's second-largest operator saw revenue decline by 20 per cent in 2014.
Nonetheless, Pyramid Research said the Saudi Arabian telecoms market remained the largest in terms of total service revenue in the MEA region in 2014, followed by South Africa ($13.4 billion) and Turkey ($13 billion).
The research company also expects to see further growth ahead: it forecasts that over the next five years, annual growth of the Saudi telecoms market will average 3 per cent per year, reaching $18.7 billion by 2019.
"Operators have invested in upgrading network infrastructure and systems to handle growing data traffic volumes. The need in the short-term is for swift deployment of fibre connectivity in high demand areas such as Riyadh, Jeddah, Mecca, Medina and Al-Ahsa. This will improve the competitive landscape in the fixed broadband services segment, where historically the incumbent operator, STC, has led," said Hussein Ahmed, analyst at Pyramid Research.
In the mobile market, the arrival of mobile virtual network operators (MVNOs) such as Virgin Mobile and Lebara is also expected to add fresh impetus with new promotions for data and voice services.
"Towards 2019 we will see the potential for improvements in the competitive landscape, while operators remain persistent in identifying new revenue streams," Ahmed added.
- see this Pyramid Research release
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