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December 20, 2011

Saudi Arabia's Mobile Market Likely to See Significant Growth: Study
By Ed Silverstein
TMCnet Contributor

Saudi Arabia not only has a large mobile market it is projected to continue to grow.

According to a new Pyramid Research study, the Saudi mobile market is one of the biggest in either the Middle East or Africa – and is one of 17 globally which has over 150 percent mobile penetration. In fact, Pyramid said that the Saudi Arabian telecom market reached $13 billion in revenue last year.

Saudi Arabia’s mobile market has been “strengthened” by a few trends, such as “liberalization policies” and the introduction of new technology, according a press statement from Pyramid Research. LTE (News - Alert) was introduced in Saudi Arabia during September 2011.

In addition, Pyramid Research predicts operators will “aggressively … expand these networks.”

“We expect growth to continue over the next few years, at a CAGR [compound annual growth rate] of 4.2 percent from 2011 to 2016 to reach $17.2bn in 2016,” projects Pyramid Research in company statements. “The market will continue to lean heavily toward mobile data consumption. The commercial launch of LTE service, predicted to be a significant driver of mobile data consumption, will be part of the reason for the positive growth trend.”

Mobile data revenue will more than double to $4.2 billion between 2011 and 2016, Pyramid adds. Projected mobile voice service revenue for 2016 will be $8 billion, Pyramid said.

In addition, Pyramid predicts that mobile voice services will see “negligible” decline – from about $8.2 billion in 2011 with a CAGR of -0.7 percent through 2016.

Pyramid further projects segments with the quickest growth will be fixed VoIP (which will have a 37.3 percent CAGR between 2011 and 2016) and pay-TV (which will have a 21.8 percent CAGR between 2011 and 2016). “Revenue in these areas is only expected to be $198m and $166m, respectively, by 2016,” Pyramid adds. “As dial-up service continues to decline, we project broadband Internet to grow by 10.2 percent from 2011-2016, leading to strong revenues of about $2.4bn in 2016. Fixed circuit-switched voice will also experience modest growth to reach $2.2bn in revenue in 2016.”

More information is contained in Pyramid’s study called “Saudi Arabia: Management & Improvement of LTE Rollouts Boosts Operators and Vendors.”

In other recent technology news about Saudi Arabia, a Saudi prince – who is worth billions of dollars – and his holding company have decided to take some of that money to invest $300 million in Twitter (News - Alert), the popular microblogging site, according to TMCnet. Prince Alwaleed Bin Talal, who is chairman of the Kingdom Holding Company (KHC), made the investment in collaboration with the holding company.

Ed Silverstein is a TMCnet contributor. To read more of his articles, please visit his columnist page.

Edited by Rich Steeves


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