Lebanon's Internet market poised for bandwidth relief by early 2002!

Lebanon's competitive ISP market will witness a rise in its total Internet International Bandwidth as well as its routing efficiency, according to new research from the Arab Advisors Group (www.arabadvisors.com), which examines OGERO's plans to setup an Internet node in Lebanon.

December 13, 2001 -

Lebanon fares well by regional standards when it comes to Internet penetration. Competition has caused Internet fees to be quite low and subscriber numbers already exceed the 110,000 mark, serving around 420,000 Internet users in the country. This said, the quality and speed of connections leave a lot to be desired in Lebanon: To date there is no ADSL broadband service (although illegal Ethernet cable exists) and total international bandwidth stands at no more than 52 mbps (the bulk of which is downlink-only connections). In fact, the Arab Advisors Group calculated the regional Bandwidth Index for Lebanon in August 2001 to be 0.43 only. The Regional Bandwidth Index is calculated by dividing a country's bandwidth share by its accounts share (the study included seven other markets). An index score of less than 1 indicate a worse than regional average bandwidth per subscriber.

New research by Arab Advisors Group reveals that Lebanon's bandwidth problems will be partially alleviated in 2002. The research, entitled "A local Internet node in Lebanon: A good move." was released to Arab Advisors Group's Strategic Research Service subscribers on Dec 12, 2001.

"All of Lebanon's ISPs currently obtain their International Internet bandwidth via global backbone operators by utilizing OGERO's leased lines half circuits, as well as via satellite operators for additional downlink-only bandwidth after acquiring the permission of the Ministry of Telecommunications." Wrote Mr. Sami Sunna', an Arab Advisors Group analyst, in the research.

"This means that every ISP gets its own international link and the ISPs are not interconnected at the local level", Mr. Sunna noted. "Even traffic from one ISP to another ends up being routed outside Lebanon and consuming a portion of the already scarce Internet bandwidth in the country", he continued.

Arab Advisors Group research reveals that OGERO (Lebanon's monopoly fixed services provider) plans to set-up an Internet node in Lebanon in early 2002. This node is planned to have a total bandwidth capacity of 90 Mbps and will cater for all of the incumbent ISPs in Lebanon and also interconnect them locally. OGERO will charge around US$ 10,000-15,000 per month for providing an ISP with a 2 Mbps (E1) capacity through the node. This is a good 50% reduction on current rates charged by OGERO for half circuits only.

Lebanon's planned Internet node will use global submarine cable operator FLAG's landing point in Aqaba, Jordan (OGERO is discussing the issue with Jordan Telecom) and on Berytar fiber optic cable (Beirut-Tartous) and Aletar fiber optic cable (Alexnadria-Tartous). France Telecom has a connection between Marseille and Alexandria.

"Should this project go ahead as planned, it will underline the big role that the FLAG landing point in Jordan has had in greatly improving the Internet situation in the Levant", noted Jawad Abbassi, Arab Advisors Group's president. "FLAG's landing point in Aqaba availed Jordanian ISPs lower cost bandwidth than what was previously available and enabled the start of the small but growing broadband Internet market in the country. Jordan Telecom's expected upcoming agreement with OGERO will extend the benefits of submarine global FO connectivity to Lebanon as well. Arab Advisors Group's continuous research and analysis of Arab communications and Internet markets allows our analysts to reliably spot trends and predict markets' growth by benchmarking regional and globally". Mr. Abbassi added.