Arab Advisors Group
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Arab World's International Connectivity markets present ripe growth opportunities for FO submarine cable and satellite operators!
Monday, December 24, 2001

A new report from the Arab Advisors Group (www.arabadvisors.com) shows that Arab countries are expected to use more than 18,500 Mbps in total International connectivity bandwidth by 2005. Saudi Arabia and Egypt alone use more than 60% of the total currently utilized Internet bandwidth in the region, while Saudi Arabia boasts the highest number of international voice circuits, closely followed by the UAE.
December 24, 2001 -
Five global players provide most of the Arab World's International connectivity. These are two major international submarine fiber optic cables and three satellite operators. All International Long Distance (ILD) operators in the Arab World obtain part of their international bandwidth via Arabsat, since all Arab governments are participants in the Arabsat organization. In addition to Arabsat, international bandwidth is also acquired via Intelsat and Inmarsat. On the submarine fiber optic cables front, connectivity is provided by SEA-ME-WE and FLAG cables. The Arab Advisors Group believes that competition amongst the fiber optic and satellite operators for providing international connectivity will increase as soon as newly established ILD and PSTN operators enter the competitive landscape in WTO compatible countries in a few years. Full liberalization of the PSTN and ILD services will also increase the bandwidth capacities provided by the fiber optic and satellite operators and invite new operators to join the fray.

A new report, "International Connectivity in the Arab World", was just released by the Arab Advisors Group to its Strategic Research Service Clients. The 38-page report is the culmination of 3 months of painstaking research covering telecom operators across the Arab World. The report profiles the main companies serving the Arab World's international connectivity markets (voice and data) and details the existing infrastructure situation in each of the 13 covered Arab countries.
Most of the Arab countries examined obtain their international bandwidth via FLAG (which provides connectivity to 82% of the examined countries), SEA-ME-WE (73%), Arabsat (100%), Intelsat (82%), and Inmarsat (27%), amongst other operators. FLAG, SEA-ME-WE, and Arabsat have the lion's share of circuits provided as they provide the region with most of the utilized bandwidth capacities.
The report, written by Arab Advisors Group's analysts Shahin Shahin and Sami Sunna', shows that the total number of international circuits (global and regional) for Egypt, Jordan, Kuwait, Lebanon, Oman, Saudi Arabia, Sudan, Syria, and the UAE exceeds 64,000 circuits, representing 0.40% of total countries' mainlines. Saudi Arabia has the largest percentage share of circuits at 29.6%, while Sudan has the lowest percentage share at 3.2%.
"When it comes to the percentage share of International Long Distance minutes (outgoing and incoming), Saudi Arabia has the highest share at 33.9%, while Syria has the lowest share at 2.7%", noted Shahin Shahin. "By examining the ratio of international voice circuits available in each market to its share of the outgoing and incoming minutes within a regional context, we calculated the Arab Advisors Group's International Voice Circuits Utilization (IVCU) index for all the countries in the report", Mr. Shahin added.
The report shows that Syria has the highest IVCU Index score at 2.68 while Lebanon had the lowest at 0.44. "This means that Syrians making international phone calls are much less likely than the Lebanese to encounter busy signals. A high IVCU Index score could also mean that the circuits available are being under utilized", noted Sami Sunna'. "Clearly, a very high index score maybe just as bad as a very low one", Mr. Sunna' added. Kuwait, Lebanon, Oman, Saudi Arabia and Sudan all have IVCU index scores of less than 1, while Egypt, Jordan, Syria and the UAE have IVCU index scores of more than 1.

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