Arab Advisors Group
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International Internet bandwidth in the Arab World: Bandwidth starved until 2005!
Monday, September 3, 2001

When will the Internet bandwidth bottleneck loosen? A new research by the Arab Advisors Group answers the question.

September 03, 2001 -
The Arab World is bandwidth starved. Up-to-date primary research conducted by the Arab Advisors Group shows that more than 740,000 Internet subscribers in eight Arab countries share a grand total of Internet bandwidth of no more than 777 mbps. The combined Internet bandwidth of the eight Arab countries of Egypt, Saudi Arabia, Lebanon, Jordan, Morocco, Oman, Syria and the UAE pales in comparison to what Internet users have available to them in Europe and America: The combined bandwidth of these eight Arab markets is equal to what 518 cable modem subscribers in the US have!

The research released by Arab Advisors Group ( a specialized strategic research company focusing on telecommunication, Internet, and technology in the Arab world, explains why the total Internet bandwidth in the Arab world is very low compared to other countries. The research note also compares / contrasts the Internet bandwidth amongst the Arab countries by using the Arab Advisors Group's "Regional bandwidth index".
"In looking at what the Arab Advisors Group refers to as the "Regional Bandwidth Index" we note that Internet users in Morocco, Egypt, Oman and Jordan have better bandwidth availability than those in UAE, Saudi Arabia, Lebanon and Syria. Syria is the most bandwidth deprived of the countries with a regional bandwidth index score of 0.19. Egypt topped the rankings with a regional bandwidth index of 2.11" Jawad Abbassi, Arab Advisors Group's President, wrote.
The Arab Advisors Group calculated the Regional Bandwidth Index by dividing each country's share of the total Internet bandwidth available by its share of the total subscribers base. Results of more than 1 indicate a better than regional average bandwidth per subscriber. The higher the index the better the bandwidth situation in the country compared to the region. The index results are tied to the actual countries surveyed and analyzed.

The Arab Advisors Group research tied the intra-regional variance to the different dynamics of competition and liberalization in the Arab countries. However, the overall low Internet bandwidth in all of the countries is a direct result of high costs:
"Overall, Internet bandwidth costs in the region remain at much higher rates than those in the US or even Europe. Being small operators on the global scene, the ISPs/operators still lack any "peering" arrangements with international backbone operators. As such they continue to pay the complete cost of full-circuit connections to the International Internet backbone operators. Add to this, the existence of cross subsidization (local rates by international rates) by monopoly operators and the cost becomes even higher." Mr. Abbassi explained in the research note.
"The statistics in this research note are based on extensive and painstaking primary research in all of the markets analyzed", Mr. Abbassi noted. "Arab Advisors Group's team of analysts are based in the region and periodically travel to the countries they cover to meet with operators, regulators and vendors as well as to cement their relationship with Arab Advisors Group's in-country researchers. The strong emphasis on primary research stems from Arab Advisors Group's commitment to providing the most reliable research, analysis and forecasts of Arab communications and Internet markets". Mr. Abbassi added.

With liberalization and privatization steps gathering momentum across the region (five of the markets already have plans to introduce competition in international service by 2005), the Arab Advisors Group predicts an easing of the situation as international bandwidth rates in these markets come down and ISPs expand their international bandwidth without extra costs.

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