Arab Advisors Group
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Kuwait’s PSTN and Cellular markets: Approaching steady state!
Tuesday, October 19, 2004

The cellular market in Kuwait took off rapidly after the entry of Wataniya in 1999 as the second mobile operator. The penetration rate in Kuwait has climbed to more than 80% due in large part to the heavy marketing campaigns during 2004. Cellular revenues were more than double the PSTN revenues in 2003. The Arab Advisors Group projects that the current breakdown will not change significantly over the forecast period, as PSTN and cellular revenues will remain fairly consistent as Kuwait’s telecom market nears saturation. Value added services and compelling content will be the keys for driving usage and growth in this very well developed telecommunications market.

The Ministry of Communications (MOC) solely operates Kuwait’s fixed telecommunications network and is also the regulatory entity for telecommunications in the country. Development plans are issued by the MOC, while in some cases approval from the parliament is essential for matters pertaining to operating licenses, liberalization policies and privatization issues. Kuwait joined the WTO in January 1, 1995, but is just now getting around to initiating the full liberalization process in Kuwait. In fact, Kuwait has lagged behind other GCC countries with regards to the privatization process of the fixed telecommunications sector. All of Kuwait’s neighbors have already partially-privatized their incumbent PSTN operators. Nonetheless, Kuwait’s stance is secure as one of the Arab World’s most advanced telecommunications markets.

A new report, “Kuwait Communications Projections Report 2004” was released to the Arab Advisors Group’s Strategic Research Services subscribers on October 14, 2004. This report can be purchased from the Arab Advisors Group for only US$ 850. The 54-pages report, which has 47 detailed exhibits, fully profiles and analyses the Kuwaiti fixed and cellular telecom markets. Detailed analysis of the operators MOC, MTC and Wataniya are included in the report as well as 5-year historical and 5-year projections of over 45 major telecom and demographic indicators. The report’s TOC can be received from the Arab Advisors Group upon request.

Any investment in this report will count towards an annual Strategic Research Service subscription should the service be acquired within three months from purchasing the report.

The investment can also count towards attending Arab Advisors’ second annual Media and Telecoms Convergence Conference on June 11 & 12 2005. More information on the conference can be seen at . Alternatively contact the Arab Advisors Group for full information on the conference, agenda and sponsorship opportunities.

“Cellular services in Kuwait are offered through private independent companies that were granted licenses by the MoC. Kuwait’s mobile market is a duopoly market with two publicly traded companies, namely MTC-Vodafone and Wataniya Telecom. The government has a stake in each of the two companies, whose stocks are publicly traded on the Kuwait Stock Exchange.” Wrote Mr. Yaman Al Jundi, Arab Advisors Research Analyst in the report. “The current operators are certainly aware of the threat of any potential upcoming competition, and the already high penetration rate will no doubt be a barrier to entry for any potential entrants. The Arab Advisors Group projects Kuwait’s cellular subscriber growth to level off in the forecast period, growing at a CAGR of 5% between 2003 and 2008 to reach around 2.17 million subscribers by end of 2008, or a penetration rate of 86%.” Mr. Al Jundi added. Mobile revenues are projected to touch the US$ 1 billion mark in 2008.

The Arab Advisors Group’s team of analysts in the region has already produced close to 280 reports on the Arab World’s communications and media markets. The reports can be purchased individually or received through an annual subscription to Arab Advisors Group’s Strategic Research Services (Media and Telecom). To date, Arab Advisors Group has served more than 205 global and regional companies by providing reliable research analysis and forecasts of Arab communications markets to these clients.

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