Arab Advisors Group
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Year 2001 was one of Jordan's Communications Market's Golden Years. 2002 is set to be another golden one!
Tuesday, August 27, 2002

A newly released country report from the Arab Advisors Group fully analyzes the Jordanian communications market. Owing to competition between the two GSM operators in 2001, GSM penetration rates exceeded 15% in that year when the number of GSM lines exceeded the number of fixed lines for the first time ever.

August 27, 2002 -

In the past few years, Jordan has managed to advance its communications infrastructure and services considerably, owing mainly to the partial privatization of the fixed monopoly operator and the entrance of effective duopoly competition on the GSM front - all in line with Jordan's commitments to the WTO of which it has membership.

A new report "Jordan Communications Projections Report-2002", was released to the Arab Advisors Group's ( Strategic Research Service subscribers on August 26, 2002. The report shows that since its partnership with strategic investor France Telecom, Jordan Telecom has acquired local datacomm operator and ISP Global One and launched subsidiaries MobileCom, e-dimension and Jordan Wide - clear moves to further position itself as an Integrated Communications Services Provider. The operator has worked aggressively to improve its services launching an advanced Customer Care and Billing Service (CCBS) and a number of points of sales to better handle customer needs.

"Fixed subscriber penetration has only grown marginally since the privatization of Jordan Telecom. Yearend 2001 penetration stood at 13%, as opposed to 12% in 2000. This is mainly owing to the fixed to mobile substitution apparent in the market due to the competitive pricing of the GSM operators" Arab Advisors Group's analyst Sarah Alalul , author of the report, said.

"The cellular market saw huge growth upon the entrance of the second GSM operator MobileCom in late 2000. The market grew by 462,000 GSM subscribers in 2001. This was close to double the rise in subscribers in 2000 and resulted in more than doubling the GSM penetration rate from less than 7% in 2000 to 15.7% in 2001. This was the year when GSM lines in Jordan exceeded the number of PSTN lines for the first time." Ms. Aloul added. "The Arab Advisors Group projects PSTN revenues to exceed the US$ 460 million mark by 2006, up from 378.8 million in 2001, while GSM revenues will reach US$ 673 million in 2006 up from US$ 261.8 million in 2001", Ms. Alalul explained.

Competition in the cellular market has been quite aggressive, with Fastlink flooding the market with many postpaid and prepaid packages and undertaking a sophisticated customer care platform as well as fierce marketing and sales campaigns. Its efforts have not gone in vein as Fastlink still commands a majority market share. MobileCom, on the other hand, despite its competitive pricing and distinctively simpler packages (plus the launch of its "Smart" service - a cross between postpaid and prepaid) is still perceived as the poor man's operator. Having said that, the second GSM operator is offering tailored packages to the corporate sector and has made impressive inroads into the corporate market.

The 70-plus pages report, which includes 85 detailed exhibits on the market, shows that the Jordanian market will have yet more competition in the future. The regulator (TRC) has offered to issue a maximum of three digital radio trunking licenses to the two GSM operators and the paging operator provided they launch service before the end of 2004. Also, the government reported in June 2002 that Jordan Telecom will issue an IPO in the local stock market by the end of the year as a means to sell some of the government's stake in the operator. J.P. Morgan Chase & Co. has won the mandate to act as the operator's leading financial advisor and underwriter for the IPO.

The Arab Advisors Group's team of analysts in the region has already produced more than 105 reports on the Arab World's communications markets. Following the report on Jordan, comprehensive reports on Qatar, Bahrain will be out shortly. The reports can be purchased individually or received through an annual subscription to Arab Advisors Group's ( Strategic Research Service. To date, Arab Advisors Group has served more than 60 global and regional companies by providing reliable research analysis and forecasts of Arab communications markets to these clients.

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