BMI View: We have made some forecast revisions to our Q416 outlook but our core view remains unchanged. The mobile market witnessed contraction in 2015 as operators shed inactive SIMs. Data from H1 16 suggest that the mobile market returned towards growth in the first six months of the year. We expected modest growth prospects in terms of organic subscriber gains over the course of our forecast period out to 2020. 3G/4G uptake will be higher as new technological prospects are boosted by investments and operators look to deepen client relationships by offering value-added services. In September 2016, the first 4G LTE license was issued to Telecom Egypt ( T E ) for a price of approximately USD800mn. The regulator expects to sell another three 4G licenses in Q416. We expect mobile competition, especially in the data segment , to strengthen over the medium term.
Egypt's authorities and the country's telecoms operators are pushing to increase the uptake and quality of broadband services in the country. In November the Ministry of Communications & Information Technology (MCIT) announced plans to increase the country's internet penetration rate to 50% by the end of 2016, from 34% at present. The ministry also intended to add around 500,000 new internet users in the country by the end of 2015.
MCIT expects to add 1.5mn broadband subscribers by the end of 2016 and increase entry-level access speeds from 1Mbps to 2Mbps. Separately, government-backed Telecom Egypt reportedly aimed to replace copper cables with fibre optic cables for approximately 4mn households by the end of 2015. The move would allow TE to provide its subscribers with the latest communication services and techniques via boosting the role of fibre optic cables instead of the copper ones, along with installing multi-service access nodes. We are predicting strong and steady growth in the uptake of broadband services, including wireline and mobile broadband offering, through to 2020. Improvements to infrastructure will contribute to the strong growth.
Latest Updates & Industry Developments
In Q216 Egypt's mobile market grew by 0.7% y-o-y, with 95.48mn subscriptions at the end of June 2016. Significant discounting of inactive SIMs contributed to losses in 2015. Our outlook for the country's mobile market remains subdued. We predict growth of just 2.4% in the 12 months to December 2016 and, by 2020, we forecast the market to be serving 99.49mn subscriptions, yielding a penetration rate of 99%.
In the five years to 2020, we believe average annual growth for Egypt's 3G subscriber market will be around 15%. By the end of 2020, we expect more than 45.6mn 3G subscriptions, accounting for 46% of the total mobile market.
TE is the leading provider of broadband services, with the operator reporting an impressive 42.1% y-o-y increase in ADSL subscriptions in 2015. We predict that total broadband connections, including mobile broadband connections, will reach 9.46mn by 2020, equivalent to a penetration rate of 9.4%.
|3G/4G Subscriptions To Rise Steadily|
|3G/4G Subscriptions & Total Mobile Subscriptions, 2014-2020|
|e/f = BMI estimate/forecast. Source: MCIT, NTRA, operators, BMI|
The Egypt Telecommunications Report features BMI Research's independent industry forecasts on the future strength of Egypt's ICT market, covering the fixed-line, mobile and internet segments and analyses latest regulatory developments and corporate news, including investment activity, mergers and acquisitions, joint ventures and partnerships. Leading operators and manufacturers are fully profiled, highlighting their quarterly financial performance, capital expenditure plans and latest contracts.
BMI's Egypt Telecommunications Report provides industry professionals and researchers, operators, equipment suppliers and vendors, corporate and financial services analysts and regulatory bodies with independent forecasts and competitive intelligence on the telecoms industry in Egypt.
- Benchmark BMI's independent telecoms industry forecasts for Egypt to test other views - a key input for successful budgeting and strategic business planning in the Egyptian telecoms market.
- Target business opportunities and risks in Egypt's telecoms sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Egypt.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity).
BMI Industry View
Summary of BMI’s key industry forecasts and views, covering the ARPU, fixed-line, mobile (including 3G & 4G), internet and broadband markets.
Industry SWOT Analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the wireline and wireless sectors and within the broader political, economic and business environment.
BMI Industry Forecast Scenario
Historic data series (2010-2013) and forecasts to end-2019 for all key industry indicators, supported by explicit assumptions, plus analysis of key downside risks to the main forecast.
- Fixed-line Telephony – Telephone lines (‘000); telephone lines/100 inhabitants.
- Cellular Telephony – Mobile phone subscribers (‘000); mobile phone subscribers/100 inhabitants; and where available, 3G & 4G subscribers (‘000); 3G & 4G subscribers/100 inhabitants; 3G & 4G subscribers as a percentage of overall mobile market.
- Internet Markets – Internet users (‘000); internet users/100 inhabitants; broadband internet subscribers (‘000); broadband internet subscribers/100 inhabitants.
BMI’s Telecommunications Risk Reward Index
BMI’s Risk Reward Indices provide investors (vendors, operators and suppliers) looking for opportunities in the region with a clear country comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide an Indices of highest to lowest appeal to investors, with each position explained.
Market Data Analysis
Detailed market analysis of the mobile, mobile content, fixed-line and internet segments, broken down into:
- Market Data – Analysis of market size, operator shares, dominant trends, competitive landscape and key quarterly data.
- Technology/Service Rollout – Analysis of rollout/adoption of new technology, such as 3G & 4G, WiMAX, IPTV, pay-TV, LTE and valueadded handset services (gaming, music, video, apps etc.).
- Mobile Content – The latest trends in content and services available and being introduced by mobile operators, including a timeline of all the latest major mobile content developments.
Company Database – A comprehensive breakdown of KPIs of the leading mobile operators, including subscriber figures by type (pre-paid and post-paid); 3G & 4G subscriber figures; net additions; market share; ARPU; churn rates; minutes of use; voice and non-voice revenue; financial figures (including operating revenues, net profits and EBITDA).
Details of the regulatory bodies and their responsibilities, as well as a special focus on the rules surrounding competition and interconnection. Also covers the latest updates in the market’s development and regulatory rulings.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate Company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
The Telecommunications Reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.