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Wireless broadband shows strong growth in Saudi Arabia
Published in The Saudi Gazette on 01 - 12 - 2010

JEDDAH: The number of broadband subscribers has grown 43-fold from 64,000 in 2005 to over 2.75 million at the end of 2009, according to data released by the Communications and Information Technology Commission (CITC), representing a CAGR of around 156 percent annually over the period 2005-2009.
According to a study by Basharat Ashai, market analyst, APAC & MEA of Maravedis, a leading analyst firm focusing on 4G and broadband wireless technologies and markets, the broadband penetration rate stood at around approximately 11 percent of the Saudi Arabian population at the end of 2009. Most broadband growth in 2009 was due to the increase in wireless broadband connections, which grew by around 488 percent during the year to reach over 1.41 million. This translates to over 51 percent of all broadband connections. In contrast, while DSL grew by over 30 percent in 2009, its share of broadband subscriptions was reduced from 74 percent the previous year to around 47 percent at the end of 2009. Other wireline broadband connections (cable and fiber) are marginal, constituting less than 2 percent of broadband subscriptions.
Maravedis report further said there is still a high potential for more growth in Saudi Arabia in broadband services, despite the already high growth rates over the last few years. The broadband market is significantly underserved in many suburban and rural areas of the country, but the demographics offer good prospects for growth. The population is young - more than half are less than 25 years old, and about one third are less than 15, while there are more than five million students.
Although Saudi Arabia needs a mix of different technologies to deliver broadband economically, wireless broadband technologies like WiMAX, HSPA and LTE are expected to be major contributors to broadband growth, it noted.
WiMAX operators like Etihaad Atheeb “GO,” ITC and Mobily continue to expand their networks. At the end of Q2 2010 Mobily had deployed 1,649 WiMAX base stations from Samsung across Saudi Arabian 23 cities.
The HSPA+ networks that are already operational in Saudi Arabia, and the ongoing LTE activity, will further help in the broadband uptake. STC is deploying LTE and ZAIN has also commenced deployment in the 2.6 GHz in Riyadh. Mobily has completed testing LTE with Huawei, including lab and field tests that aimed to set up installment and operation plans for evolved packet cores and routing network elements, as well as operation and maintenance systems. Mobily is conducting similar testing with Ericsson and Nokia Siemens Networks, Maravedis said.
Saudi Arabia, along with Bahrain and UAE, is expected to be an early LTE adopter in the Middle East. Mobile operators in these three countries are very active with regard to LTE. UAE-based Etisalat launched 42 Mbps service on its HSPA+ network in Q4 2010, and it plans to launch LTE by the end of the year.
For Etisalat, the main reason to deploy LTE is to address the traffic demand. Etisalat saw a 200 percent growth in traffic in 2009. It expects traffic to double over the next two years. 20 percent of its customers are consuming 80 percent of the traffic, mainly using USB dongles.


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