Jordan - 3G to Stabilise ARPU in Jordan

01 Sep 2011 • by Natalie Aster

BMI’s five-year ARPU forecast for the Jordanian mobile market is based on data released by market leader Zain Jordan and Orange Jordan, the mobile arm of fixed-line incumbent Jordan Telecom, both of which represent about 68.9% of the market by subscribers. Zain's blended ARPU data are published in US$, while France Telecom, which owns a 51% stake in Jordan Telecom, publishes Orange's ARPU in EUR. Third-ranked Umniah does not publish ARPU data on a regular basis.

Industry Forecast - Mobile ARPU

 

2008

2009

2010

2011f

2012f

2013f

2014f

2015f

Monthly Blended ARPU (JOD)

11.2

9.7

9.1

8.7

8.6

8.7

8.8

8.8

Zain ARPU (JOD)

13.5

10.3

11.3

10.6

10.1

9.8

9.7

9.8

Orange (JOD)

8.1

8.9

6.4

6.5

6.8

7.5

7.6

7.7

 

Mobile ARPU rates in Jordan fell below JOD11 (US$15) during 2009 due to increasing competition in the mobile market dominated by basic voice and SMS services. BMI calculates that monthly blended ARPU, which is the weighted average of ARPU rates published the country's mobile operators, stood at JOD9.1 at the end of December 2010. BMI believes increased competition in the basic voice and SMS segment is largely responsible for the decline of ARPU rates in Jordan, a situation that could worsen with the introduction of MVNO services in Jordan. Dubai-based MVNO FRiENDi Mobile launched services in Jordan in June 2010, and we believe other MVNOs aiming to expand in the Middle East and North Africa will be keen to enter the Jordanian market.

Industry Forecast - Mobile ARPU
2008-2015

f = forecast. Source: BMI

 

 

While the introduction of MVNO services is set to increase downward pressure on voice revenues, we believe the rollout of 3G network services and the rapid subscriber take-up create an opportunity for operators to increase non-voice revenues through mobile data and advanced value-added services. In March 2011 Orange said its 3G subscriber base reached 300,000, up 100% from about 150,000 at the end of December 2010. It has set an ambitious target of 900,000 3G subscribers by the end of 2011. Meanwhile, Zain's CEO, Abdul Malek al-Jaber, said the operator registered about 350,000 3G users by May 2011, about three months after it launched services. Of this number, 100,000 users access mobile data through dongles, while the remaining 250,000 subscribers access the network through smartphones.

BMI believes the rapid growth of 3G subscriptions and growing use of smartphones and other mobile devices to access mobile data services will help stabilise blended ARPU rates in the latter part of our forecast period. Orange, which reported strong 3G uptake in Q410 and Q111, saw its blended ARPU increase by 14.9% q-o-q to EUR7.7 at the end of Q111. BMI believes the operator's mobile data service over its 3G network is partly responsible for the uptick in ARPU. Zain launched 3G services in March 2011 and we expect it to register similar improvements to its ARPU in subsequent quarters. Considering the positive impact of mobile data services on operators' ARPU rates, we expect overall mobile market ARPU in Jordan to stabilise at an average of JOD8.7 over the next five years.

Related Reports:

United States Telecommunications Report Q3 2011;

Switzerland Telecommunications Report Q3 2011;

United Kingdom Telecommunications Report Q3 2011;

Sweden Telecommunications Report Q3 2011;

Philippines Telecommunications Report Q4 2011;

North Africa Telecommunications Report Q3 2011;

Qatar Telecommunications Report Q3 2011;

Saudi Arabia Telecommunications Report Q3 2011;

South Korea Telecommunications Report Q3 2011;

Taiwan Telecommunications Report Q3 2011.

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