Morocco’s fixed line service stagnates
Morocco is the first country in the Arab World to have witnessed a drop in its fixed lines market. Morocco’s Telecommunications market has been on the vanguard of Arab markets considering the presence of competition in most of its sectors: GSM, Internet and VSAT. Nonetheless, the luster of the rapid growth in cellular services that duopoly competition and prepaid induced, is diminished by the very disappointing fixed line segment performance over the past two years.
A newly released report from the Arab Advisors Group shows that Morocco is lagging behind in its fixed services although there is no actual barrier to reach the PSTN usage level of either Jordan or Syria or Egypt, as an example.
“The monopoly conditions, and a focus on the GSM market by the monopoly operator, have resulted in negative growth even at low penetration rates: Between 1997 and 2001 the PSTN subscriber base decreased at a CAGR of – 4 percent even though penetration was only 3.7 percent in 2001.” Arab Advisors Group’s analyst, Hala Baqain wrote in the report.
“The current crisis in the PSTN market in Morocco is due to the attractive offers of the mobile operators. The growth in mainlines in Morocco continued until the entrance of the second GSM operator in 2000. In 1999, the number of mainlines grew at five percent while in 2000 the PSTN market witnessed a drop of five percent which continued in 2001 when it declined by a whopping 21 percent. This huge decline in the mainline subscribers can be explained by a substantial increase in the GSM subscriber base, where it grew at impressive rates of 585 percent in 2000 and 86 percent in 2001.” Baqain added.
The Arab Advisors Group concludes that the Moroccan market can sustain a much higher penetration rate, and competition, but only if proper attention is paid to the cause of the current decline: Relatively high PSTN rates, making GSM more feasible and very low demand from Internet subscribers. — (menareport.com)
© 2002 Mena Report (www.menareport.com)