Bahrain maybe underestimated for its small land area and population however its telecommunications market hosts one of the most profitable and successful operators in the region. The Bahraini communications market and its monopoly operator Batelco are capable of sustaining effective competition in cellular service, asserts a newly released report from the Arab Advisors Group.
Bahrain’s communications market is rewarding, in yearend 2001 its total revenues exceeded $450 million. Voice services, GSM (Global System for Mobiles) and fixed, remain the mainstay services, as they constituted 68 percent of the Batelco’s total revenues in 2001.
The Bahrain Communications Projections 2002 report shows that the signals from Bahrain are all positive for liberalization. The healthy state of the savvy and profitable Batelco means that the government will not fear for the operator from competition. Though, new entrants may have a lot to fear from Batelco should a fair regulatory regime be absent from Bahrain.
Given the higher than regional average rates for Internet, datacomm and GSM services, and the limited options for customers, the Arab Advisors Group believes that these three segments may be the first to be liberalized in Bahrain.
“The demand for the PSTN (Public Switched Telephone Network) services has leveled off. Batelco was able to serve the entire country by providing an integrated network that offers a wide portfolio of services. Bahrain will have marginal additions to the number of PSTN subscribers parallel to the growth of the natural households as well as businesses’ growing needs,” analyst Hala Baqain noted.
The report shows that Bahraini GSM subscriber base is still growing. The number of mobile users who are between the ages of 14 and 21 has risen rapidly in the last two years, mainly due to the successful launch of the prepaid SimSim service in addition to the availability of cheaper handsets in the market.
With this increase in the young generation users, the demand for personalized services such as downloading ringing tones and more sophisticated wireless Internet services will definitely increase. When implemented by Batelco, this will expand the revenue pie for Batelco and should be seriously considered by the future GSM competitor since competition will be based on competitive rates and the VAS offered. The Arab Advisors Group projects Bahrain’s GSM subscriber base to reach 625,000 in 2006, a penetration rate of 77 percent. — (menareport.com)
© 2002 Mena Report (www.menareport.com)
