Demand and Cooperation in Telecommunication

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Demand and Cooperation in Telecommunication
Demand and Cooperation in
Telecommunication
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Evolution of Mobile Market
Interface
Mobile 1.0
Operator
Portals
Voice ,WAP,
SMS
Mobile
Internet
Mobile 2.0
Interactions
and
Downloads
Mobile
Social Media Connectivity
Internet of
Things
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Key Value
Proposition
Business
Model
Subscription
Driven
Subscription +
Service + Ad
founded +
Premium driven
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Key Trends
Mature Market, Stable
seeing decline in its
“aged” products (e.g.
ringtones)
Emerging Market, large
untapped potential but
with unclear
monetization models
OTT players
Data Usage is Rising
ARPU is dropping globally
Global IP Traffic
Non-voice data is on the
rise
Global Data and Voice Revenues (US$)
800
700
713
720
718
710
698
684
600
500
400
300
253
294
336
377
416
453
Voice
Revenues
Data
Revenues
200
100
0
2010
2011
2012
2013
2014
2015
Source: Ericsson
Source: Cisco
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Growth of Value Added Services
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Time Spent online is Changing
UK Smartphone User's Minutes per
Day - Activity Spend
30
Smartphone User's Total Minutes per Day
Spent
27
Minutes per Day (m)
25
20
15
17
16
14
12
11
10
10
9
9
3
5
0
Source: AT Kearney
•Data is becoming the main growth driver in telecoms
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Youth is becoming an important factor
$$$
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What make Iran an attractive market now ?
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Iran Demographics
Second Largest country in
Middle East, having a
population of 77 million
and the 4th largest market
in Africa and the Middle
East.
Most Attractive
demographic in the region
with >50% of the
population under the age
of 30.
Internet penetration is
lower than other countries
in the region but is
growing in Urban areas (
61% of people to Tehran
with average utilization of
around 1.2GB monthly)
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Population Demographics 1990-2020
Total Population
Dependent Ratio
Active Population %
Youth Population %
100
90000
90
80000
80
70000
70
60000
60
50000
50
40000
40
30000
30
20
20000
10
10000
0
0
1990
Key Indicators
Populations [000]
Households [000]
1995
2000
2009
74,200
14,990
2005
2010
75,090
15,170
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2010
2011
75,920
15,337
2012
2012
76,750
15,505
2013
77,600
15,677
2015
2014
78,450
15,849
2020
2015
79,310
16,022
2016
80,180
16,198
Regulatory Environment
Iran’s latest 5-year plan puts emphasis on developing the telecommunications infrastructure and
ICT services in the country.
Creation of National Intranet , Phase 1 of the Europe-Persian Express Gateway Project, will lead to
more content being available and therefore increased usage.
3G/4G cellular Network providers deployed 3G and % 4G Network nationwide in Iran and Iran is
looking to be involve with 5G standard in coming years
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Economic Environment
 80% of Iran’s income is generated by Oil revenues.
 Iran’s low national debt as compared to its GDP forms a strong foundation for solid growth in the upcoming years
 Until recently (, Iran’s government used a price-fixing policy to regulate inflation, has decided to eliminate subsidies
which has lead to high inflation and lower disposable income per person.
 Fluctuating exchange rates
 Sanctions as well as foreign governments discouraging trade with Iran have made it hard to source technology
infrastructure and for foreign companies to do business with Iran
 But on the other side, this has lead to enthusiastic demand to be independent, leading to remarkable advances in
many technological fields (aerospace, biotech, power plant, oil etc) (strong capabilities and skilled workforce).
 sanction will be removed and combination of Iranian high skill workforce and IT opportunities make Iran attractive
country for foreign investor and advanced technologies
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Social
Demand for internet subscriptions is strong.
Broadband penetration is low
Business demand for services especially mobile
data is growing
Willingness to pay for more lucrative data services
leading to increased levels of data usage.
Willingness to pay for latest devices
Most customers have multiple phones - Sim
penetration very high.
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Some Technological facts
 Iran’s fixed line penetration is one of the highest in the Middle East.
 Competition exists in the ISP market with more than 1200 Internet Access Providers. Recently regulatory
changed this a few internet providers to monitor their performance and qualities
 Recently improvement in telecom infrastructure project such as TCI’s national backbone will help improve
data and voice service quality.
 Operator s in Iran has experienced high demand for its 3G/4G and WIFI products so far but has run into
some difficulties in maintaining its quality of service, mainly due to Backhaul limitation.
 EU, US and UN sanction currently hinder Operators from accessing lower priced equipment to roll out
services in a more cost-effective way. But this will change after sanction removed and attract more
Vendors and cost effective solutions for Iranian market.
 Removing Government restrictions on content will increase ARPU and more potential for investment
specially in Broadband and Fibre.
 As spending power increase ARPU will continue to be increase and more investment in telecommunication
sectors in the short- to medium terms.
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Macroeconomic Environment
Regulatory
• Iran’s latest 5-year plan puts emphasis on
telecommunications infrastructure and ICT
services.
• 3G Tamin Telecom restriction removed and
translate to increase of 3G coverage and 4G
coverage nationwide in Iran by exiting
operators and also room for new operator to
enter to Iranian market
Social
•Demand for internet subscriptions is strong.
•Broadband penetration is low
•Willingness to pay for more lucrative data
services (increasing levels of data usage)
•Willingness to pay for latest devices
•Most customers have multiple phones - SIM
penetration very high.
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Economic
•Iran’s foundation for solid growth in future years
Technologic
•Iran’s fixed line penetration one of the highest in the Middle
East
•Recently developed TCI’s national backbone
•Lack of developed 4G and small Cell networks
•ARPU declines, only traditional voice and SMS services
•Content restrictions slowly fad away
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ICT Network Readiness Comparison
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Iran Telecom Market, space for more infrastructure and technology?
Company Name
Ownership
Market
Telecommunications
Company of Iran (TCI)
Etemad Mobin (50% plus one share),
Government (50%)
Fixed-line (local, domestic long distance,
international), mobile, data operations
Taliya
Rafsanjani Industrial Complex (RIC)
Mobile (GSM900)
MTN Irancell
MTN (49%), Iran Electronic
Development Company (51%)
Mobile (GSM900/1800)
Mobile Telecommunications
Company of Esfahan
(MTCE)
Telecommunication Company of
Esfahan Province (51%), Axiata
(49%)
Mobile (GSM900)
Telecommunication Kish
Co. (TKC)
LibanCell (100%)
Mobile (GSM900), Internet (dial-up, WLAN)
Pars Online
Private (100%)
Internet (dial-up, ADSL, WiMAX)
Datak Telecom
Private (100%)
Internet (dial-up, ADSL, Wi-Fi, direct fibre),
Residential VoIP
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Monthly ARPU by Operator
Monthly ARPU by Operator
MTCE (Mobile Telecommunications
Company of Esfahan)
9.00
8.00
7.00
MTN Irancell (MTN Group)
6.00
5.00
4.00
Taliya (Rafsanjan Industrial Complex
Islamic Cooperative Company)
3.00
2.00
TCI (Telecommunication Company of
Iran)
1.00
Sep 12 Dec 12 Mar 13 Jun 13
Sep
13F
Dec
13F
Mar Jun 14F Sep
14F
14F
Dec
14F
Mar Jun 15F
15F
Tamin Telecom
Source: Markets and Research – Iran Telecom Market 2013
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Our microenvironment analysis also underpins Iran as a
ready market for other services
Research data leads to Iran market as a...
•Low competitive environment , offering a window of opportunity in the
market.
•Demand for high speed data already present, with a large percentage
of Smartphone's despite no services for them.
Regulatory
Demographics
Economic Growth
Market Demand
• favourable demographic as economic factors would contribute to the
success of broadband service in Iran prime locations or hotspots
Disposable income
•But there are uncertainties in the regulatory matters that needs to be
considered.
Equipment supply
•Demographic (high % of young population) and economic growth will
drive high demand for broadband connectivity and penetration of data
service.
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Positive Drive factors for
Broadband uptake
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Telco Regulation
Customer Behaviour
Broadband Technology
Opportunities and Constraints
 Government Controls and regulation over mobile
 Highly favourable demographics
Wi-Fi spectrum, licenses and internet services are
 High Proliferation of Wi-Fi enabled devices
uncertain and could limit growth of a lucrative
 Small number of competitive service offerings
sector.
 Demand for services and connectivity
 Economic factors was hinder investment but now
door open for investment
 High subscriber growth
 ARPU generated by mobile is lower than regional
market ARPU.
 Availability of online content is low as compared
to other countries in the region but changes on
the way
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 Market for mobile data and services is growing
rapidly. Provide a great platform for future mobile
value added services.
 Increase in mobile e-commerce sites and
applications like video-sharing etc.
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