Arab World Suffering from Bandwidth Drought

The combined bandwidth of eight Arab nations — Egypt, Saudi Arabia, Lebanon, Jordan, Morocco, Oman, Syria and the United Arab Emirates — share 777 MBPS of Internet bandwidth, according to a report from the Arab Advisors Group.

To put the lack on bandwidth in comparison, the combined bandwdith of these eight nations is equal to what 518 cable modem subscriber have available to them in the United States. To compare the Internet bandwidth among the Arab nations, the Arab Advisors Group developed a Regional Bandwidth Index, which divides each country’s share of the total Internet bandwidth available by its share of the total subscriber base. Results of more than 1.0 indicate a better-than-regional average bandwidth per subscriber. According to the Index, Morocco, Egypt, Oman and Jordan have better bandwidth availability than those in the UAE, Saudi Arabia, Lebanon and Syria. Syria’s Bandwidth Index score of 0.19 make it the most bandwidth-deprived of the countries. Egypt has the best score at 2.11.

“Overall, Internet bandwidth costs in the region remain at much higher rates than those in the United States or even Europe,” said Jawad Abbassi, president of Arab Advisors Group. “Being small operators on the global scene, the ISPs/operators still lack any peering arrangements with international backbone providers. As such they continue to pay the complete cost of full-circuit connections to the international Internet backbone operators. Add to this the existence of cross-subsidization (local rates by international rates) by monopoly operators and the cost becomes even higher.”

Liberalization and privatization steps are gather momentum across the region. Five of the markets already have plans to introduce competition in international servoce by 2005, and Arab Advisors predicts the bandwidth situation will improve as international bandwidth rates come down and ISPs expand their bandwith without extra costs.

ISPs in the ARab region have been content to offer simple dial-up service and leased-line connections to the corporate sector with few attempts to introduce value-added or broadband services to their customer base. The lag behind introducing more digital services such as ISDN and DSL comes due to delays from monopoly fixed services providers.

Extremely low Internet penetration in the majority of the markets, along with regulatory developments, have encouraged operators to explore the prospect of introducing models that accelerate economies of scale. Arab Advisors Group predicts that regional ISPs will color the landscape of the region in the coming years.

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