Forget Europe, broadband in Middle East must carve out its own future

Posted by Mohammed Hamza Tuesday, March 10th, 2009

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I am attending the Broadband Global Summit here in Dubai and the broadband vibrations are emanating not from the floor but through the air with mobile broadband emerging as a hot topic. This was no surprise to me, nor will it be to anyone who knows the dynamics of the Middle East and North Arica.

Motorola pointed out that Etisalat’s Saudi Arabian operation Mobily is experiencing mobile data usage of 18 terabytes per day on its network, the highest in the world, while the much smaller Sultanate of Oman is seeing mobile data usage of 3 terabytes per day, which is still a significant amount.

Mobile broadband is certainly filling the gap left by the paucity of fixed broadband connections, both in metropolitan and rural areas. Both technologies fixed WiMAX and HSxPA are playing a major role in this usage.

So what of traditional fixed broadband over xDSL? It’s certainly on the agenda. Talk of the types of services that will be delivered over next generation networks were discussed and audience responses on the operator side noted education, healthcare, social networks and home networks as being the prime candidates to justify NGN build out.

While some effort is being made to build out fiber in the Middle East, the Gulf region is leading the way.

First and foremost is Abu Dhabi, the UAE’s capital city, which is set to become the first fully connected fiber city in the world, according to Nasser Ahmed Bin Obood, chief corporate affairs officer for Etisalat.

Not something you would try in Europe. The Gulf region has the opportunity to innovate in unique ways. For example, consider the King Abdullah Economic City, a Greenfield city on the shores of the Red sea, one of the largest private projects being built in Saudi Arabia, where Ericsson has entered in to a partnership with EMAAR to build, operate and manage a complete communication and media distribution infrastructure for this smart city.

A consortium headed by global real estate giant EMAAR and several Saudi high profile investors are embedding Ericsson’s technology in the heart of the communication infrastructure’s construction. It’s the future coming to life on the borders of Europe.

In Europe such engineering ambitions are not viable from a cost perspective, nor is there the availability of large swathes of untouched land, or even the political ambition to push such projects through. These countries have the vision, ambition and the money to attempt crazy futuristic projects not attempted before on a massive scale.

As Raghu Venkataraman Du’s EVP of corporate strategy and strategic marketing said: In Europe you feel sorry for them, you learn from them, but you don’t follow them.

Look at it this way: the low broadband penetration, the high prices, the low DSL speeds of 2-4 meg compared to Europe’s 20 meg, the high copper distances from the exchanges to homes, the low quality of copper, the existence of little if any competition between fiber and cable and the low customer expectation of broadband connections may sound the death knell for copper in the Middle East but it certainly provides for a major incentive to build out fiber.