AN­A­LYST IN­SIGHT

Comms MEA - - Oman Country Profile -

Graeme Lowther is a man­ag­ing part­ner with Salience Con­sult­ing, with ex­per­tise on telecom­mu­ni­ca­tions com­mer­cial ne­go­ti­a­tions, lead­ing com­plex projects and strate­gic plan­ning. Here, he dis­cusses trends cur­rently tak­ing place in the Omani mar­ket – and what they might mean for the fu­ture.

Ur­ban fi­bre trans­for­ma­tion

Oman Broad­band con­tin­ues to roll out FTTH con­nec­tions in Mus­cat, and is about to re­lease a metro net­work in Salalah, It will re­lease this in Oc­to­ber, pro­vid­ing all three fixed op­er­a­tors with ac­cess to Oman Broad­band’s pas­sive FTTH fi­bre net­work.

In Mus­cat, Oman Broad­band now pro­vides ac­cess to nearly 250,000 house­holds and this net­work is ex­pected to dou­ble be­fore the end of 2019.

Three li­censed op­er­a­tors are de­liv­er­ing ser­vices over Oman Broad­band: Awasr, Oman­tel and Oore­doo Oman. Awasr of­fers home con­nec­tions up to 1GB speed. In Mus­cat, the con­sumer re­sponse to the take-up of fi­bre broad­band is good, with nearly 70,000 homes con­nected to Oman Broad­band’s net­work, com­pared to less than a 1,000 be­fore the launch of Oman Broad­band in 2014.

Oman Broad­band has also be­come the clear­ing­house for gov­ern­ment fi­bre in Oman that is presently un-utilised. Fi­bre in­stalled for SCADA or teleme­try ap­pli­ca­tions is now be­ing re­leased to Oman Broad­band to be sold as a whole­sale prod­uct to li­censed op­er­a­tors. This will al­low Oman, on a na­tional level, to un­lock the value of a sig­nif­i­cant num­ber of long-haul fi­bres.

Growth of Awasr, the new fixed op­er­a­tor

Since start­ing oper­a­tions two years ago, Awasr has con­tin­ued strong growth in the fi­bre broad­band space. Af­ter win­ning the fastest net­work in Oman award from In­ter­net speed test­ing com­pany Ookla ear­lier this year, Awasr con­tin­ues to in­vest heav­ily in pro­vid­ing cus­tomer ser­vice.

Oman­tel is ru­mored to be un­der­go­ing mass-mi­gra­tions of some ar­eas presently served by old DSL tech­nol­ogy, and this would makes sense as the cost of op­er­at­ing and main­tain­ing a DSL cop­per net­work is greater than the Opex over­head of util­is­ing the ex­ist­ing fi­bre net­work from Oman Broad­band.

Oore­doo Oman con­tin­ues to utilise LTE as their pri­mary means of de­liv­er­ing broad­band ser­vices, but this is be­com­ing less ap­peal­ing to con­sumers in Mus­cat as fi­bre be­comes avail­able.

Con­sumer price re­duc­tions

The in­tro­duc­tion of Awasr has seen the con­sumer price for broad­band con­nec­tions drop sig­nif­i­cantly over the past two years, with very ag­gres­sive pric­ing from some op­er­a­tors and of­fers that ef­fec­tively re­duce the cost to the con­sumer (free months, or ex­tra ca­pac­ity of­fers, for ex­am­ple).

Av­er­age rev­enue per user (ARPU) in Oman re­mains high, but com­pe­ti­tion is cre­at­ing value for the con­sumer, as well as driv­ing in­no­va­tion in ser­viced pack­ag­ing and de­liv­ery. From an av­er­age cost of 30 Omani ri­als for a DSL con­nec­tion in 2015 to a cost of 25 Omani ri­als for a 20MB con­nec­tion, this year shows that prices have dropped and ser­vices have im­proved.

Ru­ral ini­tia­tives

Oman Broad­band is presently ex­plor­ing means to de­liver high speed broad­band ser­vices to ru­ral ar­eas us­ing the OPGW fi­bre of the elec­tric­ity grid. By cre­at­ing a na­tional dense wave­length di­vi­sion mul­ti­plex­ing (DWDM) ring, Oman Broad­band will be able to de­liver data ser­vices through elec­tri­cal sub­sta­tions, ex­tend­ing the net­work over areal fi­bres to reach ru­ral com­mu­ni­ties. This project is still in the early stages, but the in­dus­try ex­pects that this will not be a suc­cess with­out some kind of sub­sidy from cen­tral gov­ern­ment. Ru­ral fi­bre re­main gen­er­ally un­vi­able from a cost/profit per­spec­tive.

How­ever, com­bin­ing the ben­e­fits of com­mer­cial­is­ing the OPGW fi­bres, es­tab­lish­ing a tow­ers com­pany, and pro­vid­ing ac­tive ca­pac­ity to ru­ral ar­eas, this could help Oman over­come the dig­i­tal di­vide.

Third mo­bile li­cence back on the ta­ble

The third mo­bile li­cense in Oman is again be­ing brought back to life, with Oliver Wy­man con­tracted to re­view the of­fer­ing and to rec­om­mend a new struc­ture. The new struc­ture is likely to re­duce the roll­out re­quire­ments of the phys­i­cal net­work, while re­lax­ing some of the other con­di­tions, such as ac­cess to na­tional roam­ing. It re­mains to be seen, how­ever, if this will be enough to at­tract a se­ri­ous third op­er­a­tor to a mar­ket which is al­ready sat­u­rated with more than 152% pen­e­tra­tion, and with a ter­rain that makes the in­stal­la­tion of tow­ers and back­haul very ex­pen­sive.

The Min­istry of Trans­port and Com­mu­ni­ca­tions is in the process of cre­at­ing a tower share com­pany that will be re­spon­si­ble for fa­cil­i­tat­ing the shar­ing of ra­dio masts as well as con­struct­ing new tow­ers that would be re­quired. This is seen as a sig­nif­i­cant en­abler for the fu­ture tran­si­tion to 5G, and per­haps will help en­able the launch of a third op­er­a­tor.

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