Resilience in Lebanon
Civil war, demographic challenges, slow Internet speeds, and more –Lebanon has had to overcome a lot to grow its telecommunications infrastructure and industry. And that resilience – and spirit of innovation – means Lebanon today is a land rife with opp
Lebanon has had to overcome a lot. And that resilience means plenty of opportunities for telcos.
Abrutal and lengthy civil war meant that, at one point, Lebanon had one of the highest mobile penetration rates in the world. Part of that was out of necessity: after all, the conflict had destroyed much of the infrastructure for landlines. But it also shows Lebanon is a place where people adopt new technologies quickly – a trend which is continuing today, meaning plenty of opportunities for telecommunications operators, vendors and suppliers looking to expand their customer base.
There are also some advantages. For one, Lebanon is quite small geographically, and has a very urbanised (nearly 9 in 10 Lebanese live in cities, according to the CIA World Factbook) population. It’s also becoming an increasingly popular tourist destination, creating greater need for a variety of different services and offerings.
Yet a number of challenges remain, of course – not least of which include a declining domestic population, large influx of refugees fleeing the civil war in neighbouring Syria, and ongoing geopolitical tensions internally and abroad. Another challenge: very slow Internet speeds – in fact, as widely reported by major international news outlets such as the BBC, Lebanon was ranked in 2011 as having the slowest average Internet speeds in the entire world.
According to market research firm OG Analysis’ 2018 report, Lebanon’s telecommunications industry is a resilient one, adapting to the numerous challenges to provide fertile ground for telcos to increase market share.
Kylie Wansink writes in a 2018 analysis from telecommunications research site Budde Comm that improvements to Lebanon’s fixed infrastructure in particular is offering new opportunities.
“Lebanon’s telecoms market holds a unique position in the Middle East given the level of government involvement. While most incumbents in the region are government owned, within Lebanon, government ownership also extends to the country’s two mobile operators,” writes Wansink.
“The government-owned mobile networks are operated by private companies in return for a management fee, with all revenue going to the government. The two networks are currently operated by Zain of Kuwait (Touch) and Orascom of Egypt (Alfa).”
Wansink goes on to state both operators already offer 4G LTEE services, and are planning on launching 5G services – with the first successful 5G trial in Lebanon having already been conducted.
“The improvements to Lebanon’s broadband infrastructure will boost the already flourishing digital economy as well as the start-up culture that has attracted international interest and recognition.”
Wael Bakhit, of the Faculty of Economics and Management at Lebanese University (and the Faculty of Management at Lebanese French University), writes in a report titled “Disruptive innovation and its implications on Lebanese telecom industry” that the nation’s telecommunications industry is undergoing a period of disruption.
As Bakhit writes: “The mobile telecom industry is changing and the competitive landscape for mobile network operators has been disrupted. The industry is shifting from an environment characterised by reliability and scale of networks, to an environment where choice and flexibility of services is more prominent. This has changed the basis of competition and represents the shift from ‘mobile telephony’ to ‘mobile computing.’ Today, this sector plays a key role in the Lebanese economy even if it’s performing below potential despite growth.”
So, while the Lebanese telecommunications market may
The industry is shifting from an environment characterised by reliability and scale of networks, to an environment where choice and flexibility of services is more prominent. This has changed the basis of competition and represents the shift from ‘mobile telephony’ to ‘mobile computing.’ Today, this sector plays a key role in the Lebanese economy.”
have a ways to go to reach the same level of maturity as, say, the United Arab Emirates, it would appear there’s plenty of room for growth – and for continues resilience and innovation.