CAIRO: The number of mobile subscribers in Egypt reached 70.66 million in December 2010, up from 55.232 million in December 2009, according to figures released by the Information and Decision Support Center. This is an increase of about 27.7 percent or 15.308 million users over the past year. Egypt has a population of more than 80 million people. “There were expected high levels of growth from 2007 to 2009, but due to the high increase the potential for high growth rate in 2010 was somewhat limited,” said Ahmed Adel, a research analyst at Naeem Brokerage. He added that compared to the growth rate that was seen from 2007-2009, such as the 34 percent growth that was seen in 2009, the past year actually saw a decline. The three mobile operators currently established and working in Egypt are Mobinil, Vodafone and Etisalat. “Due to the good work from the operators in the country, the competition was taken to high levels and this was very clear during the third quarter during Ramadan of this past year,” Adel told Daily News Egypt in a phone interview. “Mobinil and Vodafone were racing for the number one market share and Mobinil had the number one spot until the fourth quarter when Vodafone moved up to number one,” he said of 2010. Vodafone holds about 45 percent of the market share while Mobinil is at an estimated 42.8 percent, and Etisalat approximately 12.2 percent. As far as the competition between operators, Adel suggests that the competition has already been taken to an already low level, such as the price per minute decrease that was seen in 2009 due to the competition, that it would be hard to expect the companies to take it any lower. Adel also implies that the high number of users could also be attributed to the fact that some subscribers carry multiple SIM cards, which is not uncommon among some Egyptians. It has been proposed by some that fixed lines are being replaced by the mobile phones, which could be true, but in 2009 there were about 1.5 million users with a fixed line and this number declined by about 9.3-9.5 percent in 2010 for various reasons. With only one fixed line company in the country, Telecom Egypt has no other competition in its sector, but it does have to compete with mobile operators. “Telecom Egypt offered very high promotions, such as free installations or “Kalam 12” with various free minutes to maintain its subscriber base and compete with mobile subscribers,” said Adel. Slower growth is expected for the mobile sector due to the events of the recent revolution. “First quarter numbers will not be that impressive due to the recent events, but the growth rate by the end of 2011 is expected to be about 15 percent,” said Adel, adding that the number of subscribers would increase by 10 million even with the dampening effect of the uprising. This increase would increase the cellular penetration to an estimated 96 percent and break 100 percent in 2012. In terms of the competition, the current year should see Mobinil and Vodafone continue to contend for the number one spot and trade back and forth, but in terms of revenue share, Vodafone is expected to remain on top. The next couple years could bring stability with the demand moving from being relatively elastic to becoming inelastic. “Going forward, operators may focus on service differentiation rather than on cut-throat pricing, which will suggest a more stable market in 2011,” said Adel.
