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1
The Impact of Regulation, Socio-economics
Technology on the Arab Internet Market

• Michael Minges
• International Telecommunication Union

The views expressed are those of the author and
may not necessarily reflect the opinions of the
ITU or its Members.
2
Internet in the Arab World
Source ITU adapted from DITnet.
3
Wealth Internet
10.00
UAE
Qatar
Bahrain
Lebanon
Oman
Jordan
1.00
Tunisia
2
R
0.68
Egypt
Saudi Arabia
Morocco
0.10
Internet users, of population
0.01
Algeria
0.00
0
5'000
10'000
15'000
20'000
GNP per capita, US
Source ITU adapted from DITnet and World Bank
data.
4
Internet absorbtion hard factors Rather have a
cellphone
Source ITU, DITnet (Internet subscribers).
5
Internet absorbtion soft factors
Source UNDP.
6
Regulatory issuesDepends on viewpoint

• Government
• Content
• Internet telephony
• Market structure

• User with access
• Speed
• Pricing
• Quality
• Privacy
• Security
• Services
• Support
• Content
• User without access
• Access

• ISP
• Pricing
• Service from incumbent phone company
• Peering

7
Internet pricing
Ten hours of dial-up Internet usage per month, US
30
Number of ISPs
14
Telephone call charge
2
1
Internet monthly charge
Internet call charge
Source ITU adapted from ISP and PTO data.
8
UAE Internet

• UAE has more than half of the Internet host
  computers in region
• Etisalat largest ISP in region
• Emirates Internet Exchange
• Dubai Internet City

http//www.emix.net.ae/network.html
9
Internet Telephony
Price per minute, telephone traffic US, February
2000

• What is Internet Telephony?
• VoIP or
• Extra revenue for telephone company
• VoIP already happening despite legal ban

Source ITU adapted from Arbinet, FCC.
10
Internet TelephonyAnother perspective

• Internet can be beneficial to telephone companies
• Extra local traffic, 2nd lines, ISDN, leased lines

Source Hongkong Telecom.
11
Content

• Overblown issue
• Has serious implications for Internet diffusion
• Local content development

http//www.idsc.gov.eg/index.htm
12
Universal access
Household telephone penetration

• Internet friendly tariffs
• Public access points

Source ITU.
13
Tunisian Publinet

• PubLIC INTERnet
• Started in October 1998
• 50 of investment cost met by government rest
  from low interest loans

Source ATI (www.ati.tn)
14
If we only had WebTV
Household TV penetration

• Other ways of accessing Internet
• Much higher penetration of TV than telephone or
  computers

Source ITU adapted from national data and
European Audiovisual Observatory.
15
Conclusions

• Allow ISPs to offer own international gateways
  and leased lines and even access lines if
  telephone companies are uncooperative
• Develop local content, particularly government
  services
• Promote Internet-friendly dial-up local telephone
  charges
• Establish public access policies
• Telephone companies are missing out on
  significant revenue source
• Raise awareness, increase training and education