Kuwait – Telecoms, Mobile and Broadband

Kuwait represents a bright spot for telecoms in the Middle East

Kuwait has one of the highest mobile penetrations in the Middle East and represents a bright spot amongst a region marred by civil tension. The mobile operators in Kuwait are forging ahead and developing both infrastructure and services, with the three major operators of Zain Kuwait, VIVA and Ooredoo all offering LTE services and now also deploying or exploring LTE-A services.

While mobile is booming in Kuwait; the same cannot be said for broadband and fibre deployment. Fixed broadband penetration is low, blamed on underinvestment in infrastructure and the lack of a national broadband policy. The absence of an independent regulator in particular is thought to have been an inhibitor to attracting fixed broadband investment in Kuwait. However this is expected to change with parliament approving plans towards a regulator in 2015 and the actual launch of the new Communication and Information Technology Regulatory Authority (CITRA) taking place in Febraury 2016.

Kuwait’s digital economy will take a boost when fibre infrastructure investment and deployment are improved which will supply the appropriate infrastructure required to full develop a robust digital services sector. In the mean time however, Kuwait is pressing forward and offers a number of e-services. In addition Kuwait is attracting a number of start-ups on the back of the government attempt to diversify its economy beyond oil. It is hoped that the government will fund start-ups initiatives and encourage start-up incubators.

Interest in Machine-to-Machine (M2M) networks and the broader concept of the Internet of Everything (IoT) is beginning to emerge in Kuwait. One example includes the 2015 deal between Zain Kuwait and the Vodafone Group which sees their existing partnership extended to include M2M. While Zain already offers basic M2M services, the new deal will allow Zain to offer enhanced end-to-end M2M solutions.

Overall Kuwait offers a dynamic telecoms sector with a strong bias towards mobile infrastructure and services. The country offers opportunities due to its high penetration of mobile and emerging mobile content and services sector.

Key telecom parameters 2012; 2015

Sector | 2012 | 2015

Subscribers to telecoms services (million): (e)

Fixed Broadband | 0.47 | 0.57

Fixed-line telephony | 0.48 | 0.51

Mobile phone | 5.10 | 8.30

(Source: BuddeComm based on ITU)

Key developments:

In February 2016 Saudi Arabia’s STC gained the majority ownership of VIVA.

In mid 2015 VIVA announced it was the first operator in Kuwait to launched Voice over Long Term Evolution (VoLTE) technology which would allow customers to use LTE networks for making calls including High Definition video calls.

KIPCO, an influential investment firm based in Kuwait, sees great potential for regional Pay TV operator OSN. KIPCO has majority co-ownership of OSN and it has recently demonstrated rising profits and further room for subscriber growth.

The setting up of the first IBM office in Kuwait in 2015 indicates the positive international interest in Kuwait’s ICT market. IBM plans to assist in fostering a knowledge-based economy in Kuwait along with the implementation of green technology projects.

Ooredoo has identified Kuwait as one the markets it wants to further develop and offer mobile financial services too.

Companies covered in this report include:

Ministry of Communications, Qualitynet, Orbit Showtime Network (OSN), KIPCO, Mobile Telecommunications Co (MTC) / Zain, Ooredoo Kuwait (previously National Mobile Telecommunication Co (NMT) / Wataniya Telecom), Kuwait Telecom Company (KTC) / Viva.