Published Date: 29/07/2008
Market Research Report Title:
Iran Telecommunications Report Q3 2008
Table of Contents:
Report Type: Market Report
Number of Pages: 55
In the first three months of 2008, the number of Iranian cellular subscribers
grew by an estimated 22.6% to reach 35.049mn; which helped to increase mobile
penetration to 49.4%. It appears that much of the growth can be attributed to
the continued expansion of MTN Irancell, which is owned by South Africa's MTN
Group. MTN Irancell ended 2007 with an even larger mobile customer base than we
had predicted (6.006mn). Furthermore, in Q108, MTN Irancell's customer base
expanded by over 50% to reach 9.025mn at the end of March 2008. This allowed MTN
Irancell to raise its market share to almost 28%, up from 21% in December 2007
and 6.4% in March 2007.
Due to the stronger than expected subscriber
growth in Q108, we have revised our previous set of mobile forecast figures. We
now predict that the sector will grow by 60% in 2008, enabling penetration to
rise to over 64% by the end of the year. Meanwhile, it was reported in May 2008
that Russian cellco MegaFon had declared its intention to bid for Iran's fourth
national mobile licence when it becomes available. The Iranian government is
expected to offer a new mobile licence later in 2008, with the new licensee
competing with established operators Telecommunications Company of Iran (TCI),
MTN Irancell and Taliya. MegaFon has said that it is prepared to invest around
US$4.6bn in the construction of a GSM network in Iran.
Iran's Ministry of ICT has suggested that, once
issued, Iran's new mobile licence will include access to the spectrum necessary
to provide 3G services. The Ministry has also said that foreign operators will
only be able to have a 49% stake in the new mobile operation and that Iranian
companies will be able to participate in the tender in the form of a consortium.
At the time of writing, there has been no real
progress with plans to privatise Iranian fixed-line incumbent, TCI. In September
2007, the Ministry of ICT announced that 51% of TCI would be privatised before
the end of the Iranian calendar year on 20 March 2008. As a forerunner to the
sale of a controlling stake in TCI, a 5% stake in the operator was scheduled be
floated on the Tehran Stock Exchange before the end of December 2007. The
floatation of this minority stake did not take place as planned, and in January
2008 it was reported that TCI would first have to be established as a
fully-licensed telecoms service provider.
In April 2008, Iran Telecom Chairman, Saaber
Feizi, reported as saying that the various companies which constitute Iran
Telecom were interconnected in such a way as to make it impossible to separate
them when the company is eventually offered for sale on the Stock Exchange.
Feizi therefore stressed that Iran Telecom would be sold along with all its
subsidiaries, including mobile business unit Mobile Communications Company of
Iran continues to sit at the bottom of our
Business Environment Rankings for the Middle East, although the country now sits
in tenth rather than eleventh place, due to inclusion of Iraq in our latest set
of figures. Iran's own score has fallen in the current update, and this is the
result of the lower score which the country receives in the telecoms market
category. The reduced score in the telecoms market category largely reflects the
perceived impact of a number of recent moves by the Iranian authorities in
favour of imposing stricter controls on the use of internet and mobile data
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