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We pay 85% more than Turkey, 85.5% more than Ireland and 83.1% more than Sweden for our broadband. This should come as no surprise (consider that the Japanese pay $0.27 per megabit per month for broadband and these other figures look positively benign). What is, perhaps, a surprise is that the news comes to us via Emirates Business 24x7.
A special committee reporting to the UAE Federal National Council has found that prices of telecommunications services are higher than those in several Arab and European nations refuting, according to Emirates Business 24x7, “The common perception that telecom charges in the UAE are low...”
Refuting a common perception among the mentally deranged, perhaps chaps, but I think you’ll find that the rest of us know perfectly well that we’re being gouged on an intergalactic scale by a cosy duopoly buoyed by a compliant regulator.
The EmBiz story reports that telecom prices across the OECD are, on average, 66% lower than in the UAE. The picture’s even more depressing when you look at the prices business users are paying for broadband – 91.1% more than Morocco, 83% more than Ireland and so on. In fact, prices in Europe are, on average, 95.1% lower for broadband connectivity.
The committee has concluded, in telling words, that “...in the past three years there has been no benefit from competition for consumers.”
In fact, the report hands out a pretty comprehensive drubbing to the TRA, pointing to the effective monopolies that the two telcos have established over certain areas, the lack of subscriber focus in regulation and generally accused the TRA of “failure”.
It’s a no-brainer that low-cost, high speed, highly available broadband is a critical element in supporting economic development in the Internet age. Jordan reacted to that need, expressed at the Dead Sea Forum in 1999 with the privatisation of Jordan Telecom, a move that started the country’s march towards being the region’s most competitive telecom market and where significant economic value is being generated by a dynamic and burgeoning Web-based technology industry. Egypt has seen blisteringly fast adoption of broadband and, once again, is seeing significant and growing economic value being generated through its online capabilities.
The UAE, once the leading telecom market in the Arab World (and actually pretty far ahead of the rest of the world at one stage – the UAE was 100% fibre-optic before the UK, for instance) is fast dropping behind. We’re paying too much for broadband at both the domestic and business level and it’s hampering adoption and innovation. We’re seeing an increasing number of Internet-based innovations (including, but by no means limited to, VoIP) being used as a business advantage elsewhere while our operators continue to cling to circuit-switched pricing models at the expense of their customers' business competitiveness.
Low-cost, high speed Internet access could, and should, be a major advantage being offered to businesses wishing to set up in the UAE to serve regional markets. And it's not - it's actually a major disadvantage. A trading economy, the UAE’s businesspeople can’t even use mobile data services when they’re travelling overseas because roaming data tariffs are insanely high. And those mobile services are going to become increasingly key to us all.
It’s good that the FNC committee has highlighted the massive discrepancies in value, despite the operators’ claims that they’re price competitive and great that its work has resulted in a resounding wake-up call for the regulator to be more subscriber focused.
Will anything change as a result? I remain, as always, optimistic...
(Interestingly, the committee found that 6,629 complaints had been logged about Etisalat’s mobile service quality, against a whopping 57,062 complaints about Du’s mobile service quality – a number made even more impressive by Du’s lower subscriber base.)