BMI's Executive Summary

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Data released by North Africa's mobile operators for the first half of 2007 reveals a significant slowdown in growth from 2006, particularly in Algeria and Tunisia. In the former, which has been home to some of the fastest growth in the world in recent years, subscriber numbers were up by an estimated 8% in the six months to end-June 2007, a disappointing performance following 63% annual growth in 2006. As a result, we have scaled back our predictions for year-end and beyond, anticipating a total of 25.8mn subscribers by YE07. This would take penetration to 76%, which is still an impressive figure given that at the end of 2003, penetration was less than 5%. In Tunisia, a slowdown had been apparent for some time given the relatively mature state of the market. Nevertheless, the 4% growth seen in H107 was still below expectations and is, we believe, a reflection of the lack of competition in the market. Our current projections forecast a penetration rate of just under 85% by the end of our extended timeframe in 2012, although we may revise this figure should the government go ahead with mooted plans to licence a third operator.

Growth in Morocco was steady and the market remains on track to exceed 19mn subscribers by the end of 2007. However, the really interesting story in the Moroccan market at the moment is in the fixed-wireless services sector. Fixed-wireless services, offering wireless voice connections within a 35km radius, were launched by Wana (previously known as Maroc Connect) in February 2007 and have proved wildly popular. According to the Moroccan regulator, the ANRT, there were 657,000 subscriptions to fixedwireless services by the end of June 2007, accounting for 33.8% of the entire fixed-line market. This is an impressive achievement by Wana and one that has single-handedly stimulated growth in the fixed-line sector as a whole. ANRT data claims that the subscriber base grew by 27% in Q107 and 20.5% in Q2, compared with marginal declines during the preceding quarters.

Despite slowing mobile growth rates, North Africa continues to attract considerable investor interest, which is likely to intensify in 2008 with the expected privatisation of Algerie Telecom. The sale of the Algerian incumbent has been on the cards for some time now, but we believe that the government should begin issuing tender documents in the coming months. The Middle East's major players, such as Etisalat and Qtel, are likely to enter, as are a number of European telecoms operators, including France Telecom and Portugal Telecom. Meanwhile, Tunisia is also expected to push ahead with liberalisation, with news reports suggesting that a second national fixed-line operator could be licensed in the next year in order to break Tunisie Telecom's monopoly.

Contents

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Executive Summary

Chapter - Market Overview

Algeria

Morocco

Tunisia

Chapter - Business Environment Rankings

Table: Africa Business Environment Ranking

Chapter - Industry Forecast Scenario

Table: North Africa Telecoms Sector – Historical Data & Forecasts

Algeria

Morocco

Tunisia

Chapter - Macroeconomic Forecast Scenario

Table: North Africa: Macroeconomic Data And Forecasts

Chapter - Competitive Landscape

Table: Key Players: North Africa Telecoms Sector

Algeria

Table: Algeria Mobile Market Q107

Table: Algeria Mobile ARPUs 2006 (US$/user/month)

Morocco

Mobile

Table: Morocco Mobile Market Q107

Tunisia

Table: Tunisia Mobile Market Q107

Chapter - Company Profiles

Selected Profiles – Operators

Algerie Telecom

Maroc Telecom

Tunisie Telecom

Orascom Telecom

Chapter - BMI Forecast Modelling

How we generate our industry forecasts

Telecommunications Industry

Competitive Landscape for Middle East & Africa Telecommunications Reports: Sample of Companies Ranked

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Commentary on key operators highlighting ownership structures, latest available revenue figures, market share analysis and ARPU counts. BMI forecasts for all headline macroeconomic indicators, including real GDP growth, inflation, fiscal balance, trade balance, current account and external debt. Company SWOTS Covering all leading telecommunications operators and manufacturers operating in each market, including competitive intelligence on geographic presence and competitive positioning against local companies; local market share; leading products, services and technologies; foreign direct investments, projects, merger and acquisition strategies.

Network of Middle Eastern and African Telecommunications Sources

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BMI's Middle Eastern and African Telecommunications Reports are based on an extensive network of multilateral organisations, government departments, telecommunications industry associations, chambers of commerce and company reports. Information sources include: