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October 17, 2012

Frost and Sullivan Study Reveals Mobile Telephony Services to Take Over Moroccan Telecom Fixed Line Services

A new analysis by Frost and Sullivan revealed mobile telephony to take over Moroccan Telecom fixed line services. A comparatively poor penetration of 11.1 percent for fixed line services is driving the growth of mobile service in Morocco. This is especially true for remote locations where mobile telephony services have penetrated easily and better than fixed line telecom services in the country.

It is expected that increasing demand and prevalence of broadband and value-added services among young users will encourage mobile network service providers to offer innovative content and applications like SMS quizzes and mobile lotteries to the discerning crowd. According to the new analysis by Frost and Sullivan, the Morocco Telecom market has earned approximately $6.32 billion in revenue for 2011, and is estimated to touch $7.42 billion by 2018.

According to Jonas Zelba, senior research analyst, Frost and Sullivan, “The Moroccan telecom market will also benefit from the advanced regulatory environment, which fosters competitive conditions. On the other hand, intense competition is stoking price wars and thereby, slashing operating margins.”

Zelba added that it is estimated that subscriber growth will be higher than mobile revenue growth because of new low-income subscribers and reduced tariffs, which tend to decrease average revenue per user.

Mobile network operators should concede that they are expecting a new wave in subscriber growth from low-income consumers itself. Besides advanced and innovative value-added services offered to high-end subscribers, the operators should deliver more simplified and effective broadband services to have a deeper penetration into the low-income group in an efficient manner, suggested the analysis from Frost and Sullivan. It is expected that such targeted broadband services will also help the operator to better churn, manage, and increase growth in low-income subscribers as a whole.

Morocco Telecom is an important part of Mobile and Wireless Communications Growth Partnership Services Program. It is recommended that the country can leverage on its valuable geographical location since several big companies from Europe, and especially France, consider the country to be a lucrative outsourcing destination. And this opportunity can be leveraged upon by providing them call center services and generate higher growth in mobile market.

Zelba feels that these investors will be looking to outsource their production, customer service and call centers to reduce costs. He also said that telecom operators can gain additional revenue streams by providing them with call centers and becoming a third-party service provider.

However, this was only a suggestion from Frost and Sullivan, based on the report they presented with their analysis, and it lies at the discretion of telecom operators whether they will utilize the opportunity towards lucrative growth prospects in mobile market in Morocco.

Edited by Brooke Neuman

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