Overview of Telecommunications Sector in Kuwait Article

Overview of Telecommunications Sector in Kuwait - Article Example This has worked against Wataniya Telecom, for example, the company had to drop charges on incoming calls. In early 2009, there was a shift from mobile-to-mobile calls because charges for calling from fixed lines to mobile were abolished. This has resulted in the APRU levels declining and tighter competition prompting consumer price reduction. Telecoms revenues dropped to KD475.5m ($1.66bn) in 2009 from KD476m ($1.66bn) in 2008 though there was a 31.4% increase in net profits from KD82.4m ($288m) in 2008 to KD108.3m ($378.5m), 2009 (Business Management International 2010) Even as prices go down, the Telecommunications sector in the country is experiencing elasticity and is expecting further growth in subscriptions. There has also been an increased use of cell phones due to lower tariffs. This puts the sector in position to make up for the reduced revenue through increased utilisation of value-added services. The main focus in this sector now is the increase of broadband and mobile int ernet services. One telecommunications company in this sector, Wataniya’s recently acquired revenues of about 43%, and is a very important revenue generator for the country. At the end of 2009, some other companies in the sector were also very profitable. Telecom held 39% of the Kuwait market as compared to 15% for Viva and 46% for Zain, which are all companies in Kuwait telecommunications sector. Telecom also took about 30% of the new telecommunications subscriptions, as compared to 61% for Viva. The Telecommunications sector in Kuwait bundles its services, unlike other telecommunication companies. However, they sell handsets separately except for Blackberry and iPhone which are under promotion. Customers are given Blackberry and iPhone handsets for free after acquiring a pre-paid subscription and operating on pay-as-you-go basis. This has led to increased usage of mobile internet, therefore, a source for revenue from non-voice services.