ADSL prices now below Arab average for capped plans; 3G prices above average

7 Nov 2011

Lebanon’s Telecommunications Regulatory Authority (TRA) has presented a study showing that prices for consumer and corporate ADSL broadband internet packages with capped data usage are now cheaper than the average across Arab countries, following the recent connection to additional international bandwidth and a state decree which mandated price drops and speed increases. Although a significant number of areas in the country are still awaiting the full implementation of new speeds via DSL access network upgrades and domestic fibre backbone rollouts, the retail price reductions have been experienced nationwide, whilst wholesale international bandwidth costs are also now lower than the Arab country average. The TRA’s presentation showed that new ADSL tariffs for low data usage customers, capped at 2GB per month, were priced at 23% below the Arab average, while ‘high-usage’ (6GB) ADSL tariffs were priced at the regional average (USD28), although data speeds were not compared. In the corporate broadband segment, Lebanon’s prices came out as significantly lower than average using the same comparison criteria: by 59% in the case of 2GB plans and 75% lower for a 6GB monthly tariff. International bandwidth and international leased circuits are now ‘significantly’ lower than the Arab average, the regulator added. Prior to the market shake-up, a similar regional study published by Bahrain’s national telecoms regulator showed that Lebanon had the highest-priced broadband in the Middle East for low-speed (256kbps), ‘high’ usage (6GB a month) services, as of March 2011.

In July 2011 the Lebanese communications ministry announced that ISPs were to be granted retail and wholesale access to increased international internet capacity via the India-Middle East-Western Europe (IMEWE) submarine cable, and the promise was formalised by decree in September, which mandated an 80% reduction in the cost of DSL bandwidth to the consumer, an increase in retail broadband speeds by between four and eight times – up to 8Mbps – and a rise in monthly download limits. On 1 October 2011 state-run incumbent telco Ogero announced the launch of new internet packages, including a minimum 1Mbps ADSL service across ‘the majority’ of the country for its retail end-users and wholesale ISP customers. Upgrades to another cable system, Cadmos, will also boost the country’s available bandwidth, helping to raise speeds and lower prices.

Meanwhile, in the same presentation, the TRA revealed that the price of 3G mobile services in Lebanon is between 23% and 25% higher than average across the Arab world. The official launch of commercial 3G mobile broadband services took place in the country on 1 November 2011, courtesy of the two state-owned cellcos Alfa and MTC Touch. In subsequent stages of 3G development, the TRA said, the two cellcos will leverage economies of scale to significantly reduce prices as 3G device ownership increases.

Lebanon, Alfa (MIC 1), Ogero Telecom, Touch Lebanon (MIC 2)