- UAE prices double Bahrain’s
- Infrastructure costs push up bills
- Qatari users pay lowest
Telcos may have generated nearly AED94 billion ($25 billion) in revenue for the UAE government, but a lack of competition and steep costs means that residents have been hit with the highest broadband bills in the Gulf.
With an average price of $142.65 per month, people in the UAE are paying more than double than those in Bahrain, which boasts the Gulf’s lowest price at an average of $66.61 per month.
Across the whole of the Middle East only Yemenis pay more per month to access broadband internet than in the UAE.
Residents in the emirates are also paying $4.31 per megabit of data – no other country in the Gulf pays more than an average of $0.50.
While Qataris may be among the Gulf’s higher monthly payers, they are getting more bang for their buck as they pay only $0.06 for one megabit of data, the Middle East’s lowest figure.
A report by UK-based broadband price comparison website Cable.co.uk found that broadband prices are significantly lower across the wider Middle East region, apart from Yemen.
The data showed that the global average price of broadband dropped 1.8 percent to $55.89 this year.
In Turkey, which is home to the Middle East’s lowest broadband price, the average paid (based on August 2024 exchange rates) is only $10.56 per month – less than half the next lowest price, which is found in Lebanon at $21.84 per month.
While it may cost the lowest on average, Turkey has one of the most expensive broadband packages available around the globe.
For 58,999.90 Turkish Lira, around $1,758, consumers can access soNET’s Bugatti package, which provides download speeds of up to 5,000 mbps — enough to download a new, high-definition film every five seconds.
Sudan had the cheapest average broadband price in the world, with residents paying $2.40 per month. The most expensive was found in the Solomon Islands, where residents pay an average of $457.84 per month.
The higher bills in the UAE have certainly helped the balance sheets of the Gulf state’s telcos. Abu Dhabi-listed e& – commonly known as Etisalat – reported revenues of AED28 billion ($7.7 billion), rising 6 percent year on year in the first half of 2024, resulting in net profit rising 17 percent to AED5.5 billion.
Emirates Integrated Telecommunications Company (EITC), which operates the du and Virgin mobile brands in the UAE, benefitted from a first-half profit rise of 54 percent year on year to AED1.2 billion as revenue grew 6 percent year on year to AED7.2 billion.
Dana Ramadan, London-based senior policy analyst for data governance and digital Transformation at Access Partnership, pointed out that “this duopolistic structure likely contributes to the UAE’s low affordability ranking”.
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Combined, the two telcos have returned AED93.8 billion in royalties to their owners, the UAE government, between 2012 and June this year, which Ramadan said was another factor adding to the larger bills for UAE consumers.
The research by Cable.co.uk showed that the market was more diversified in other regional markets. It surveyed four broadband packages on offer in the UAE, while 16 packages were on offer in Saudi Arabia and 36 in Turkey.
Ramadan said opening up the UAE market to more operators would help to reduce bills for residents in the emirates.
“As the UAE prepares for its 6G rollout by 2030, opening the market to foreign operators and liberalising it to attract investors could foster competition, driving innovation and affordability.”
However, Ismael Moreno-Gomez, manager at TMT consultants Analysys Mason, said that the increased cost of infrastructure in the region was a key factor in the higher bills.
The rollout of a new technology to provide broadband services such as fibre to the home may have a significant impact on pricing.
Operators deploying a new technology typically incur a significant amount of upfront capital expenditure followed by a more moderate operational expenditure to continue providing services, Moreno-Gomez said.
“The capital expenditure varies significantly by region or geography, with Gulf countries having higher than average costs,” he said.
“For example, the cost to dig a trench to lay the fibre cable in the UAE or Saudi Arabia is much higher than the cost in India when factoring labour, terrain, deployment approach, and more.”