x Abu Dhabi, UAEThursday 27 July 2017

UAE subscribers paying high price for broadband

Entry level broadband subscriptions cost $868 a year in the UAE - more than eight times the cost in countries such as Russia, India and the Ukraine.

The UAE and other Middle East countries are among the most expensive places to log on in the emerging markets, according to a report by the consultancy firm Ovum. Andrew Henderson / The National
The UAE and other Middle East countries are among the most expensive places to log on in the emerging markets, according to a report by the consultancy firm Ovum. Andrew Henderson / The National

Broadband connections in the UAE and the Middle East are among the most expensive worldwide, with high-end subscriptions costing more than Dh8,000 (US$2,178) a year.

Entry level digital subscriber line (DSL) subscriptions cost $868 annually in the UAE - more than eight times the cost of a basic connection in countries such as Russia, India and Ukraine.

That places the UAE and other Middle East countries among the most expensive places to log on in the emerging markets, according to a report by the consultancy firm Ovum.

The UAE is "one of the more expensive countries for broadband", said Richard Hurst, the senior analyst for emerging markets at Ovum.

Ovum measured internet connection costs in 19 emerging markets, including the UAE, Saudi Arabia and Egypt, for its report "Broadband Pricing in Emerging Markets in 2011".

The Middle East countries were found to be among the costliest for home broadband services.

"In the Middle East, they are between eight and 10 times more [expensive] than central or eastern Europe," Mr Hurst said.

The $868 annual fee for a basic broadband connection with Etisalat was the third most expensive of all 19 countries surveyed by Ovum. Only South Africa, where a basic connection costs $1,443 a year, and Nigeria, at $1,211, were more costly.

Etisalat has the fastest maximum broadband speed of all countries surveyed, Ovum said. But it is also one of the priciest, at Dh699 per month for a claimed 30Mbps connection.

While internet services may be relatively expensive in the Middle East, they were deemed more affordable because of higher wages in the region, compared with many countries in Africa.

"The UAE had some of the most expensive broadband services in our sample, but the country's high GDP per capita means that broadband is affordable for the majority of the population," the report said.

The Ovum study found that even as broadband costs decline overall, services continue to be unaffordable for the majority of emerging-market customers.

The average prices of entry-level and high-end DSL packages fell by 11 per cent and 1 per cent respectively.

"Demand for broadband services in emerging markets continues to be stifled by high prices," Mr Hurst said.

"In some countries, broadband pricing was double or triple the price of an equivalent service in a more developed market."

bflanagan@thenational.ae