The telecoms operator du is accelerating its rollout of 4G as demand for fast internet speeds grows, helped by rapidly rising smartphone sales.
The company said it would grow its 4G LTE network by 25 per cent beyond its original expansion plans for this year as Dubai aims to become a smart city.
The high-speed 4G LTE technology offers better connectivity for people who want to stream video on their phones, use VoIP applications, or need faster download speeds.
“Our internal analysis and monitoring of data usage patterns on our network has shown very healthy growth, in line with global trends,” said Saleem Albalooshi, executive vice president of network development and operations at du. “In order to provide our customers with the best experience, we have added value to our network by increasing it beyond our original plans for 2014.”
Analysts say that the high level of smartphone penetration in the UAE market is the main driver behind du’s network expansion.
“Our view is that the take-up of LTE in the UAE, as well as generally in the GCC, has grown strongly recently, with one of the main factors behind this being the fact that many more smartphone models – and increasingly those at mid-market prices as well as the top-end devices – are now LTE-enabled,” said Matthew Reed, an analyst at Ovum.
For the first three months of this year, 52 per cent of the handsets registered in the UAE were smartphones, up 10 per cent compared to the same period in 2013, the latest government statistics showed.
Information from the International Data Corporation (IDC) revealed that most retail markets with higher average spending – such as the UAE and Saudi Arabia – are near saturation in terms of high-cost devices such as the Apple iPhone 5. Also, demand for second phones in the UAE and Saudi has been rising as smartphone penetration exceeds 100 per cent.
“Telecom operators worldwide and in the UAE need to continuously evolve their network and support the higher bandwidth to make sure that customers are receiving good quality service,” said Bhanu Chaddha, an analyst at IDC.
“For this purpose, telecom operators need to continuously improve the capacity of their network and prepare for next generation technology, or make sure that the network is feature ready,” he added.
Du said that its latest technology enhancement matches Dubai’s initiative to become a smart city.
Last year, Sheikh Mohammed bin Rashid, Vice President of the UAE and Ruler of Dubai, announced his vision to turn Dubai into a smart city, where government services are accessed via smart devices using free high-speed internet connection.
“Mobile broadband infrastructure is a very important foundation of the experience of a smart city. Mobile broadband is an integral part of the vision of a smart city,” said Mr Chaddha.
“A smart city unleashes the vision of a connected society that utilises information to enrich the lives of the people.”
Selling data packages and super-fast connection speeds is helping telecoms operators such as du and Etisalat as revenue declines from traditional fixed lines. The increasing popularity of VoIP applications such as Skype and Viber is putting increasing pressure on their margins. The rapid increase in data usage is helping to mitigate that impact.
Du reported a 15.5 per cent increase in profits for the second quarter to Dh548 million. It said that mobile data revenues now represent 29.3 per cent of its total mobile revenue compared to 27.1 per cent in the same quarter a year ago.
selgazzar@thenational.ae
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