[Satellite News 01-26-10] The commercial mobile services market is thriving in Afghanistan due to a steady increase in government platforms and technology investments, according to Jan. 21 report released by analysis firm NSR.
    The report shows that commercial mobile penetration in Afghanistan increased 18 percent from 2007 to 2009, with 30 percent of the country’s 28.4 million citizens now owning and operating cell phones. NSR analysts claim that this will lead to growth in other mobile markets in the region and the country is positioned for higher bandwidth usage with the development of the mobile web for e-commerce.
    “Internet penetration was still relatively low at 2 percent [at the end of 2009], but this was definitely a marked improvement compared to 2002 levels. More importantly, the mobile web is likely where the next wave of wireless growth will take place. Also worth noting is that the country’s telecommunications and IT sector employs more than 50,000 people, and the country is positioning itself to open opportunities for trade between districts as well as with other countries,” NSR said in the report.
    NSR’s projections are supported by a number of recent service launches and financial investments in Afghanistan driven by reduced operational costs for suppliers and providers. In December, iDirect announced that SpaceCom deployed a GSM cellular backhaul service based on iDirect’s satellite communications platform to rural sites in Afghanistan with immediate plans to expand throughout South and Central Asia, resulting in bandwidth cost savings for GSM operators.
    In 2007, Afghanistan saw the launch of its fourth cell phone service provider, Etisalat, backed by a $300 million investment to set up the service. In August 2008, the Asian Development Bank provided a $55 million loan to Telecom Development Company Afghanistan for its coverage expansion.
    These trends, according to NSR, reveal solid growth opportunities for satellite backhaul providers that outweigh the risks of investing in a politically unstable environment. “Satellite-based companies are finding niche opportunities on the ground for mainstream markets, and this trend is expected to continue as mobile penetration improves further from the current 30 percent … It will not be surprising to see increased competition in the Afghan satellite backhaul market, which is a healthy development for both Afghanistan and the satellite industry. Satellite backhaul may become a key component in the wireless ecosystem and may be credited for being a key component in Afghanistan’s increased mobile and Internet penetration rates by the end of 2010.”