Political turmoil tests telecom sector: Egypt rising to meet the challenge

How do political-economic crises affect the telecommunications sector? We take a look at Egypt.
Egypt's telecommunications market showed a strong demand for mobile broadband access throughout the crisis that followed former President Hosni Mubarak's overthrow. Unique subscribers' numbers remained static, but demand for broadband skyrocketed with strong 3G HSPA growth.
Egypt's political crisis drove the economy to its knees. But despite the political, social and economic turmoil in the last three years, the telecoms sector – especially the mobile market and mobile broadband in particular – has proved surprisingly resilient. Relative to the rest of the economy, the Telecommunications Services Industry has performed strongly. That is not to say that the country's three mobile operators (Vodafone Egypt, France Telecom-owned Mobinil and Etisalat Misr) plus fixed-line incumbent and bandwidth wholesaler Telecom Egypt have come through unscathed.
Three moments of drastic decline in revenue growth occurred: at the overthrow of long-term dictator Hosni Mubarak in 1Q11, the installation of the Muhamad Morsi-led Muslim Brotherhood government in June 2012, and the military coup which overthrew it just over a year later.
Despite these bumps in the road, the mobile industry seems well on the way to recovery. Year-on-year revenue growth had recovered to 10% by the end of 2Q13, and the signs are that growth will hold up or increase in 2014 – this in spite of a real economic growth average of 2%. The increase in revenues has led to operators once again being able to increase their capital expenditure on new infrastructure, particularly 3G cell sites.
Of particular note is the pent-up demand for mobile data, with figures released by Vodafone Egypt showing the operator achieving a YoY growth in mobile data traffic from 20% in 2Q12 to more than 120% in 3Q13. The annualized growth in mobile broadband connections has been holding steady at around 120% since 4Q11. This could bode well for operators' ARPU, which is currently a modest $4 per month.
Check Vodafone Egypt's 3G offers: http://www.vodafone.com.eg/vodafoneportalWeb/en/mobileBroadband_book
..and this Mobinil dongle advertisement: http://www.coloribus.com/adsarchive/tv-commercials/mobile-broadband-internet-robbie-williams-12928405/