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Tunisia: Tunisie Telecom under pressure, according to Onda Analytics

Telecoms sector in Tunisia braced for change as France Telecom plans to start operations and government plans privatisation drive, according to new report from Onda Analytics.

The Tunisian telecoms market appears to be set for a major shake-up in 2010, with France Telecom due to start fixed and mobile operations amid increasing speculation that foreign operators might seek to buy stakes in the country’s incumbent operator Tunisie Télécom, according to UK-based researcher Onda Analytics.

While France Telecom is expected to start operations in Tunisia in early 2010, Onda Analytics reckons the market could also be stimulated by interest from “outside parties” in the 35% stake in Tunisie Télécom that is currently held by EIT, a holding company for telecoms investments made by Dubai Holdings.

The increasingly competitive environment in Tunisia may prompt EIT to consider listening to offers from operators interested in joining the market, according to Onda Analytics.

Meanwhile, the other 65% shareholding is owned by the Tunisian government, which recently announced a privatisation drive for 2010.

“As a result of the pressure from both France Telecom and existing mobile operator Tunisiana, Tunisie Télécom must pursue measures to defend its current market position,” said Daniel Jones, lead author of the report.

“Many MENA operators have experience of defending against strong competition and are looking for attractive acquisition targets. As a result of the benefits this experience could bring to Tunisie Télécom, these parties’ valuations may provoke EIT’s interest.”

The report added that Tunisie Télécom is likely to suffer most from the entry of France Telecom, which will be present in fixed line, broadband and mobile markets. Tunisie Télécom’s mobile market share is forecast to decline from 50% in 2009 to 34% by 2018, while its fixed share is expected to fall by 23% by 2018.

But the overall outlook for the Tunisian market looks positive, with total mobile revenue forecast to grow modestly over the coming years as competition drives tariffs down.

Fixed line growth is also expected to buck the trend of many markets with a forecast increase in lines of 30% to 2018, from 1.4 million in 2009, driven by the adoption of broadband services, the report added.


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