Mideast telco players still 'behind the curve' on change in internet usage; regional content ownership lies with Arab social networks.

The fast growth of Middle East online social networks is driving an inflection point in broadband adoption and Internet usage trends, representing a major untapped market opportunity for service providers, according to the white paper entitled The Broadband Revolution, published by Spot On Public Relations, the Middle East's first and leading technology communications consultancy.

'Regional operators and broadcasters are in danger of missing the opportunities that lie with the significant 'movement' in regional attitudes and approaches to content sharing and content generation on the Internet,' said Alexander McNabb, group account director at Spot On.

'For many reasons, telcos in the region have found it hard to look at moving their business models to the type of rich content services that are driving broadband adoption in Europe and Asia. A rising number of people have simply gone out and created their own content.'

The white paper analyses these trends and highlights the current discrepancies between the industry players and consumers. It was launched at the fourth Annual Media & Telecommunications Convergence Conference in Amman yestarday.

The white paper claims that the rise of Consumer Generated Media in the Middle East represents a major market opportunity and a strong reason for operators to take a more aggressive role in pushing broadband adoption. It also points to the fast adoption of Web 2.0 services in the region - and calls on operators to stop blocking such services.

Gianni Catalfamo, technology practice leader, Pleon, says: 'If Web 0 (the Internet without the web) was about sharing information (a document, a paper, some email), then Web 1.0 was about sharing experience (how you do this, tips & tricks, support boards) - but Web 2.0 is about sharing your life.'

Web 2.0 is used to define people's new approach to the Internet and does not refer to a technology or platform. Services and communities such as Facebook.com, YouTube, MySpace and so on are the result of the Web 2.0 'movement.'

The white paper reveals that there is a strong and growing Arab community using broadband technologies to share content on the Internet. A survey of 100 Middle East Facebook.com users revealed that 93% of them use broadband connections. The video featuring King Abdulla II of Jordan produced by the One Voice organisation, calling for peace and understanding between Palestinians and Israelis, has drawn over 279,000 views in Youtube. Video clips on Lebanon have consistently drawn above 150,000 views, while other topics and productions from the Arab world have consistently driven between 60,000 and 1 million views.

'The evidence is here that people are finding these services compelling. Yet broadband access in the Middle East remains far more expensive than in Europe and Asia,' McNabb added. 'Additionally, access speeds available here typically lag other markets: providers in the UK are selling up to 8 Mbit bundles, Japan and Korea offer 100 mbps yet few Middle East ISPs offer higher than 2Mbps.'

According to Arab Advisors Group research, the region's total Internet growth between 2001-2005 averaged at around 6.25%. Broadband penetration is the highest in Bahrain at 5.79% - with the three 'five percenter' markets (Bahrain, Qatar and the UAE) share high GDP and high levels of urbanicity. The low adoption rate is attributed partially by the white paper to prohibitive pricing strategies among the region's operators.

'Although broadband access in the Middle East remains far more expensive in the more advanced markets, price sensitivity is not the only barrier to adoption,' McNabb concludes. 'We are seeing very clear applications for broadband services yestarday thanks to CGM, so the logic of demand generation would suggest that price sensitivity is reduced - that smaller drops in pricing will result in larger percentages of adoption.'

The Fourth Annual Media and Telecommunications Convergence Conference 2007 will take place at the Four Seasons Hotel in Amman on June 4 & 5 2007.