Ruling the Arab Internet: An Analysis of Internet Ownership Trends of Six Arab Countries
Implications and Conclusion
Internet media is a medium that is going to continue to expand throughout the world, affecting our lives by facilitating the ways we shop, communicate, connect, network, research, understand, and live. This is not a phenomenon foreign or exclusionary to the Arab World. Our findings reinforce the notion that there is a strong economic and political link between Egypt, the UAE, Lebanon, Jordan, and Saudi Arabia. Other countries such as Kuwait and Bahrain are also investing in regional ISPs. Finally, no monopolies exist (with the partial exceptions of Batelco in Bahrain, and Syrian Telecom and SCS–Net in Syria. This is consistent with the information presented by Rinnawi (2011, pp. 126–133)79), but there are emerging oligopolies of Arab Internet media, specifically growing individually out of each of the countries we examined. These companies dominate their opponents, in particularly the smaller ISPs, frequently merge with other companies, and could lead to stifled competition if inter–country oligopolies develop. This is a topic that needs to be explored more thoroughly to reach a deeper conclusion. Moreover, more information needs to be gleaned—especially from the sources to which we could not gain access—that could paint a more holistic and encompassing picture of the economic and political connections that are constantly being made and reforged in the Arab World as consolidation continues.
Our results directly challenge the findings of Varoudakisa & Rossotto (2004), who concluded that: “MENA telecommunications markets remain less open to competition than elsewhere in the developing world [as] competition is hindered, private participation is scarce…while regulatory regimes do not support fair competition” (p. 59, pp. 75–76). Although there is a concentration of ownership in certain Arab countries, and high start–up costs (Rinnawi, 2011), as well as a concentration of other business-conducive resources such as political capital and connections80, can deter a potential entrepreneur or group from starting a company, we argue that competition is not hindered for Arab investors, as Egypt and Lebanon clearly demonstrate. While certain Arab countries such as Bahrain or Jordan may have fewer Internet companies, or countries such as Saudi Arabia and the UAE may have dominant companies, it is inaccurate to assume that applies to all countries within the MENA region. On the hand, it seems accurate that competition is hindered for companies that lie outside of the region, such as European or North American companies.81 Even this, however, is changing, as seen by France Telecom (and more recently, by the Russian company VimpelCom), which is becoming a dominant force among providers of Arab Internet. This may point to Varoudakisa & Rossotto’s (2004) conclusions as simply being outdated.82
Contextualized to the Arab World, the significance of understanding media ownership can be summarized in one word: potential; the potential for control, for setting/perpetuating specific agendas, for new and expanded revenues, and for infrastructure development. Furthermore, as the recent social and political uprisings in the region have illustrated, the Internet is a proxy battleground for state hegemonic dominance, and for the assertion of control and restriction of freedoms. Guns once signified power, but now it is information that dictates and equals money, power, and ultimately, control. As more influence from investors coming with agendas takes hold in other parts of the region, there might be further serious challenges to Internet freedom, Internet security, and Internet development. This is also a two-way street that might lead to more control (e.g., such as Saudi Arabian political and Wahabi Islamic religious ideologies being transported into Lebanon via Lebanese Internet telecommunications investment), or less control (e.g., such as the opposite: “Western,” “liberal,” or “anti–Islamic” ideologies being transported into Saudi Arabia via Saudi Arabian Internet telecommunications investment). This is not farfetched as certain Arab countries are already dominant in other mediums, such as TV. The Internet is no exception, and one thing is certain: with the amount of political and financial investment in the Internet, it is a medium that is not disappearing in the Arab World anytime soon.
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1 This study was originally completed as a research requirement for a graduate seminar (Mass Media in the Modern Arab World) at the American University of Beirut during the 2010 spring semester. The course was co–instructed by: Dr. Nabil Dajani, PhD., and Dr. Jad Melki, PhD. We are very grateful for their assistance, and their suggestions on how to improve this paper.
2 This study was presented at the Global Dilemmas of Security and Development in the Middle East international conference hosted by the Jagiellonian University in Krakow, Poland on 10 November 2010.
3 Michael is a graduate student in the Department of Social and Behavior Sciences pursuing an MA in sociology and the primary correspondent: Box 2127, American University of Beirut, Bliss Street, Beirut, Lebanon. Telephone: +(961) 71–363574. E–mail: email@example.com.
4 Helen is a graduate student in the Institute for Middle East Studies pursuing an MA in Middle Eastern studies with a concentration in conflict resolution.
6 One only has to go so far as to observe the amount of Internet service providers (ISPs) each country has. But the amount of economic and developmental (e.g., infrastructural) potential is huge!
7 Evidence of this is seen in reports coming out of multiple countries—most notably the United States—as the United States Federal Communications Commission (FCC) continues to battle service providers over the issue of “net neutrality.” Part of this battle includes discussion over how much regulatory power ISPs can exert over their clientele base. For more information, see the following articles: Kang, C. (2010, May 7); Wyatt, E. (2010, May 6); Shields, T. (2010, May 6); and McCullagh, D. (2010, April 6).
8 The Internet Society (ISOC) is a Geneva–based, non–profit organization founded in 1992 whose mission is to provide leadership in Internet related standards, education, and policy. They seek to ensure the open development, evolution, and use of the Internet for the benefit of people throughout the world. For more information, see: http://www.isoc.org.
10 He also includes expensive costs, poverty, illiteracy (digital illiteracy in particular), infrastructure, and language barriers (pp. 9–10). Furthermore, limited access, infrastructure limitations, few (if any) regulations or oversight (as well as watchdog groups such as those that exist in the U.S. and Europe) in existence governing company consolidation and mergers including the effect they have on the consumer, and much consumption, but little production (such as blogging) are also issues plaguing Arab Internet.
11 Bahrain and Kuwait were not included, but are still discussed later in this work because of their connection with other Arab countries.
12 The individual websites will be given with the results by country analysis.
13 In fact, many of these emails “bounced back” (having never even been received) even though the contact email address listed on the website was often the email correspondence link specifically for customer service and/or a company inquiry. An interesting occurrence that happened, however, was when we emailed one company whose email “bounced back” to us with a question about rates of service, they promptly sent us the information we requested.
14 Of that outside investment, the majority of it comes from France via France Telecom through Orange, its commercial arm.
15 The only company that had women on its management team was Batelco in Bahrain.
21 Information retrieved from: http://www.link.net/English/Linkcorp/About/Our History/.
24 Reuters (2009, March 23).
25 This is particularly interesting as well because according the Orascom Telecom website (About Us: http://www.orascomtelecom.com/about/Contents/default.aspx?ID=765), Mobinil was O.T.’s “first operation,” and is “one of Egypt’s five largest companies on Cairo & Alexandria Stock Exchange (“CASE”) in terms of market capitalization.”
26 Information retrieved from: http://www.orascomtelecom.com/about/Contents/default.aspx?ID=765.
27 Information retrieved from: http://www.telegeography.com/cu/article.php?article_id=32800.
28 Information retrieved from: http://www.MobiNil.com/aboutMobiNil/shareholder.aspx.
29 VimpelCom “owns Russia’s second–largest mobile phone operator, as well as service providers in Ukraine, Kazakhstan, Uzbekistan, Tajikistan, Georgia, Armenia, Kyrgyzstan, Vietnam, and Cambodia” (BBC, 2010).
32 Information retrieved from: http://www.tedata.net/web/eg/en/default.aspx?sec=25&pr=2.
33 Including operations throughout Egypt and Algeria (http://ir.telecomegypt.com.eg/Company%20Milestones.asp).
34 Information retrieved from: http://ir.telecomegypt.com.eg/Company%20Milestones.asp.
35 Information retrieved from: http://www.tedata.net/web/eg/en/default.aspx?sec=25&pr=2.
37 Information retrieved from: http://ir.telecomegypt.com.eg/Company%20Milestones.asp.
38 Information retrieved from: http://www.vodafone.com/content/index/about/about_us.html.
41 No information could be found on the Jordanian Ministry of Telecommunications website as to the official number of ISPs.
42 Information retrieved from: http://www.batelcogroup.com/portal/en/49/chief–executive–statement.aspx.
43 It is interesting to note, however, that in their Chief Executive Statement on the Batelco Bahrain website, they discuss competition: “In Bahrain, there are now over 75 operators holding 185 licenses. The intense competitive environment, combined with ongoing regulatory reform, is a great motivator to keep us innovating and improving for the benefit of our customers” (Ibid.).
45 Information retrieved from: http://www.batelcogroup.com/portal/en/49/chief–executive–statement.aspx.
46 Information retrieved from: http://www.tedata.net/new/tedata_jordan/en/outer.aspx?secId=72.
49 Information retrieved from: http://ir.telecomegypt.com.eg/Company%20Milestones.asp and http://tinyurl.com/TEDataPressRelease.
50 This has not been updated on TE–Data – Jordan’s website, however.
55 See: OpenNet (2009), and in fact the Syrian Telecom website clearly states that: “…[Syrian Telecom] has the rights exclusively for telecommunications in all parts of the Syrian Arab Republic…” (Information retrieved from: http://ste.gov.sy/index.php?m=58).
56 Information retrieved from: http://www.scs–net.org/portal/AboutSCSNET/tabid/53/Default.aspx
57 Information retrieved from: http://www.scs.org.sy/structureview.php?subtempleid=4.
58 This is further reinforced by the banning of certain websites such as Facebook, YouTube, and online services such as Skype as well as many others claiming they are tools that can be used to communicate with Israel (this includes closely monitoring blog sites as well). Even though many of these bans and restrictions can easily by circumvented by proxies and other services, strong regulation of the Internet and what is posted online (as well as in print, broadcast, and other media) is the norm in the Syrian dictatorship state. For more information, see: Associated Press (2008, March 26); Ali, A. (2007, November 27); and the OpenNet Initiative (2009).
59 Information retrieved from: http://www.internetworldstats.com/me/ae.htm, but although it is cited on the Internet World Stats website, their information is sourced from the Telecommunications Research Associates (TRA) (http://www.tra.com/).
60 Information retrieved from: http://www.internetworldstats.com/me/sa.htm, but although it is cited on the Internet World Stats website, their information is sourced from the International Telecommunication Union (ITU) (http://www.itu.int/en/pages/default.aspx).
61 Information retrieved from: http://www.stc.com.sa/cws/portal/en/stc/stc–landing/stc–lnd–abtsaudtelc.
62 Yunis, E. M. (2003, February 19), accessed from: http://www.isp–planet.com/research/rankings/ksa.html.
63 Ibid., as well as see: https://www.zawya.com/printstory.cfm?storyid=ZAWYA20070417110129&l=110100070417.
64 Information retrieved from: http://www.internetworldstats.com/me/sa.htm, but although it is cited on the Internet World Stats website, their information is sourced from the International Telecommunication Union (ITU) (http://www.itu.int/en/pages/default.aspx).
66 See: Baradei, D. (2006, October).
79 Although Qatar is not included in our analysis, Rinnawi (2011) additionally states that Qatar Telecom (the Q–Tel Company) has a monopoly over Qatari Internet (p. 130).
80 The Arabic term wasta refers to personal connections (and literally means “by means of”) that encompass all forms of political, economic, or social capital that an individual or group may access. This is a very important concept to achieving success in almost any endeavor or career in the Arab world as it alludes to nepotism and favoritism, and reflects widespread corruption.
81 This conclusion may have been particularly displeasing to the institution that commissioned and supported their research: The World Bank.
82 Indeed many of the mergers and acquisitions have only occurred recently since 2005. The study that Varoudakisa & Rossotto (2004) conducted was done almost a decade ago (submitted 1 February 2002 (p. 59), and merely published in 2004).