The market for value added services in the Middle East and North Africa (MENA) region is one that is growing rapidly. Ripe with opportunity and, while many of the services that are popular are the same as everywhere else in the world, it does offer some unique advantages.
According to the GSMA there are around 400 million mobile users in the region, predicted to grow to more than 450 million by 2025. 264 million of them are mobile internet users. 60% of mobile users have a smartphone, while there are 636 million SIM cards in use.
Together this makes for a massive mobile market and, with 4G penetration across the region rising rapidly to account for some 52% of connectivity, the use of value added services in the region is only set to grow and grow.
One company that is capitalising on its long-established presence across MENA is MobiMind. The VAS company turned aggregator operates in 13 key countries across the region, including Saudi Arabi, Kuwait, UAE, Iraq, Egypt and Tunisia – as well as making its presence felt in the wider African market with a new operation in Nigeria.
It has seen first-hand how this mobilisation of consumers across the region is reshaping the whole VAS market and offering unprecedented content, billing and network opportunities.
“The region has a very dynamic, tech-savvy and youthful population and so consumer demand for content and VAS on mobile has grown rapidly year on year and continues to grow,” says Naji Bou Harb, CEO at MobiMind (pictured, left). “The market is very competitive, but offers huge potential. But to meet the demand requires a lot of technology and a lot of advanced products to keep attracting users.”
Content, religion and carrier billing
Bou Harb says that, as you’d expect, the content market on mobile is dominated by games, video streaming, music and entertainment services. Mcommerce is also increasingly popular – not least from the pandemic lockdowns. The market is also a world-leader in health and wellbeing and education.
However, these services only account for 70% of the free and paid for content market. The other 30% lies in religious content – something not seen outside the MENA region and which comes with its own opportunities and challenges.
“There is a range of religious education content and content for religious communities which is a mixture of paid-for and very low-cost, much of it paid for as one of payments using DCB and others based around subscription services,” says Bou Harb.
MobiMind sees most of the payments for all content, religious or otherwise, coming through carrier billing (DCB) and premium SMS (PSMS), often with the consumer not that bothered as to which.
“These payment methods are hugely popular in the markets we operate in because they really meet the needs of the customer base,” says Bou Harb. “The youthful user base are mobile centric and want mobile payments – both because they are on mobile, but also because they just use mobile all the time for everything. It also fits better with their financial situation. Most are young, don’t have credit cards or bank accounts and are given money to spend on their mobile by their parents. Carrier billing/PSMS allows them to readily pay for what they want with their bill or credit.”
Carrier billing is also key to content consumption because it is easy and secure. “It’s such a simple process to pay that it really appeals to young tech savvy users,” he says. “There is also the security around paying this way that requires no sharing of personal information, no card or bank details and is pretty anonymous.”
Mobile data is key
Data from Statista suggests that across the MENA region, around 52% of network users are now on 4G – a number that is rising. This shift from 2 to 3 to 4G in a few short years adds to the competitiveness of the market across MENA, with users demanding ever more sophisticated and rich services to use on their smartphones.
The arrival of 5G – which is slowly creeping across the region, with Statista saying that, as of 2021, there were around 150m 5G subscribers in MENA – is only going to up the ante for service providers and VAS companies.
“5G will drive everything from video streaming to interactive games. It will force every player in the market to think more of the content quality and to create innovative new services on 5G,” says Bou Harb.
“And this will drive DCB,” he adds. “The more and better content that 5G will deliver will see more consumers buy more stuff and that will mean using more DCB. There will be more of everything – more games, better video and more services. The same will apply to the region’s religious content too.”
This process is already well underway in some of the more advanced MENA markets, including Saudi Arabia, Kuwait, Qatar and the UAE.
“I have been amazed already at how much content is already being sold and it will only get bigger and better. Now everyone needs to focus on the quality,” Bou Harb concludes.