Overview
| Overview | 2007 | 2008 | 2009(estimated) |
|---|---|---|---|
| Total Market Size | 569.7 | 654 | 718 |
| Total Local production | 12 | 14 | 15 |
| Total Exports | 7.3 | 10.1 | 12 |
| Total Imports | 565 | 650 | 715 |
| Imports from the U.S. | 105 | 135 | 150.2 |
In USD Millions; Note: the above statistics are unofficial estimate based on Kazakhstan customs data and industry sources.
Based on industry experts’ estimations, the volume of the telecommunications market was approximately $2.6 billion in 2008. Communication services provided in 2008 by local providers was valued at $1.3 billion, with a growth of 26% compared with in 2007.
Kazakhstan spent approximately $650 million on imports of telecommunications equipment in 2008, an increase of 21% from the previous year. As there is almost no domestic production of telecom equipment (except coaxial and fiber-optic cables, and small PBXs), the volume of domestic production is a fraction of market demand. As a result, imports represent 98% of the telecommunications equipment market, with the U.S. commanding a 21% share.
The telecom market is still hampered by a lack of competition, and the majority state-owned Kazakhtelecom and its subsidiaries constitute a de facto monopoly, controlling most of the country’s $1.6 billion telecom industry. As in other developing countries, the cellular segment represents the largest portion of the market (51%), followed by fixed line (25%) and Internet (8%). Accession to the WTO should positively impact this sector, allowing for more foreign investment and reduced rates for users (currently, costs of telecommunication services in Kazakhstan exceed those of the U.S. and Western and Eastern Europe). WTO membership would also allow for growth in this sector, as telephone density is at 20%, and Internet access is at approximately 9-10%.
Best Products and Services
There is a growing demand for telecom equipment and services for mobile, fixed line telephony, cable, broadband, mobile (value-added) data services, digitization of the existing telecommunication networks including digital and/or interactive TV systems working on a frequency of 40 GHz and more, and all types of Internet-related communication services including Wi-Max and Wi-Fi technologies and equipment, VSAT terminals, DWDM technologies and DECT technologies.
Opportunities
- In 2006, Kazakhstan launched the Alatau IT City, an informational technologies park in Almaty. The IT Park offers a number of projects aimed to improve and develop the IT industry in Kazakhstan and can provide tax and other benefits to firms interested in investing into this sector.
- Kazakhtelecom’s New Generation Network Project, to build a new broadband infrastructure based on the IP/MPLS and Metro Ethernet technology.
- In 2006 Kazakhstan launched its own communications satellite. The government of Kazakhstan allocated approximately $340 million for the development of Kazakhstan’s space program, and plans to launch four more telecommunication satellites by 2010.
- A number of e-Government Projects are being implemented in Kazakhstan.
- In 2006 the government approved a program to reduce the country’s “informational inequality” by creating a training center for information technology specialists and a Kazakhstani university for informational technologies, which will be developed by cooperating with leading educational and training organizations.