Top Five Ways to Boost Telecom Revenues and Profits in UAE

by Buana Sari Digital Marketer

The United Arab Emirates (UAE) is known for its harmonious blend of tradition and innovation. This unique mix of old and new is a perfect reflection of the country's dynamic nature. In this exciting backdrop, the telecommunications industry is like the backbone of the UAE's digital world. With the UAE Telecom Market predicted to grow from USD 9.08 billion in 2023 to USD 10.60 billion by 2028, at a steady 3.15% annual rate, it's on a remarkable growth journey (Source : Mordor Intelligence).

This growth is driven by several key factors, including the widespread adoption of 5G technology and the anticipation of 6G, both of which promise to revolutionize digital connectivity. The UAE's 5G networks boast some of the world's fastest median download speeds and exceptionally high fixed broadband speeds.

The UAE's digital landscape is further shaped by the proliferation of mobile media, the increasing use of smart devices, data localization initiatives, and a growing reliance on mobile, fixed, and broadband services. This nationwide journey toward digital transformation is fueling the telecom industry's growth throughout the forecast period.

Notably, the ongoing rollout of 5G, coupled with a rapid rate of device turnover and consumer demand for faster connectivity, signifies a positive trajectory for Average Revenue Per User (ARPU). The introduction of new products, especially in collaboration with international enterprises, is expected to stimulate further growth and innovation, driving the UAE telecom market's expansion.

While competition thrives in this dynamic telecom market, with the presence of major players like Etisalat, du, Virgin Mobile UAE, Zawya Telecom, and Yahsat, the industry remains committed to innovation and enhancing services for consumers. However, this competitive environment poses challenges, including pricing pressures and the imperative to innovate continually to meet evolving consumer expectations.

To navigate this landscape, the UAE government plays a pivotal role, providing support through subsidies, investments in research and development, and regulatory initiatives that foster competition and innovation. At the heart of regulatory oversight is the Telecommunications Regulatory Authority (TRA), established in accordance with the UAE Telecoms Law. The TRA is the principal authority overseeing telecom operations, ensuring compliance, and promoting fair competition.

Additionally, the UAE has recognized the immense potential of artificial intelligence (AI) in shaping the telecom sector's future. In 2017, a dedicated ministry was established to oversee all matters related to AI. Furthermore, in July 2020, this ministry underwent a transformation, becoming the Artificial Intelligence, Digital Economy & Remote Working Application Office. This reimagining highlights the government's commitment to utilize breakthrough technologies in the telecom sector.

To propel the UAE telecom industry forward, the government extends invaluable support through subsidies. These subsidies are instrumental in expanding infrastructure, pioneering new technologies, and ensuring that even low-income consumers have access to affordable telecom services. Investment in research and development is a cornerstone of the government's strategy, channeling resources into groundbreaking areas like 5G, the Internet of Things (IoT), and artificial intelligence (AI).

In a bid to encourage innovation and enhance competition, the government has actively facilitated the entry of new telecom operators into the market. This strategic move not only fosters a more competitive landscape but also spurs innovation, ensuring that the UAE's telecom sector remains at the forefront of technological advancements.

In 2023, the UAE's telecom sector faces a series of formidable challenges. With three major players – Etisalat, du, and Virgin Mobile UAE – the market is intensely competitive, resulting in price pressures that can impede profit margins. Furthermore, the UAE boasts an already high mobile penetration rate, leaving limited room for acquiring new customers. To drive revenue growth, telecom companies must shift their focus towards enhancing Average Revenue Per User (ARPU) among their existing customer base. Adding to the complexity, Over-The-Top (OTT) services like WhatsApp and Netflix are gaining popularity in the UAE. Offering similar features at often lower prices, these services intensify competition, potentially leading to reduced ARPU for traditional telcos.

The UAE's telecom sector stands at the cusp of transformation, presenting both formidable challenges and unprecedented opportunities. This article explores the top five strategies that telecom operators can leverage to boost their revenues and profits in this highly competitive and rapidly evolving market.

1. Embrace Digital Transformation

In the UAE, where the government actively champions digital transformation, embracing this shift becomes a strategic necessity for telcos to flourish. The United Arab Emirates’ Telecommunication and Digital Government Regulatory Authority (TDRA) has declared transformation projects under "We the UAE 2031" vision. This comprises a national action plan via which the United Arab Emirates will continue its development journey and enter the first decade of the next fifty years. TDRA has three transformation projects with an important strategic impact like the Digital Vault within the banking, insurance and telecommunication sectors and Digital Customer Journey Quality Measurement Programme. These are likely to impact telcos favorably.

The Digital Vault project contributes to enabling the telecom sector to design and provide seamless digital services to customers in a way that enhances the quality of life in the UAE, on the grounds of ease, trust and privacy by using a digital vault that allows sharing reliable data and documents with the approval of the customers (Source : Zawya).

By harnessing the potential of technology, telecom companies in UAE are not only modernizing their services but also elevating customer experiences to unparalleled heights. Leading telcos in the UAE have already taken substantial steps in integrating transformative technologies that not only enhance user engagement but also stimulate robust revenue growth.

For instance, In 2023, Etisalat made substantial investments in digital transformation, introducing initiatives aimed at enhancing customer experiences. These include a new digital customer portal and a chatbot capable of addressing customer queries.

Likewise, du has also been actively investing in digital transformation, rolling out initiatives to elevate customer experiences. These efforts encompass a new self-service app and a virtual reality experience enabling customers to explore their network.

As the UAE's telecommunications industry leads the charge in digitization, innovative solutions tailored to the ever-changing needs of consumers have taken center stage. Among these groundbreaking transformations, the moLotus mobile video customer interaction platform shines as a prime example.

Operating seamlessly on GSM technology, this platform directly connects with mobile devices, irrespective of the specific model or the presence of applications or data plans. moLotus could equip UAE telcos to deliver captivating multimedia content, such as videos and personalized messages, engaging consumers at a completely new level. This transformative technology not only enhances customer interactions but also unlocks innovative revenue prospects for telcos.

One remarkable illustration of this is moLotus's ability to automate and revamp diverse customer processes, encompassing payment and service reminders, loyalty initiatives, contract renewals, and customer onboarding. By seamlessly fitting into telco operations, moLotus brings them into the new digital landscape. It exceeds customer expectations, improves both revenue and profits, and cuts operational expenses significantly.

2. Leverage Mobile Advertising Opportunities

The United Arab Emirates (UAE) boasts one of the most digitally connected populations in the world, with a high penetration of smartphones and mobile internet usage. This presents a significant opportunity for telecom operators to leverage mobile advertising as a powerful revenue-generating tool. According to Statista, the mobile advertising spend in the UAE is expected to reach USD 700 million in 2023. This represents a compound annual growth rate (CAGR) of 17.5% from 2020 to 2023.

The growth of mobile advertising in the UAE is providing a number of opportunities for telecom businesses. They can use mobile advertising to reach a wider audience, target their ads more effectively, and measure the results of their campaigns more accurately.

The UAE’s mobile advertising market is highly competitive, with new entrants continually emerging. To thrive in mobile advertising, telcos must select the right partners and solutions tailored to their needs. Google, a global leader in mobile advertising, maintains a strong presence in the UAE, providing diverse solutions like search, display, and app advertising. Facebook, another major player, offers various mobile advertising solutions, including in-app, social media, and native advertising. MoPub, a mobile advertising platform, enables businesses to reach their target customers across multiple mobile applications and websites. InMobi, another mobile advertising platform, offers various ad formats such as banners, videos, and interstitials. Applovin, specializing in mobile advertising, provides ad formats like rewarded videos and native ads.

The mobile advertising landscape in the UAE offers a golden opportunity for telecom operators to drive revenue growth through strategic collaborations with advertising platforms. In 2023, Etisalat forged a strategic alliance with Google aimed at delivering highly personalized and contextually relevant advertisements to Etisalat's customer base. Leveraging Google's advanced advertising technology, this partnership will enable precise ad targeting based on users' preferences and demographics.

Similarly, du and Applovin partnered this year to bring out an innovative mobile advertising platform. This platform will harness du's extensive data resources and Applovin's technology to offer du's customers more pertinent and captivating advertisements.

In yet another collaboration, Virgin Mobile UAE partnered with Tapjoy in 2023 to enhance the interactivity and engagement of ads for its customers. By utilizing Tapjoy's technology, this partnership will ensure the delivery of ads that are highly clickable and conducive to customer interaction.

The moLotus mobile advertising platform emerges as a game-changing tool for telecom marketing strategies. Through seamless integration, telecom operators in the UAE can now deliver personalized multimedia content directly to subscribers' mobile devices, transcending device models and mobile app availability. This innovation opens up exciting dimensions of customer interaction, offering telcos the potential not only to generate revenue through advertising but also to bolster customer loyalty and enhance brand perception.

moLotus revolutionizes how UAE telcos engage with their subscribers. By delivering tailor-made multimedia content directly to mobile handsets, regardless of device specifications, telcos can provide a unique and immersive experience. This approach goes beyond traditional advertising, forging deeper connections between telcos and their subscribers, thereby driving customer loyalty and elevating brand recognition.

3. Monetize Subscriber Data

In the United Arab Emirates (UAE), subscriber data has emerged as a vital asset for telecom operators, offering a strategic avenue to diversify revenue streams. By harnessing the valuable insights derived from subscriber behaviors and preferences, telcos are empowered to deliver precisely targeted ads, personalized services, and valuable insights to advertisers and businesses.

The total revenue from subscriber data monetization in the UAE is expected to reach USD 1 billion in 2023. In this landscape, key players such as Etisalat and du are at the forefront of subscriber data monetization initiatives, capitalizing on their substantial market share.

Cutting-edge platforms like moLotus are at the forefront of using telecom subscriber data to design hyper-personalized, engaging, and automated rich media ad campaigns. This data serves as a wellspring of valuable insights, enriching revenues and guiding strategic decisions. Streamlined for operational efficiency, moLotus drives mobile advertising and customer process enhancements, ultimately elevating Average Revenue Per User (ARPU) and refining strategic tactics. Crucially, this data remains anonymized and privacy-compliant while enabling precise campaign customization for target audiences, creating a mutually beneficial scenario for telcos and advertisers.

In the pursuit of data-driven growth, telcos in the UAE turn to powerful analytics tools such as Google Analytics. This tool empowers telecom businesses to meticulously track user actions and gather user data, providing profound insights into user behaviors and demographics. Armed with this data, telcos can offer advertisers access to specific audience groups for precisely targeted campaigns. This not only enhances the value proposition for advertisers but also results in increased revenue for telcos.

With Facebook Audience Insights, UAE telcos can extract actionable insights from user interactions with Facebook assets. This data facilitates the creation of detailed customer profiles, enabling telcos to segment their subscriber base effectively for data monetization purposes. Advertisers can then craft highly targeted campaigns that boost engagement and, consequently, revenue for telcos.

In the evolving landscape of UAE telecommunications, subscriber data monetization stands as a big opportunity. By leveraging these insights and innovative tools like moLotus, telcos can not only diversify their revenue streams but also enhance their competitive edge in a rapidly evolving market.

4. Enhance Customer Communication

Personalized communications have risen to paramount importance within the telecom sector. Telcos operating in the UAE are increasingly recognizing the significance of tailoring customer experiences to align with individual preferences and unique needs. Personalized campaigns have emerged as a powerful tool for engaging telco customers, as they resonate more profoundly with their specific interests.

Much like their global counterparts, telcos in the UAE have started embracing innovative approaches, such as moLotus mobile advertising campaigns, tailored to individual customers' names, addresses, and more. This approach ensures that communication is not only highly personalized but also exceptionally engaging, resulting in increased customer engagement and, consequently, improved revenue streams.

Mobile operators in the UAE are now leveraging customer data, Artificial Intelligence (AI), and advanced algorithms to craft precisely personalized ad campaigns through moLotus. These campaigns resonate deeply with individual preferences and interests, driving higher engagement rates and boosting revenue generation. By sending tailored suggestions and exclusive deals, telcos are capturing immediate attention and eliciting rapid responses from their customers.

This shift represents a significant departure from traditional reliance on emails and social media for customer engagement. Telcos in the UAE now possess advanced technology and platforms that enable highly interactive brand-customer interactions. In particular, moLotus has emerged as a transformative force, simplifying the process for telcos to captivate and engage their subscriber base effectively.

moLotus empowers telco marketers to craft engaging and profitable advertising campaigns featuring user-friendly response options such as URL Click, mgram, USSD, SMS, Call, and more. Additionally, this versatile tool enhances visual communication by offering a diverse range of rich media formats, including videos, brochures, greetings, slideshows, and showcases.

Telcos can seamlessly incorporate product images, voice-overs, music, and other creative elements to construct captivating storyboards and impactful mobile videos — all accomplished within a concise timeframe of up to 40 seconds. This not only streamlines the customer engagement process but also significantly enhances the overall customer experience, resulting in increased conversions and sales revenues.

5. Uplift Consumer Revenues

The telecom sector in the United Arab Emirates (UAE) shares common ground with its global counterparts as it seeks innovative strategies to elevate the average revenue per user (ARPU). This quest for enhanced consumer revenues is a significant challenge for UAE telcos. While some UAE telecom providers experienced growth in both customer numbers and revenues in 2022, sustaining this momentum in 2023 has proven to be a formidable task, especially with looming economic pressures.

The average revenue per user (ARPU) for mobile services in the UAE has been declining in recent years. In 2020, the ARPU for mobile services was USD 22.50. This declined to 20.50 in 2021 and is expected to decline further to USD 19.50 in 2023.

Several factors contribute to this decline. A prominent factor is the escalating use of over-the-top (OTT) services such as WhatsApp, Facebook Messenger, and Netflix. These services enable users to communicate and consume content without depleting their mobile data, thereby causing a dip in ARPU figures.

Furthermore, as the cost of living rises in the UAE, household budgets are under increased scrutiny, leading people to scale back their spending on telecom services, further adding to the ARPU challenge.

Industry experts advocate that UAE telcos can reverse this trend by adopting innovative marketing technologies like moLotus. By doing so, they can effectively engage customers, deliver enhanced value, and optimize every aspect of the customer journey, ultimately leading to a rapid increase in ARPU.

Extensive studies reveal that numerous Asian telecom brands have experienced substantial increases in consumer revenues, ranging from two to four percent, following the integration of moLotus into their operations. moLotus's innovative marketing capabilities enable telecoms to elevate customer responses, boost revenue streams, and enhance overall business performance, all while managing costs effectively. The technology facilitates cross-selling, upselling, and add-on campaigns, thereby augmenting customer lifetime value and ARPU.

Leaders in the UAE's telecom industry harbor optimism that the adoption of moLotus's advanced features will catalyze similar benefits, breathing new life into their businesses and facilitating a remarkable uplift in ARPU.

Conclusion

The future of the UAE's telecom industry holds immense promise. With a robust digital infrastructure, increasing 5G penetration, and a population eager to embrace technological advancements, the telecom sector is poised for sustained growth. However, challenges such as rising competition and the popularity of OTT services must be met with innovative solutions.

In closing, telecom operators in the UAE are encouraged to seize the opportunities presented by these strategies. By embracing digital transformation, leveraging mobile advertising, monetizing subscriber data, enhancing customer communication, and boosting consumer revenues, telcos can not only navigate challenges but also position themselves for high margin revenue growth. The potential for revenue enhancement is huge, and the time to start on this transformative journey is now.