Overview

Mobile penetration of 36 million subscribers or roughly 90 percent, remains low compared to other oil-endowed states in the region but is expected to increase over the coming years as mobile firms finish building out nationwide networks and household incomes increase.  Internet penetration, not including mobile phone use, is about 20 million, or 50 percent.

Mobile operators currently utilize Erikson and Huawei technologies to provide 4G LTE services, which was launched in Jan 2021.  The first phase of 4G service is covering many highly populated areas in the country.  Meanwhile the operators continue to use slow 2G EDGE and GPRS technologies for data service in remote areas.  All three of the mobile operators have benefited from significant foreign investments (Zain Kuwait with Zain Iraq, Q Tel with Asiacell, and most recently France Telecom and Agility with Korek) that will likely increase once the firms list 25 percent of their shares on the Iraqi Stock Exchange as mandated by their licenses.

Iraq’s three national and one regional wireless firm have built CDMA networks in most of Iraq’s major cities, providing wireless Internet and voice access to consumers and businesses.  A number of operators in the IKR run CDMA and WiMAX networks but do not have frequency licenses from the national independent regulator.

The number of internet users, not including though mobile phone, in Iraq is estimated to be about 20 million. Total internet traffic that enters Iraq through the current infrastructure is 111 lambda (1lambda= 10Gb).  Iraq’s current bandwidth needs are estimated to be between 300-400 lambda.  Iraq’s minimum future needs to run 4G services efficiently is estimated to be 500 lambda.  Most Iraqis access the internet wirelessly, either in cafes or through neighborhood providers, but bandwidth remains small since the cost of providing the service is high.  The Ministry of Communications (MOC) owns Internet infrastructure in the country and is leasing this infrastructure to private Internet service providers.  The ministry is selling 1Mbps to ISPs for about $50. Businesses or those with higher incomes can subscribe to WLL, ADSL, and other high-speed solutions.

Opportunities

The MOC’s fixed-line telephone infrastructure remains dilapidated.  It has implemented a number of fiber to the home (FTTH) projects in certain neighborhoods in Baghdad.  The number of subscribers is estimated to be 2.1 million including the users of fixed-line telephone and FTTH’s telephone services.

Private investment and competition in fiber is extremely limited due to the MOC’s exclusive authority over fiber, making prices the highest in the region.  The MOC’s two state companies, however, have contracted several private Iraqi firms to rebuild and expand the fiber backbone.  Iraq has terrestrial connections with each of its six neighbors and to the Gulf Bridge International submarine cable.  U.S. firms could participate in building-out Iraq’s fiber optic sector through equipment supply, development and design of electronic components, network architectures and system monitoring programs, and operating centers.  U.S. engineering and system design firms could take advantage of Iraq’s need for the deployment and implementation of IP-based communications applications.  Iraq has implemented or is rolling out e-government, e-health, e-education, and e-banking networks.