At present, the state-owned Djibouti Telecom (DT) is the sole operator in the domestic market and directs the development of the sector. Djibouti Telecom’s entire revenue derives from three specific products, namely, fixed lines, mobile services and fixed broadband, which grew by 11% from 2012 to 2013.

The competition is still required to meet the demands of the market. Due to the lack of competition, a number of issues have arisen, including high prices and low penetration rates in every area of the sector. Therefore, unaffordability has become an issue in the country. Based on an analysis by the World Bank, at least 40% of the total population would have to spend nearly their entire income in order to benefit from fixed broadband services, and even mobile broadband is still difficult to afford. Djibouti’s progress in the ICT sector is weak and below the world average, according to the United Nations’ 2014 e-government survey, placing the country among the lowest 10 in Africa. Based on EGDI statistics, Djibouti improved by eight positions in 2014 but still ranked 184th worldwide due to an absence or insufficiency of e-services. Furthermore, the disparity between rural locations and Djibouti City is a significant factor in the country receiving such a low rank. Almost 27% of the total population still lives in rural areas and cannot benefit from certain ICT products.

The contribution of the ICT sector to the country’s GDP has increased, amounting to nearly 3.9% of total GDP

Total mobile phone subscriptions are still low but have grown rapidly since 2006, seeing an increase of 14.9%. The mobile penetration rate was at 5.6% in 2006, 19.8% in 2010, and 27.9% in 2013. Nevertheless, the World Bank’s 2014 report on Broadband Networks in the MENA region described Djibouti, along with Yemen, as having one of the lowest mobile penetration rates compared to other MENA countries due to coverage being provided by a monopolistic sector. The report also indicates that mobile broadband prices are extremely high in Djibouti and resulted in a very low penetration rate of only 2.22% among the entire population and is used by only 9.29% of mobile phone users. Djibouti Telecom has been the only provider of mobile broadband in the market, as with other telecom and internet services, since the company officially launched 3G technology in 2011.

The number of internet users increased by 38.5% on average over the last five years. Facebook is popular among internet users and 81.8% of them already have an account, with an estimated total of 62,980 users, which grew by 25.6% in 2013.

The Statistics Office of Djibouti (DISED) releases an annual statistical report on telecommunications subscriptions, showing that fixed line penetration had grown by a very small amount, 3.6%, at the end of 2013, reached 2.36% up from 2.30%. DISED also reported a total of 20,686 fixed line telephones in 2013. Although the fixed broadband market has not been sufficiently developed compared to the African average and had a penetration rate of only 2.1%, it has had extreme growth rates since 2006. It rose by 18.7% last year, up from 14,907 subscriptions, experiencing major advances both in 2008 and 2009, by 124.4% and 115.6%, respectively. The total number of internet users in Djibouti reached 9.5% in 2013, overtaking its neighbors such as Ethiopia by 1.9% and Somalia by 1.5%. The number of internet users increased by 38.5% on average over the last five years. Facebook is popular among internet users and 81.8% of them already have an account, with an estimated total of 62,980 users, which grew by 25.6% in 2013.

Prices are still excessively high which results in a large portion of the population not being able afford to pay for the internet access offered by Djibouti Telecom. Indeed, with the monthly fee applied by the operator for ADSL 1MB being about $84 for domestic users and US$ 236 for business users, this means fees for broadband services are equivalent to 45% of GDP per capita.

Data 2011 2012 2013 Change
Mobile Phone Subscription 22.8% 24.7% 27.9% 14.9%
Fixed Phone Subscription 2.1% 2.3% 2.3% 3.6%
Fixed Broadband Subscription 1.3% 1.7% 2% 18.7%
Internet Penetration 7% 8.2% 9.5% 21.4%

*DISED; ITU

The broadband market in Djibouti is small. However, the country also serves as a transit hub. Because of its geographical location in the Horn of Africa, it has become the meeting point of international network systems, which offers the country an opportunity to accelerate its broadband performance and reduce internet costs. For instance, East African countries benefit from being connected to fiber optic cable systems passing by Djibouti from Europe toward Africa and Asia. At present, Ethiopia and Somalia are linked by two sub-regional cables, allowing them to connect international networks and one to South Sudan is being planned.

However, more is still required despite the undersea cables. The current monopolistic system needs to be reformed into a competitive sector in the short term. The promotion of a competitive market in Djibouti would encourage foreign companies to invest in telecommunications, reduce the high prices, and increase the affordability and penetration rates of every segment of the sector.

Mobile Phone Subscription 2009 2010 2011 2012 2013
Penetration 128,776 165,613 193,040 212,468 244,123
Rate (%) 15.6 19.8 22.8 24.7 27.9
Change (%) 14.1 28.6 16.5 10.0 14.9

*Djibouti Telecom

Fixed Phone Subscription 2009 2010 2011 2012 2013
Penetration 16,842 18,474 18,442 19,955 20,686
Rate (%) 2 2.2 2.1 2.321 2.369
Change (%) 12.9 9.6 -0.1 8.2 3.6

*DISED

Internet Subscription
(Fixed Wired Broadband – ADSL)
2009 2010 2011 2012 2013
Penetration 5,285 8,058 11,302 14,907 17,705
Rate (%) 0.6 0.9 1.3 1.7 2.0
Change (%) 115.6 52.4 40.2 31.9 3.6

*DISED