Turkish ISP Subscribers Boom in 2000

According to research by IBS, there was 609 percent growth in Internet subscribers in Turkey in 2000, creating a penetration rate of 5.5 percent. The expansion demonstrates that low Turkish consumer spending power (one-sixth of the EU average) is not proving as much of a drag to user growth as some had feared.

IBS found the boom in usage has been made possible, in part, by creative and costly marketing, including the bundling of PCs with ISP subscriptions, and in part by a young, technology-hungry Turkish population. But to what extent Internet companies, including the ISPs who have largely funded the growth, will be able to translate subscriber boom into profits, is as uncertain in Turkey as elsewhere.

According to IBS’s Turkish Internet Sector Report, subscriptions claimed by Turkish ISPs grew from 322,000 at the end of 1999 to 2.3 million at year-end 2000. This followed a 280 percent increase in 1999. IBS’s end-user research shows that each subscriber has an average of 1.5 ISP subscriptions. Thus, the number of individual Internet subscribers in Turkey is approximately 1.5 million. The research further shows a subscriber-user ratio of 2.4:1, meaning that Turkey has around 3.7 million residential users.

IBS’s report, which also surveys trends in e-commerce, e-financial services, venture capital, infrastructure, and regulation and technologies. The report argues that B2C and advertising revenues remain low in Turkey, with the latter worth an estimated $7 to 9 million in 2000. Interviewed in October of 2000, three-quarters of Turkish users interviewed by IBS were aware of e-commerce. But only 4.1 percent of these had actually shopped online, leading to a Turkish e-commerce market of around $13 million in 2000.