Increasing Broadband Internet Penetration
In the OIC Member Countries
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V.3. KAZAKHSTANThe following case study assesses the state of broadband services in Kazakhstan. It reviews the
trends in demand and supply, the broadband industry structure, and the state of investment
and broadband technology infrastructure.
In order to understand the state of demand and supply of broadband services in Kazakhstan it
is first necessary to take a look at the country’s demographic structure since it provides a
perspective of the challenges faced by the government to increase broadband adoption. As of 1
January 2016, the population of Kazakhstan was estimated to be 17,769,475 people81. The
country’s total population density is fairly low: 6.5 people per square kilometer82. Fifty-five
percent of the population lives in cities, which means that, beyond the urban centers,
population density of rural areas approximates 2.9 people per square kilometer. This rural-
urban dichotomy is at the root of both the country’s technological progress in urban areas and
the challenges remaining to bridge the rural divide.
In the aggregate, Kazakhstan is highly advanced in terms of broadband network deployment
and usage when compared to other OIC Member Countries. Since 2006, the number of Internet
users in Kazakhstan has increased from 8.3% to 73%83 , thanks largely to the development of a
modern telecommunications infrastructure. This has also helped raise Kazakhstan’s ranking in
the 2014 UN E-Government Survey to 28th position. Smartphone penetration (41% of
population)84 and fixed broadband (50% of households) remain among the highest in Central
Asia. From an infrastructure standpoint, the industry is actively migrating mobile broadband
subscribers to 4G LTE networks, and deploying fiber optics in the distribution networks. In the
2014-15 Global Competitiveness Report of the World Economic Forum, Kazakhstan ranks in
62nd place for number of Internet users and 58th for users of broadband Internet, out of a total
of 144 countries.
On the other hand, in part due to the challenges encountered to serve the rural low population
density areas, a demand gap related to the urban/rural divide exists. The urban centers
comprise a set of fixed and mobile broadband competitors deploying highly advanced
technology with high broadband adoption, while the rural areas remain somewhat
underserved or relying on underperforming technology in a context of highly concentrated
industry structure. This situation is driven both by challenging deployment economics and
lower purchasing capacity of rural population.
In this context, the government is pushing to address the digital divide challenge, while
attempting to further diversify the country’s economy, beyond the oil and gas sector. Along
these lines, Kazakhstan aspires to become one of the thirty most competitive countries in the
world through an ambitious digitization program. “Digital Kazakhstan 2020” aims to help
boost the economy through accelerated digitization. Creating a digital platform to increase
81 Source: United Nations Department of Economic and Social Affairs: Population Division.
82 The total area of Kazakhstan is 2 724 900 km2 according to the United Nations Statistics Division.
83 Source: International Telecommunications Union, 4Q2015.
84 Source: GSMA Intelligence, 4Q2016.