Market concentration and competitiveness in the Moroccan telecommunications sector

Abstract This paper examines the impact of market liberalization on telecommunications adoption in Morocco. Using a quarterly dataset (2004–2023), we investigate how changes in market concentration influence penetration rates across the Voice calls and Access to Internet segments. Our empirical results reveal that while liberalization successfully drove penetration, the Voice calls segment responded rapidly to market competitiveness, whereas the Access to Internet segment exhibited a gradual adjustment. Furthermore, our analysis identifies a technological substitution effect, as the rise of 4G technology has begun to displace traditional voice services in favor of data centric usage. We also find that the increase in local loop access tariffs failed to encourage the transition toward advanced technologies, thereby reinforcing the incumbent operator’s strategic dominance over the fixed infrastructure. We conclude that market penetration is increasingly driven by mobile connectivity rather than firm ownership structure. Our findings suggest that for developing nations, liberalization should prioritize the privatization of incumbents and the strategic deployment of mobile technologies to ensure inclusive growth.