2008 Eastern European Mobile Communications and Mobile Data (tables only)

A past favourite growth opportunity, Eastern Europe's mobile markets have now largely reached maturity or saturation given current mobile penetration levels. Healthy competition is evident with most countries served by three or four mobile network operators and mobile number portability making it easy for consumers to switch service providers. Growth opportunities through new subscriber additions are fading in the mature markets with operators instead aiming to grow revenue through raising ARPU levels. This has led to initiatives such as market segmented-oriented offerings and encouraging prepaid users, which account for the majority of mobile users in Eastern Europe, to take up postpaid service contracts.

Any ARPU gains may be short lived in EU markets given the ongoing regulatory mandated reductions in mobile termination rates, designed to avoid distortions of competition. However a new growth opportunity has arisen in mobile broadband. Past investments in 3G/HSDPA networks are beginning to pay off as mobile broadband subscriptions take off, with mobile broadband access services available for computers and handsets. Tariff competition and increasingly affordable multimedia handsets will see mobile broadband subscriptions grow strongly during 2009. A challenge that will become increasing prevalent for mobile operators will be ensuring that networks previously designed predominantly for voice traffic possess sufficient backhaul capacity to cope with the sheer amount of traffic associated with offering mobile broadband services.

Data in this report is the latest available at the time of preparation and may not be for the current year.

The following notes provide some background to our scenario forecasting methodology:

·         This report includes what we term scenario forecasts. By describing long-range scenarios we identify a band within which we expect market growth to occur. The associated text describes what we see as the most likely growth trend within this band.

·         The projections shown in the tables in this report are based on our own historical information, as well as on telecommunication sector statistics from official and non-official, national and international sources. We assume a possible deviation of 15-20% around this data.

·         All statistics for GDP, revenue, etc are shown in US$, in order to maintain consistency within and between markets. At the same time we acknowledge that this can introduce some irregularities.