2010 Turkey - Telecoms, Mobile, Broadband and Forecasts

Turkey’s telecommunications market was hard-hit by the Global Financial Crisis but the launch of 3G mobile services in mid-2009 and healthy growth in the broadband sector are more positive aspects.

Both fixed-line and mobile subscriber numbers fell during 2009. Fixed-line subscriber numbers have been falling for some years due to mobile substitution with penetration rates falling from 28% in 2004 to 23% in 2010.

Economic growth is forecast to return to healthy positive levels during 2010 and mobile subscriber numbers are also expected to resume growth. The market is very competitive, with both Turk Telekom subsidiary Avea and Vodafone Turkey gradually chipping at Turkcell’s dominant market position. All three operators have substantial foreign ownership share.

3G licences were awarded in 2008 and the three mobile operators launched services in mid-2009. Turkcell claimed five million 3G subscribers in February 2010 and estimated there were around two million active 3G users in Turkey at end-2009.

The telecoms market has been mostly liberalised with a number of alternative fixed-line operators, and a majority stake in incumbent fixed-line operator Turk Telekom privatised. The telecoms regulatory framework has been amended to conform to the EU’s regulatory framework for communications.

With a falling fixed-line voice market, Turk Telekom is concentrating its energies on the broadband Internet market, with some success. Turk Telekom dominates the wholesale broadband market due to the reach of its network. In addition, the retail share of its subsidiary TTnet is around 90%. It will need to work hard to retain its market dominance however, as mobile operator Turkcell is investing in considerable fibre infrastructure through its subsidiary Superonline. Vodafone Turkey also bought a major alternative operator in late 2009.

These factors have led to very healthy growth rates in broadband subscribers. Almost all Internet subscribers are now broadband subscribers.

Market highlights

• 3G mobile services were launched in mid-2009, with Turkcell claiming five million subscribers by mid-2010.
• Incumbent Turk Telekom is pinning its hopes on broadband as competition and mobile services eat into its fixed-line revenue. Broadband penetration rates remain low compared with average EU levels but growth rates are good.
• Mobile operators Vodafone Turkey and Turkcell have both made moves to challenge Turk Telekom in the broadband sector, with Turkcell investing in considerable fibre infrastructure.
• Turkey has a very healthy broadcasting sector, with terrestrial, cable and satellite channels, including substantial pay-TV. The analogue-digital switch-over is on track for 2014.

Estimated market penetration rates in Turkey’s telecoms sector – end 2010

(Source: BuddeComm based on industry data)

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