Executive summary
Investment in mobile networks compensates falls in other sectors
Malta’s small telecom sector has been stimulated by a number of regulatory measures designed to increase competition and reduce consumer prices. These have affected the voice termination market, interconnection pricing and local loop unbundling, and provided for a number of MVNOs to operate in the mobile sector.
Although local loop unbundling has been legislated for since 2003, there has been very little take-up, with the result that most ISPs resell broadband offers from the incumbent, GO. A number of ISPs failed during 2009 and 2010, and since GO picked up most of these it has been able to increase its market share. Indeed, the number of alternative broadband players is falling rapidly and by 2010 they had only an insignificant market share. The sector is thus dominated by GO and Melita Cable, providing effective cross-platform competition, though Vodafone also offers an island-wide WiMAX service. Broadband penetration remains comparatively low by European standards, and broadband speeds are relatively slow: by the beginning of 2010 about 72% of subscribers had a connection of between 4Mb/s and 6Mb/s, while only 9.6% had a connection of at least 10Mb/s.
The value of Malta’s telecom market fell 6.4% in 2009 and by an estimated 3.5% in 2010. The sector’s decline is in line with all other telecom markets in Europe and follows the global context of the economic downturn. Revenue is expected to recover somewhat in 2012 as economic conditions improve and the number of tourists (on which Malta’s economy is widely dependent) increase. Investment in telecoms networks was maintained into 2010, though this was mainly made up of investment from mobile operators which compensated for lower investment by other operators providing fixed-line services, which fell by more than 50% year-on-year.
In the mobile market Vodafone Malta, and GO Mobile and Melita Mobile have been joined by a few MVNOs which are gradually extending market share, though the sector remains dominated by GO Mobile and Vodafone. These operators offer quad-play services including mobile combinations of voice, cable TV, IPTV and telephony, which as bundles make it hard for other operators to gain a foothold other than within narrow markets. Nevertheless, a sympathetic regulatory regime is having a marked effect on operator behaviour as they struggle to retain existing customers in an increasingly competitive market.
The key issue for 2011 and 2012 will be the continuing effort by the regulator to encourage an NGN through developing regulations attractive as investment opportunities, and so maintain momentum in one of Europe’s smallest markets.
Malta – Key telecom parameters – 2010; 2012 (e)
Fixed-line
| 2010
| 2012
|
|---|
Subscribers (thousand)
| 247
| 248
|
Fixed-line penetration (population)
| 57%
| 58%
|
Internet service
|
|---|
Subscribers (thousand)
| 119
| 137
|
Broadband penetration (population)
| 30%
| 31%
|
Mobile service
|
|---|
Subscribers (thousand)
| 455
| 110%
|
Mobile penetration (population)
| 515
| 126%
|
(Source: BuddeComm)
Market highlights:
- Malta’s telecom sector revenue fell by an estimated 3.5% in 2010 as the general economic, continuing a trend first seen in 2008 more than 6% in 2009 having shown 7% growth in 2008. The country’s economic demise has not been as severe as in other areas of the EU, which has helped the three main telcos weather a difficult period with reduced revenue. Although Malta’s market is restricted by the country’s small population it benefits from having most inhabitants concentrated in a few towns, and so telcos can provide services to the majority with relatively little expense.
- By the end of 2011 the larger part of mobile networks will have been upgraded with HSPA technology, allowing them to promote mobile data services. LTE networks have not yet been considered viable Vodafone and GO Mobile, but current investments are being undertaken with a view to enabling the technology in future.
- Operators have focussed much effort into developing convergent services, with Melita and GO and Vodafone all competing with quad-play. Quad play far outnumbers other bundled offers, in contrast to most other markets where dual play prevails as the most popular combination.
- The government in early 2012 called for a national FttH network to be built, with a minimum broadband service being upgraded from 4Mb/s to 100Mb/s.
Henry Lancaster
February 2012
Data in this report is the latest available at the time of preparation and may not be for the current year.
This report provides a comprehensive overview of trends and developments in Malta’s telecommunications market. The report analyses the mobile, internet, broadband, digital TV and digital media sectors. Subjects include:
- Market and industry analyses, trends and developments;
- Facts, figures and statistics;
- Industry and regulatory issues;
- Infrastructure;
- Major players, revenues, subscribers, ARPU, MoU;
- Internet, VoIP, IPTV;
- Mobile voice and data markets;
- Broadband (FttH, DSL, cable TV, wireless);
- Convergence and digital media;
- 3G subscriber and mobile ARPU forecasts to 2015;
- Broadband market forecasts for selective years to 2020.
Key developments:
Mobile network operators invest for future 4G deployment; falling revenue set to stabilize to 2012; investment confidence emerging post- economic downturn; Malta’s first VoD service launched by Melita; regulator market data for 2010, operator data to June 2011.
Companies covered in this report include:
Vodafone, GO, Melita, SKYNet; Redtouchphone, PING.
This report is essential reading for those needing high level strategic information and objective analysis on the telecom sector in Malta. It provides further information on:
- Market liberalisation and regulatory issues;
- The impact of the global economic crisis;
- Telecoms operators – privatisation, acquisitions, new licences;
- Mobile data market developments in coming years in light of spectrum auctions and new license awards in 2010;
- 3G developments, regulatory issues and technologies including HSPA and LTE;
- Broadband migration to an FttH architecture;
- Historical and current subscriber statistics and forecasts;
- ARPU statistics and forecasts.
