Poland - Telecoms, IP Networks, Digital Media and Forecasts

Publication Overview

This report provides a comprehensive overview of trends and developments in the Polish telecommunications market. The report analyses the mobile, Internet, broadband, digital TV and converging 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:

Liberty Global consolidates cableco leadership with Aster City purchase; UPC plans 250Mb/s cable trial, extends 150Mb/s service to 1.6 million households; Telekomunikacja Polska losing broadband subscribers yet expands new VDSL Neostrada Fiber offer; EC fines TP €127.6 million for anti-competitive practices in the broadband market; Netia and TP head fibre-based consortia to extend broadband nationally; memorandum signed for constructing a national broadband infrastructure; large drop in average cost of mobile broadband plans; cablecos step up network investment in 2012; ASO confirmed for mid-2013; bundled services taken by 2.1 million customers; 75% of cable association PIKE subscribers can receive digital TV; Telekomunikacja Polska sells EmiTel for PLN1.7 billion; National Broadcasting Council awards licences for the final four channels on the first multiplex; Cyfra+ merges with digital TV platform ITI Neovision; incumbent predicts phase-out of single-play fixed-line telephony by 2015; Polkomtel sold for €4.56 billion; SMS use grows 7% in 2010; T-Mobile and Orange Poland network sharing joint venture, NetWorkS!, approved by the Office of Competition and Consumer Protection; regulator announces 2012 tender for LTE in the 2.50-2.57GHz and 2.62-2.69GHz bands; Cyfrowy Polsat launches LTE offer; Orange expands mobile wallet offering to Poland; regulator signs 800MHz usage agreement with Ukraine; Cyfrowy Polsat buys the mobile TV platform operator Info TV-FM; regulator prepares for 1800MHz auction; Visa Europe trials m-payment system for iPhone users; Polkomtel launches LTE with 22% population coverage; regulator eases cuts in MTR in exchange for network investment; regulator’s market data to end-2010, operator data to end-2011; market developments into 2012.

Companies covered in this report include:

Telekomunikacja Polska, Netia, Telefonia Dialog, GTS Energis, Exatel, Telekomunikacja Kolejowa, PTK Centertel, Polkomtel, T-Mobile, P4/Play, Centernet, Mobyland, UPC Polska, Vectra, Multimedia Polska, Aster, Cyfra+, Cyfrowy Polsat, N/TNK, TVP.

Researcher:- Henry Lancaster
Current publication date:- March 2012 (10th Edition)

Executive Summary

Mobile TV secures interest from broadcaster Cyfrowy Polsat

BuddeComm’s quarterly publication, Poland - Telecoms, IP Networks, Digital Media and Forecasts, provides a comprehensive overview of the trends and developments in the telecommunications and digital media markets in one of Eastern Europe’s largest and most competitive markets. It includes data from the regulator’s 2010 annual report, operator data to the end of 2011 and market developments into 2012.

As one of the ten countries which joined the European Union (EU) in mid-2004, Poland was obliged to reform its telecoms market and align its policies with those of the EU. Competition was introduced but the incumbent operator Telekomunikacja Polska (TP) has retained a major share of the overall market, and dominates most sectors. The fixed-line market has contracted due to competition and the trend of fixed-mobile substitution: market revenue has fallen for the last few years in line with the decline in the number of lines.

In common with many of its neighbours, Poland has been affected by the recent global financial turmoil. This slowdown has been reflected in the overall telecoms market, which has shown only a slight increase since 2009. This trend is likely to continue to 2013, largely on the back of the mobile and broadband sectors which will in part compensate for falling fixed-line voice telephony revenue.

The country has a well developed mobile market with high mobile penetration partly attributed to multiple SIM card ownership. There is effective competition from the MNOs and a significant number of MVNOs. A key recent development has been the network sharing deal between T-Mobile and Orange: their joint venture, ‘NetWorkS!’, will allow for faster infrastructure development and is expected to deliver to both companies substantial cost savings over the next five years. The move follows similar sharing agreements by the two companies in Austria and elsewhere in Europe, and in part results from their flagship enterprise Everything Everywhere in the UK.

Poland’s broadband market has developed rapidly in recent years as a result of falling tariffs and large scale take up of services. Growth in largely the result of the phenomenal increase in the number of mobile broadband subscribers, which now makes up the majority of accesses. Overall growth is expected to be steady in 2012, with the majority of subscribers being on mobile broadband plans. The FttX sector will also show significant growth in a number of cities, which should reduce the number of DSL customers as these are migrated to fibre networks.

DSL remains the most commonly available fixed-line platform. The incumbent’s market share has steadily fallen as the improving regulatory environment in relation to network access has given competitors alternatives through bitstream access and LLU.

Cablecos are continuing to invest in technology upgrades in a bid to retain customers in the face of competition from the fibre sector: by early 2012 UPC Polska had extended its 150Mb/s service to over 1.6 million households following upgrades in Lublin, Kraków, Katowice, Gdansk and Warsaw.

Another significant development for telcos in recent years has been the theft of equipment and cables. In late 2011 the regulator proposed that joint initiatives should be undertaken to tackle the problem, including legislation targeted at thieves as well, improved cooperation with local police forces and amended regulation dealing with the trade in copper and scrap metal.

Key telecom parameters – 2010; 2012

(Source: BuddeComm)

Market Highlights

• ASO has been confirmed for mid-2013, though satellite and digital cable TV remain the most common form of receiving TV.
• The regulator’s recent agreement with Ukraine concerning the use of frequencies in the 790-862MHz band in border areas will help the development of 4G services in Poland for mobile services. The agreement follows similar ones already undertaken with Russia and Belarus.
• The National Broadcasting Council has awarded licences for the final four channels on the first multiplex. All four broadcasters are new entrants to the market, and have established that they would not require investors or funding after receiving their licenses. The move is a major step in the progression to ASO.
• LTE, kick-started in late 2010, can potentially be developed in a number of bands licensed thus far. CenterNet and Mobyland have migrated base stations to LTE using the 1800MHz band, and aim to provide 60% geographic and 75% population coverage. Refarmed existing G spectrum can avoid the costs associated with new spectrum acquisitions, and so cost effectively extend mobile broadband to rural areas in coming years. Polkomtel commercially launched LTE at the end of 2011, providing 22% population coverage in 16 cities.
• FttX deployments remain low key though the government’s broadband policy has provisioned for network infrastructure access to promote fibre deployments.
• UPC and other cablecos have upgraded their networks to the DOCSIS 3.0 standard, providing up to 150Mb/s. Multimedia Polska, Aster City and Vectra also offer DOCSIS 3.0-based services. The higher data rate should help forestall customer churn to FttX networks as they are built out in coming years.
• Further market consolidation is expected in the cable TV sector as the major operators buy out regional players, and so realise greater scale to help upgrade networks and so fend of churn to fibre networks in coming years.
• The mobile TV licensee Info TV-FM was bought by the broadcaster Cyfrowy Polsat in late 2011. Cyfrowy Polsat has since partnered with Polkomtel to launch a mobile TV service in the first quarter of 2012; it also signed a cooperation agreement with Irdeto for the latter to provide conditional access and technical support while Cyfrowy Polsat will develop the market for devices for mobile TV reception.

This report is essential reading for those needing high level strategic information and objective analysis on the telecom sector in Poland. 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 2012;
• 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.

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

Table of Contents

• 1. Key Statistics
• 2. Telecommunications Market
  • 2.1 Overview of Poland’s telecom market
• 3. Regulatory Environment
  • 3.1 History
    • 3.1.1 Telecommunications Act (2001)
    • 3.1.2 Telecommunications Act (2004)
    • 3.1.3 EU Regulatory Framework
    • 3.1.4 Revised NFR
  • 3.2 Regulatory authority
    • 3.2.1 Office of Electronic Communications (UKE)
  • 3.3 Telecom sector liberalisation in Poland
    • 3.3.1 Local
    • 3.3.2 Long distance
    • 3.3.3 International
  • 3.4 Privatisation
  • 3.5 Interconnection
  • 3.6 Carrier selection and carrier preselection
  • 3.7 Access
  • 3.8 Functional separation
  • 3.9 Number Portability (NP)
• 4. Fixed Network Operators
  • 4.1 Market overview
  • 4.2 Telekomunikacja Polska (TP)
  • 4.3 Netia
  • 4.4 Telefonia Dialog
  • 4.5 Telekomunikacja Kolejowa
  • 4.6 GTS Energis
  • 4.7 Exatel
• 5. Telecommunications Infrastructure
  • 5.1 Fixed-line statistics
  • 5.2 TP
  • 5.3 Alternative operators
  • 5.4 Wholesaling
    • 5.4.1 Overview
• 6. Broadband Market
  • 6.1 Fixed broadband market
    • 6.1.1 Overview
    • 6.1.2 Government and EU support
    • 6.1.3 Poland’s emerging internet society
    • 6.1.4 Fixed broadband statistics
    • 6.1.5 Cable broadband
    • 6.1.6 Asymmetrical Digital Subscriber Line (ADSL)
    • 6.1.7 Fibre-to-the-Home (FttH) networks
    • 6.1.8 Wireless broadband
    • 6.1.9 Mobile broadband
• 7. Digital Media
  • 7.1 Overview of Digital Media market
    • 7.1.1 Business models
    • 7.1.2 Digital TV (DTV)
• 8. Mobile Communications
  • 8.1 Overview of Poland’s mobile market
    • 8.1.1 Mobile statistics
  • 8.2 Regulatory issues
    • 8.2.1 GSM licences
    • 8.2.2 Third Generation licences awarded
    • 8.2.3 Fourth GSM licence/fourth 3G licence auction
    • 8.2.4 800MHz spectrum
    • 8.2.5 2.6GHz
    • 8.2.6 1800MHz spectrum
    • 8.2.7 Mobile Number Portability (MNP)
    • 8.2.8 Mobile termination rates (MTRs)
    • 8.2.9 Roaming
    • 8.2.10 Network sharing
  • 8.3 Mobile technologies
    • 8.3.1 Digital
    • 8.3.2 Third Generation mobile
    • 8.3.3 Fourth Generation mobile
  • 8.4 Major mobile operators
    • 8.4.1 PTK Centertel/Orange
    • 8.4.2 Polkomtel/Plus GSM
    • 8.4.3 T-Mobile
    • 8.4.4 Centernet
    • 8.4.5 Mobyland
    • 8.4.6 Mobile Virtual Network Operators (MVNOs)
  • 8.5 Mobile voice services
    • 8.5.1 Prepaid cards
  • 8.6 Mobile Messaging
    • 8.6.1 Short Message Service (SMS)
    • 8.6.2 Mobile data services
    • 8.6.3 Mobile content and applications
• 9. Forecasts
  • 9.1 Forecasts – fixed broadband subscribers – 2010 - 2013; 2020
    • 9.1.1 Scenario 1 – higher broadband subscriber growth
    • 9.1.2 Scenario 2 – lower broadband subscriber growth
    • 9.1.3 Notes on scenario forecasts
• 10. Glossary of Abbreviations

• Table 1 – Country statistics – 2011 (e)
• Table 2 – Telephone network statistics – 2011 (e)
• Table 3 – Internet user statistics – 2011 (e)
• Table 4 – Broadband statistics – 2011 (e)
• Table 5 – Mobile statistics – 2011 (e)
• Table 6 – National telecommunications authority
• Table 7 – Telecom revenue – 2008 - 2013
• Table 8 – Market share of revenue and subscribers by operator – 2010
• Table 9 – IT market revenue and growth – 2004 - 2012
• Table 10 – TP interconnection rates – 2006 - 2009
• Table 11 – LLU as proportion of DSL lines – 2008 - 2012
• Table 12 – Numbers ported – 2009 - 2010
• Table 13 – Fixed-line telephony revenue and subscribers – 2005 - 2012
• Table 14 – Market share of revenue by operator – 2010
• Table 15 – Market share of subscribers, TP and altnets – 2006 - 2012
• Table 16 – Market share of revenue, TP and altnets – 2006 - 2012
• Table 17 – TP total retail lines and ARPU – 2009 - 2011
• Table 18 – TP fixed-line ARPU – 2009 - 2011
• Table 19 – TP Group financial data – 2006 - 2011
• Table 20 – Netia financial data – 2007 - 2011
• Table 21 – Netia subscribers by type – 2008 - 2011
• Table 22 – Exatel financial data – 2009 - 2010
• Table 23 – Fixed lines in service and teledensity – 2000 - 2013
• Table 24 – Wholesale lines by type – 2009 - 2010
• Table 25 – Cost of local loop unbundling and shared access – 2006 - 2009
• Table 26 – Broadband market revenue by sector – 2006 - 2012
• Table 27 – Proportion of broadband market revenue by sector – 2006 - 2010
• Table 28 – Broadband penetration by technology – 2009 - 2012
• Table 29 – Workplace network usage by network type – 2006 - 2011
• Table 30 – E-education usage by individuals – 2007 - 2011
• Table 31 – E-education usage by businesses – 2007 - 2011
• Table 32 – Online purchases by individuals – 2005 - 2012
• Table 33 – Electronic sales as percentage of total non-VAT turnover for non-financial sector businesses with 10 or more employees – 2009
• Table 34 – Uptake of e-government services by businesses – 2004 - 2011
• Table 35 – Uptake of e-government services by individuals – 2004 - 2011
• Table 36 – Internet users, subscribers and penetration rates – 2000 - 2012
• Table 37 – ISP market share – 2008 - 2010
• Table 38 – Fixed broadband subscribers and penetration rate – 2001 - 2012
• Table 39 – Fixed broadband subscribers by data speed – January 2010
• Table 40 – TP broadband and IPTV ARPU – 2008 - 2011
• Table 41 – UPC Poland subscribers – 2008 - 2011
• Table 42 – Cable market share of subscribers by operator – 2010
• Table 43 – TP DSL subscribers – 2003 - 2011
• Table 44 – Netia DSL subscribers – 2008 - 2011
• Table 45 – DSL market share of subscribers by operator – 2010
• Table 46 – Mobile broadband market share of subscribers by operator – 2010
• Table 47 – Mobile broadband subscribers and penetration rate – 2004 - 2012
• Table 48 – Orange dedicated mobile broadband subscribers – 2007 - 2011
• Table 49 – Proportion of subscribers to bundled services by type – 2010
• Table 50 – Market share of TV and broadband bundles by operator – 2010
• Table 51 – TP Livebox, IPTV customers – 2008 - 2011
• Table 52 – Netia financial data and annual change – 2007 - 2011
• Table 53 – Netia subscribers by type – 2008 - 2011
• Table 54 – Cable TV market share by operator – Mar 2011
• Table 55 – Cable TV subscribers –2010 - 2011
• Table 56 – UPC – homes passed – 2003 – 2011
• Table 57 – UPC – subscribers by service type – 2003 - 2011
• Table 58 – Multimedia Polska financial data – 2009 – 2011
• Table 59 – Multimedia Polska subscribers – 2009 - 2011
• Table 60 – Multimedia Polska triple play subscribers by service – 2009 - 2011
• Table 61 – Cyfrowy Polsat financial data – 2004 - 2011
• Table 62 – Cyfrowy Polsat operational data – 2004 - 2011
• Table 63 – Cyfrowy Polsat ARPU, SAC – 2004 - 2011
• Table 64 – N financial data – 2010 - 2011
• Table 65 – N subscriber data – 2010 - 2011
• Table 66 – TP DTH subscribers – 2008 - 2011
• Table 67 – Mobile market revenue – 2009 - 2012
• Table 68 – Mobile subscribers and penetration rate – 1995 - 2012
• Table 69 – Mobile market share of revenue by operator – 2009 - 2010
• Table 70 – Mobile market share of subscribers by operator – 2009 - 2010
• Table 71 – Mobile market traffic and annual change – 2009 - 2012
• Table 72 – Mobile number portings – 2010 – 2011
• Table 73 – Retail roaming charges, voice, SMS, data – 2010, 2012 - 2015
• Table 74 – Roaming traffic (voice, SMS, data) – 2007 - 2010
• Table 75 – Orange mobile revenue – 2010 - 2011
• Table 76 – Orange subscribers – 2007 - 2011
• Table 77 – Orange total monthly ARPU and MOU – 2008 - 2011
• Table 78 – Orange data ARPU share – 2008 - 2011
• Table 79 – Polkomtel subscribers – 2009 - 2010
• Table 80 – Polkomtel financial data – 2009 - 2011
• Table 81 – Polkomtel annualised ARPU – 2008 - 2009
• Table 82 – T-Mobile subscribers – 2007 - 2011
• Table 83 – T-Mobile financial data – 2005 - 2011
• Table 84 – T-Mobile ARPU and churn – 2005 - 2011
• Table 85 – Ratio of prepaid to postpaid subscribers – 2003 - 2012
• Table 86 – Orange prepaid subscribers – 2003 - 2011
• Table 87 – T-Mobile prepaid subscribers – 2005 - 2011
• Table 88 – Polkomtel prepaid subscribers – 2005 - 2010
• Table 89 – SMS messages sent and annual growth– 2006 - 2012
• Table 90 – MMS messages sent and annual growth– 2006 - 2012
• Table 91 – Mobile data traffic– 2008 - 2012
• Table 92 – Forecast fixed broadband subscribers – higher growth scenario – 2010 - 2013; 2020
• Table 93 – Forecast fixed broadband subscribers – lower growth scenario – 2010 - 2013; 2020

• Chart 1 – Fixed-line telephony revenue and subscribers – 2005 – 2012
• Chart 2 – Market share of subscribers, TP and altnets – 2006 – 2012
• Chart 3 – Market share of revenue, TP and altnets – 2006 – 2012
• Chart 4 – TP total retail lines and ARPU – 2009 – 2011
• Chart 5 – TP Group financial data – 2006 – 2011
• Chart 6 – Netia financial data – 2007 – 2011
• Chart 7 – Netia subscribers by type – 2008 – 2011
• Chart 8 – Exatel financial data – 2009 – 2010
• Chart 9 – Broadband market revenue by sector – 2006 – 2012
• Chart 10 – Proportion of broadband market revenue by sector – 2006 – 2010
• Chart 11 – Fixed broadband subscribers and penetration rate – 2001 – 2012
• Chart 12 – UPC Poland subscribers – 2008 – 2011
• Chart 13 – Netia financial data and annual change – 2007 – 2011
• Chart 14 – Netia subscribers by type – 2008 – 2011
• Chart 15 – UPC – subscribers by service type – 2003 – 2011
• Chart 16 – Multimedia Polska financial data – 2009 – 2011
• Chart 17 – Multimedia Polska subscribers – 2009 – 2011
• Chart 18 – Cyfrowy Polsat financial data – 2004 – 2011
• Chart 19 – Mobile subscribers and penetration rate – 2000 – 2012
• Chart 20 – Orange subscribers – 2007 – 2011
• Chart 21 – Orange total monthly ARPU and MOU – 2008 – 2011
• Chart 22 – Polkomtel subscribers – 2009 – 2010
• Chart 23 – Polkomtel financial data – 2009 – 2011
• Chart 24 – T-Mobile financial data – 2005 – 2011

• Exhibit 1 – The EU Regulatory Framework for communications
• Exhibit 2 – Access, the local loop and unbundling – an overview
• Exhibit 3 – 2G spectrum awarded in Poland