2009 Turkey - Telecoms, Mobile, Broadband and Forecasts

BuddeComm’s annual publication, Turkey - Telecoms, Mobile, Broadband and Forecasts, provides a comprehensive overview of the trends and developments in the telecommunications and digital media markets in Turkey.

The big change in the market in 2009 will be the introduction of 3G mobile services. This will impact both Turkey’s mobile market, which has seen low growth over the past year, and its broadband market, which is growing strongly.

3G licences were awarded in 2008 and the operators plan to launch services before end-2009. It is expected that there will be considerable demand for services and the operators will be hoping that increased data usage will revive ARPU growth and offset difficulties caused by the economic recession.

Like most countries in the Middle East, Turkey has a thriving and competitive mobile market, falling fixed-line penetration and low Internet and broadband penetration. Economic growth is expected to be negative in 2009 and this will hit all sectors of the market.

The telecoms market has been mostly liberalised with a number of alternative 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 and lack of significant competing infrastructure. In addition, the retail share of its subsidiary TTnet is near 95%. It will need to work hard to retain its market dominance however, as the mobile operator Turkcell is also investing in considerable fibre infrastructure through its subsidiary Tellcom. Turkcell has also bought a major ISP. Cable broadband services are also available, with a small, but growing market share.

These factors have led to very healthy growth rates in the number of broadband subscribers. A large majority of all Internet subscribers are now broadband subscribers.

Turkey’s mobile market is showing signs of saturation, with low growth rates and declining ARPUs. Three operators share the market but Turkcell is very dominant with a market share comfortably over 50%. Turk Telekom’s mobile subsidiary is the smallest operator but is much the fastest growing of the three. All three operators have significant foreign ownership.

Key highlights:

·         Mobile penetration in Turkey was around 100% in mid-2009, a large market with a population of nearly 70 million served by three very competitive operators.

·         3G mobile licences have been awarded to the three operators, with launch of services expected in 3Q 2009.

·         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.

·         Fixed-line subscribers are declining quite quickly with a growth rate only a little above -4%.

·         Turkey has a very healthy broadcasting sector, with terrestrial, cable and satellite channels.

Turkey – key telecom parameters – 2008 - 2009

(Source: BuddeComm)

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.