2012 Spain - Telecoms, IP Networks, Digital Media and Forecasts

DTT may lose half channel capacity in 2015

BuddeComm’s annual publication, Spain - 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 Europe’s largest countries. The report includes the regulator’s market data to the end of 2011 and 2012 updates, telcos’ financial and operating data to March 2012, and market developments into mid-2012.

Economic background

Spain’s economy has been among the worst affected by the global financial crisis. In mid-2012 the newly elected government set in train a new round of austerity measures aimed at cutting a further €65 billion off the state budget by 2015. The Eurozone stepped in to fund Spanish banks with some €30 billion, while overall banking assistance has reached €100 billion. Falling GDP and collapsing tax revenue has slowed economic recovery and forced the government to ease its deficit reduction schedule, amending this to 2.8% of economic output by 2014.

Telecom market overview

Spain’s telecom market is one of the largest in Europe, accounting for around 4% of GDP. Market revenue has fallen steadily in recent years, a trend likely to continue to 2013 as the economic crisis dampens consumer spend. The deregulated market remains dominated by Telefónica though the operators is steadily losing market share in revenue and subscribers. Investment in broadband and mobile networks has defied the economic slowdown as operators struggle to secure future revenue from emerging digital content and services.

Mobile market

Mobile revenue will be under pressure to 2014 as the market responds to regulatory measures and competitive pressure on pricing, as also on the economic climate. Improved revenue from data and subscriptions has helped slow down overall revenue declines. Spectrum originally set aside for DTT from 2015 may be reallocated for mobile broadband.

Key telecom parameters – 2010; 2013

(Source: BuddeComm)

Market Highlights

• TeliaSonera in mid-2012 appointed a bank to manage its potential sale of Yoigo. The move may lead to further market consolidation, or allow outside players such as the acquisitive America Movil to establish a base in Spain.
• Telefónica has activated an LTE network using the 2.6GHz band, reporting downloads at up to 100Mb/s and uploads ranging at between 40Mb/s and 60Mb/s.
• The number of subscribers has fallen dramatically in 2011 following the end of a promotion undertaken by Movistar.
• Government proposals that the 45 channels available on DTTV may be reduced by half 2015 reflects the sector’s poor business sustainability as well as the potential to secure €2 billion from operators which would use the freed frequencies to develop mobile broadband services.
• The FttH subscriber base may reach 270,000 by the end of 2012, showing strong growth at the expense of the cable and DSL sectors.

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