2013 Romania - Telecoms, IP Networks, Digital Media and Forecasts

LTE launches in 2013 herald renewed emphasis on mobile broadband solutions

BuddeComm’s annual publication, Romania - Telecoms, IP Networks, Digital Media and Forecasts, provides a comprehensive overview of the trends and developments in the telecommunications and digital media sectors of one of Eastern Europe’s most progressive and fast-moving markets. The report includes the regulator’s H1 2012 market data, telcos’ operating and financial data to Q4 2012 and market developments to May 2013.

Economic background

Romania’s economy has been one of the hardest hit among Eastern European countries. Unpopular austerity measures have led to social disruption, and social and political tension led to a new government being elected in late 2012. Lower exports to EU markets have resulted in less tax revenue and the closure of local businesses. Although GDP grew 2.5% in 2011 it sunk to 0.9% in 2012. The IMF anticipates that GDP would grow by 2.5% in 2013, increasing to 3% to 3.5% annually to 2017.

Telecom market overview

Telecom market revenue has contracted year-on-year since 2009, partly due to the 30% regulated cut in MTRs, growing competition and falling prices for services. Five operators – Orange, Vodafone, RomTelecom, Cosmote and RCS&RDS – between them account for 90% of revenue. Moderate growth is expected from the mobile telephony and internet sectors in 2013, though this will barely offset the continuing decline in fixed telephone revenue. The fixed-line market will continue to see a shift among consumers to mobile services, resulting in a declining share of overall sector revenue.

Broadband market

Investment in FttH networks has stepped up since 2010 when operators retreated through uncertain economic conditions. This meant that attention was focussed on cheaper FttC deployments. Fibre is the fastest growing fixed broadband sector, and by mid-2013 there were about 3.3 million connections.

Key telecom parameters – 2010; 2013

(Source: BuddeComm)

Market Highlights

• Cosmote launch commercial LTE services in May 2013, providing data at up to 75Mb/s. The network complements the DC-HSPA+ network which provides over 50% population coverage.
• RomTelecom reported a continuing drop in revenue in 2012, mainly due to a significant fall in the number of lines. As of a result of financial pressure, the company is significantly reducing its workforce in a bid to improve operations and increase efficiency. The company also appointed a new CEO to manage its turnaround.
• In early 2013 RomTelecom adopted a new brand identity, with the company’s spin-off brands Clicknet and Dolce (for internet and TV services) were united under the Dolce brand.
• In late 2012 legislation was passed aimed at setting up transparent and non-discriminatory procedures enabling telcos to access ducts on public property. It also regulates access to telecom infrastructure, including shared usage of networks.

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

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