Europe - Mobile Market - Statistics and Analyses

Synopsis

While population increases across Europe mean that there is a steady influx of new mobile subscribers, the market has a sufficiently high penetration rate that growth is largely lateral, in that subscribers are migrating from 2G to 3G and LTE networks. As a result, the proportion of 2G subscribers is falling sharply, and while there remains steady, if slow, growth in the 3G sector this will also begin to fall from late 2017 or 2018 as subscribers shift to LTE networks.

This movement is being encouraged by network operators which hope to capitalise on revenue derived from greater take-up of mobile broadband and data services. This sector will be the main area for revenue growth in coming years: voice and basic data services are no longer the cash-cows of former times, attributed in part to the large number of minutes and messages included in bundles, as also to the fast-growing adoption among subscribers of OTT voice and data services. This has resulted in lower SMS traffic for MNOs, and consequently lower revenue. These market conditions are exacerbated by ongoing regulatory measures aimed at reducing termination rates and roaming charges. After many years in which roaming charges were reduced incrementally, the European Commission (EC) has mandated that international roaming charges will end in June 2017. Customers will thereafter be charged at domestic roaming rates only.

Price pressure continues from market competition. This is less prevalent from among MVNOs, which tend to be focussed on niche markets, have a relatively small subscriber base and (often) disadvantageous conditions imposed by their host networks. As with Latin America and Africa, the region is notable for having half a dozen pan-European operators with interests in several key markets. These main players include Deutsche Telekom, Telefónica, Vodafone Group, Hutchison and TeliaSonera. There has been much jostling among these operators as they seek to strengthen their presence in particular markets. This has in turn caused some disquiet among national regulators and European competition authorities, which are keen to preserve a quorum of key players (generally four) within a given market. It was in the interest of maintaining effective competition that the proposed sale of O2 UK to Hutchison was opposed, since this would have reduced the number of MNOs to three. Regulators are mindful that reduced market competition could jeopardise operator investment in network infrastructure and upgrades at a time when the EC is pushing for universal 100MB/s broadband availability. This goal can only be achieved through the deployment of improved LTE networks and the adoption of networks based on the forthcoming 5G standard, both of which require further investment among operators,

This report provides statistics and analyses on Europe’s mobile phone market in the wake of evolving regulatory and operating challenges. It includes data on subscriber numbers among the key operators, as well as mobile penetration and market share among incumbents. The report also details issues related to roaming, spectrum and emerging technologies.

Key developments

International roaming charges set to end; EC to consider new rules governing OTT messaging services; EC tightens control on MNO merger and acquisition activity; EC developing strategy to use the 700MHz band for mobile broadband; operator data to Q2 2016; progress with 5G; recent market developments.

Companies mentioned in this report:

Telekom Deutschland, Telefónica, Vodafone Group, Orange Group, H3, Telecom Italia.

Table of Contents

  • 1. Synopsis
  • 2. Market analysis
    • 2.1 Competition concerns central to M&A activity
    • 2.2 Investment considerations
  • 3. Regulatory environment
    • 3.1 Introduction
    • 3.2 Roaming
    • 3.3 Mobile Number Portability (MNP)
    • 3.4 Network sharing
    • 3.5 Spectrum issues
      • 3.5.1 900MHz
      • 3.5.2 Digital dividend spectrum
    • 3.6 5G developments
  • 4. Major mobile operators
    • 4.1 O2 Group
    • 4.2 Orange Group
    • 4.3 Telekom Deutschland
    • 4.4 TeliaSonera
    • 4.5 Vodafone
    • 4.6 H3
    • 4.7 Mobile Virtual Network Operators (MVNOs)
  • 5. Related reports
  • Table 1 – Incumbent MNOs’ market share - 2015
  • Table 2 – SIM penetration by country – 2012 – 2016
  • Table 5 – O2 mobile subscribers – key European markets - 2005 - 2016
  • Table 6 – O2 Group turnover and EBITDA – 2007 - 2016
  • Table 7 – O2 Group blended monthly ARPU – 2006 - 2016
  • Table 8 – O2 Group LTE subscribers – 2014 - 2016
  • Table 9 – O2 Group LTE penetration – 2014 - 2016
  • Table 10 – Orange Group mobile subscribers by sector – 2005 - 2016
  • Table 11 – Orange MVNO subscribers – 2005 - 2016
  • Table 12 – Orange Group mobile revenue – 2008 - 2016
  • Table 13 – Telekom Deutschland subscribers in selected European countries – 2001 - 2016
  • Table 14 – Telekom Deutschland ARPU in selected European countries – 2006 - 2016
  • Table 15 – TeliaSonera mobile subscribers, select countries – 2009 - 2016
  • Table 16 – Vodafone blended ARPU (principal markets) - 2009 - 2016
  • Table 17 – Vodafone subscribers (principal markets) - 2005 – 2016
  • Table 18 – Vodafone voice usage - 2007 - 2016
  • Table 19 – Vodafone Group revenue by sector (old style) – 2007 - 2013
  • Table 20 – Vodafone Europe revenue by sector (new style) – 2013 - 2016
  • Table 21 – H3 subscribers (registered) - 2009 - 2016
  • Table 22 – H3 Europe active subscribers and data use - 2009 - 2016
  • Table 23 – H3 revenue – 2011 - 2016
  • Table 24 – H3 blended annualised ARPU – 2010 - 2016
  • Chart 1 – O2 Group mobile subscribers – 2005 – 2016
  • Chart 2 – O2 Group turnover and EBITDA – 2007 – 2016
  • Chart 3 – O2 Group blended monthly ARPU – 2006 – 2016
  • Chart 4 – Telekom Deutschland subscribers in selected European countries – 2001 – 2016
  • Chart 5 – Telekom Deutschland ARPU in selected European countries – 2006 – 2016
  • Chart 6 – TeliaSonera Mobile subscribers – 2009 – 2016
  • Chart 7 – Vodafone blended ARPU (principal markets) - 2009 – 2016
  • Chart 8 – Vodafone subscribers (principal markets) - 2005 – 2016
  • Chart 9 – Vodafone voice usage - 2007 – 2016
  • Chart 10 – H3 subscribers - 2009 – 2016
  • Exhibit 1 – European 3G network sharing agreements

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Number of pages 27

Status Current

Last updated 21 Sep 2016
Update History

Analyst: Henry Lancaster

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