Dutch mobile market revenues drop 6.7% in Q2 2013

Dutch mobile market revenues drop 6.7% in Q2 2013

Dutch mobile service revenues contracted 6.7 percent year-on-year in the second quarter of 2013 to a total EUR 1.38 billion. According to independent market researcher Telecompaper’s quarterly mobile monitor, the annual rate of decline is more than twice that of the same period last year, as a drop in non-voice revenue (SMS and data) added to the continued fall in voice revenues.

Seasonally the second quarter is stronger than the first, but this year’s quarterly growth of 0.6 percent was a third of last year’s rate, with revenues increasing by only EUR 8 million. Non-voice services now contribute 40 percent of total mobile service revenue, but these are not growing fast enough to offset fully the erosion in voice revenues.

The weak market performance in the first half of 2013 has led to a downgrade in Telecompaper’s outlook for the Dutch mobile industry. For 2013 we now expect the Dutch market to show a decline of around 6 percent to EUR 5.5 billion in service revenue over the full year. For the period 2013-2017, the Dutch market is expected to show a negative CAGR of 2.5 percent, reaching around EUR 5.1 billion in revenues in 2017.

The reduced forecast is due to the slowdown in data revenue growth, which can no longer compensate fully for the drop in voice revenues. The latter will also be impacted by a new cut to termination rates from September. In addition, the slow economic recovery in the Netherlands, continued regulation and a greater impact from OTT and Wi-Fi services are putting pressure on revenues. “Regulation as well as the shift in customer behavior to more data-centric services will force operators to make further changes to their pricing in order to counteract the continuous drop in voice revenues,” said Alejandra van de Roer, Telecompaper senior research analyst and author of Telecompaper’s quarterly mobile market monitor for The Netherlands

In the second quarter, only Vodafone increased its market share of service revenues on an annual basis, at the expense of T-Mobile and KPN. T-Mobile was the only operator to grow revenue on a quarterly basis, leading to a sequential improvement in its market share. KPN showed the largest absolute decline in revenues across both periods.

In terms of mobile SIMs (including MVNOs), the Dutch market saw a slight decrease of 0.4 percent annually to 20.3 million at the end of June 2013.* As a consequence mobile market penetration decreased from 121.7 percent at the end of June 2012 to 120.9 percent this year. KPN’s market lead eroded slightly to 44 percent of subscribers, while Vodafone saw its market share increase to 30 percent, and T-Mobile was also up slightly, to around 26 percent.

*Note: Due to a change in reporting, these figures exclude M2M SIMs. As a result, total subscribers and market shares cannot be compared to previous Telecompaper releases.

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