The total broadband subscriptions in the EU-28* stood at roughly 225m subscriptions in 1H18, up by 2% compared to a year ago. According to InfoCom’s quarterly broadband monitoring report, a large majority of these connections were represented by fixed broadband, while the share of subscriptions via 3G/4G and data cards has continued to decline with 0.3p.p. YoY – although it still represents more than a quarter. The lower share for mobile broadband is mainly attributed to the double-digit losses in subscriptions posted by the large markets (i.e. Italy, Germany, Spain, France, and the UK at an average of -5% YoY), despite the significant development in markets like Lithuania, Switzerland, Malta, Slovenia, and Austria for the period (average of 13% YoY). This is since fixed broadband is still mainly prioritised in most markets due to the high bandwidth capacities considering the continued innovations (e.g. Vectoring, G.fast, etc), and the active marketing of multi-play offers. The increasing popularity of mobile Internet offers (i.e. not via USB modems or sticks, etc.) was also seen as another culprit for slower mobile broadband adoption – especially in countries where both LTE coverage and fixed broadband is already high (e.g. Sweden, Portugal).
As we observed, mobile dominated markets (e.g. Austria, Finland, Bulgaria, etc.) remained to exhibit the strongest development in mobile broadband, especially since the wide network coverage is complemented by competitively priced mobile broadband offers. For instance, in Bulgaria, Vivacom’s SMART U tariff (highest-tiered) offers an unlimited mobile Internet and data volume (max. 112 Mbps) with 8 000 MB of roaming data across the EU countries for BGN 50 (around EUR 26) per month (one-year contract). This offer is relatively competitive than its fibre-based broadband service, FiberNet 300, capable of 300 Mbps/100 Mbps bandwidths for a standard price of BGN 80 (around EUR 41) per month (one-year contract). As per InfoCom's monitoring, the total mobile broadband penetration rate in the market has grown by over 4p.p. YoY, following Estonia, Finland, and Austria, in terms of household penetration. Note that we also observed faster pick-up of mobile broadband in smaller markets like Lithuania, Malta, and Slovenia as a result of the expanded network coverage and aggressive discount offers for convergent services (however, these markets have a smaller user base compared to other markets monitored). This aside, we also observed some network investments related to 5G which we see as a catalyst for a potential improvement in the take-up of mobile broadband in the region – considering that around 70% of the countries covered still registered below the EU28* average in terms of mobile broadband penetration rate per inhabitant.
*EU28 + NO and CH
The Indonesian telecommunications market sustained its growth trajectory in 2017, and it is still more likely to be the case for 2018 – especially for broadband services. In general, the increasing popularity of multiple play offers resulted in faster service take-up of broadband (e.g. FTTP and LTE), which was supported by active network expansions. For instance, Telkom Indonesia has rolled out more than 7m Optical Distribution Ports (ODP) across the country, with more than 155 524 km of fibre optic backbone networks. This was complemented by the operator’s deployments and copper network upgrades in areas like Jakarta, Bogor, Depok, and Tangerang since 2016. As per InfoCom's monitoring, the operator has almost 3m FTTH subscribers which generally buoyed the operator’s total fixed broadband subscriber base (now comprises 84% of the total market).
Network expansions and trials of next generation mobile networks have also resulted in the continued take-up of mobile services in the country – considering that most network investments during the year focused on advanced mobile technologies (e.g. 4.5G). In particular, XL Axiata has started to extend its “4.5G-ready” mobile networks in the Thousand Islands area, in addition to its earlier deployed stations in the islands of Kelapa, Pantara, Pari, Pramuka, and Putri. Meanwhile, Smartfren Telecom started its trials of Massive Multiple Input, Multiple Output (MIMO) and Multi-Antenna Space Division Multiple Access (SDMA) technologies in partnership with ZTE, as the operator’s initial step towards 5G adoption. This was in parallel with the prior activity of Telkomsel (Telkom Indonesia) in partnership with Huawei wherein both companies held a live 5G demo, claiming that the said technology can achieve up to 70 Gbps data speeds. InfoCom considers these activities as preparatory towards the eventual 5G adoption which could propel further mobile development in the country despite the increasing market saturation.Contact us for more information