Quarterly Broadband Monitoring
At mid-2012, Western Europe registered around 132m fixed broadband subscribers, a 5% increase year-on-year. The increase is slower than in the previous years as the region is nearing saturation as it can be seen in markets such as Luxembourg and the Netherlands, that present already very high penetration rates per household (93.4% and 98.3% respectively).
xDSL, the most popular service in the region in terms of subscription, started to slow down its growth pace — +3% YoY during the second quarter, that is around 584 000 net adds. The slowdown in subscription growth can be explained by a cannibalisation effect cased by other broadband platforms as it is clearly the case in Scandinavia — Denmark (-2%), Norway (-7%), and Sweden (-4%), but also in other European countries, for instance in Ireland (-5%), and in the Netherlands (-2%).
Thanks to effective bundling strategies and faster speed offers, both cable modem and FTTx have posted relatively faster growth rates. Notably, cable modem is the technology that drives the growth rate for the region. The service has posted an over 10% increase (YoY), with high peaks in several markets, in Central Europe — for instance in Germany (28%), in Luxembourg (15%) and the Netherlands (11%) — but also in some markets of Northern Europe, such as Finland (16%) and Norway (12%).
Despite high subscription growth rate at 26% YoY, broadband subscriptions over FTTx develop yet slowly as large markets such as Germany and United Kingdom have just started promoting the service. As of 2Q12, the FTTx share is just around 3% of the total fixed broadband subscription base.
In the next 5 years, Western Europe is expected to expand further its broadband subscriber base albeit at a slower pace. The whole region is expected to grow at an overall 3% a year (CAAGR from 2012 to 2017) driven by FTTx, expected to grow with a double digit pace at 13% a year (CAAGR from 2012 to 2017) while cable modem is expected to grow at 5% a year (CAAGR from 2012 to 2017). xDSL subscriptions are expected to keep growing at around 3% a year over the whole period. As a consequence of this different trends, in 2017 the fixed broadband subscription base will show some structural changes, with xDSL representing some 75% of the total fixed broadband base, cable moden around 19% and FTTx some 6%.