Tight competition and regulatory price cuts challenge MVNO stance in Europe
ad hoc study
Of the 43 countries that we monitor in Europe, 10 of which show that MVNOs hold a significant subscriber base. Germany leads where MVNOs in the market hold around 34% subscriber share at end-2014, followed by Belgium (17%), UK (17%), Spain (15%) and Netherlands (15%) - indicating a very competitive mobile market between MNOs and MVNOs. This is followed by Austria, France, Denmark, Norway and Switzerland where MVNOs hold 7% to 10% share of the market. Although some have experienced declining market shares (e.g France and Germany), MVNOs in general continue to find success in targeting niche markets in this region — be it among the increasing population of foreigners and immigrants or by having an established distribution network to cross-sell their mobile services to (in the case of CaTV players, utility companies or retail centres). However, market saturation and the ever growing price competition that MVNOs face with MNOs have slowed down their subscriber uptake in the recent years. Together with the recent regulation imposed by the EU with regards to roaming charges, this could possibly be even more disruptive to their business models. While this is the case, InfoCom believes that there are still untapped or underserved areas to explore for MVNOs which could potentially yield higher returns.