Poland is one of the largest telecoms markets in Central and Eastern Europe, with vibrant competition across all market segments. This has benefited consumers through service innovation and lower prices, however operators' aggressive marketing strategies have increased the downward pressure on ARPUs, which continue to trend downwards. In light of this recent experience operators are targeting growth of high value high-speed fixed broadband subscription growth, as well as mobile broadband growth via dedicated subscriptions and smartphones. These opportunities should allow operators to develop data revenues and help offset declines in traditional services revenues.
- The mobile market growth has slowed as penetration rates have rise, but remains in positive growth territory. Total subscriptions increased 1.8% quarter-on-quarter (q-o-q) in Q313 to reach 55.393mn, equal to penetration of 145.3%.
- Monthly blended mobile ARPU declined sharply year-on-year (y-o-y) to Q313 as a result of comparisons with H112, when Poland hosted the UEFA Euro football championships, while cuts to termination rates also pushed down ARPU.
- The latest data from the European Commission show growth in dedicated mobile broadband subscriptions outperformed, up 21.2% y-o-y to 3.86mn at YE12, compared with a 3.5% increase in fixed broadband subscriptions to 7.123mn over the same period.
Key Trends And Developments
In August 2013, the Polish telecoms regulator UKE, began a public consultation on the auction of spectrum in the 800MHz and 2,600MHz bands, which could result in the entry of Emitel into the mobile broadband market. The government aims to switch from analogue to digital TV before end-2013, thus freeing up digital dividend spectrum (800MHz) for the use of wireless communications. Local news sources suggested Emitel was considering participation in the new tender for 4G spectrum and given its recent history and the huge advantages it would bring the company, we believe it would be interested.
Matters took an interesting turn when, in December 2013, Emitel's owners sold the company to an infrastructure investment specialist. Although the new owner has yet to say what its strategy is regarding Emitel, BMI suggests it could be following the lead of Emitel's Czech counterpart, Ceske Radiokomunikace, in looking to acquire the mobile operators' infrastructure. As is the case in the Czech Republic, we believe the mobile operators may be amenable to selling their infrastructure as they look to reduce operating costs and fully monetise their investments in passive and active infrastructure.