to customers taking advantage of the
newly introduced MNP, but it would
appear that churn attributable to the
introduction of MNP might have since
settled down.
According to European Commission
statistics, however, the number
of ported numbers is increasing, and
reached more than 95,000 at end-2006.
A dispute is pending with the CTU
regarding the financing mechanism
for the mobile porting system. In line
with the decision by the Supreme
Administrative Court, in the case of
fixed-term contracts, however, only
subscribers eligible to terminate their
contract are allowed to use the number
portability service.
As the Czech market has reached
saturation and prepaid subscriptions
remain the majority, it appears
that the battle for more postpaid
subscriptions has replaced the one
for market share. At the beginning
of the year postpaid subscriptions
accounted for 40.97 per cent of total
subscriptions in the market, a six
per cent increase on the figure at
end-Q405. TelefonicaO2 was the first
Czech operator to focus on migrating
its prepaid subscriptions to postpaid,
and at end-Q406 postpaid accounted
for 40 per cent of TelefonicaO2’s
subscription base, up 5.2 per cent
from end-2005.
As mentioned above, Vodafone has
the highest percentage of postpaid
subscriptions. T-Mobile has the lowest,
with just 36.54 per cent, but the
figure has been creeping up in recent
quarters.
In a further fight against slipping
voice ARPU the carriers must now
make a genuine effort to leverage
their 3G investments. For while Czech
subscribers are heavy SMS users—in
2006, subscribers sent more than 5.5
billion messages—data revenues remain
unspectacular. Data represented
only 21 per cent of TelefonicaO2’s
and T-Mobile’s revenue at the start
of the year.
In June 2006, TelefonicaO2’s old
NMT network was closed and existing
customers migrated to the
carrier’s GSM and UMTS networks.
All three operators run dual-band
GSM900/1800 networks, which have
always dominated the market.
However, the Czech Republic is one
Mobile Communications International | First for news, best for business
FACTFILE Data provided by WCIS | For related regional data: www.wcisdata.com email: telecoms.enquiries.com
CZECH REPUBLIC MOBILE SUBSCRIPTIONS AND MARKET SHARE BY OPERATOR, 3Q05-4Q06
of the few European markets where
CDMA technology has been deployed,
with TelefonicaO2 having launched
a 1xEV-DO network in September
2004. It is dedicated to data, and has
hardly set the market alight—after
nine quarters it accounted for less
than one per cent of the total market
at end-2006.
In December 2001, T-Mobile and
TelefonicaO2 were awarded UMTS
licences for CZK3.9bn ($159m) and
CZK3.5bn ($143m) respectively. Vodafone
was awarded the third Czech
UMTS licence in February 2005 for a
fee of CZK2bn ($81.6m). The operator
had declined to participate in the
original tender, stating that the asking
price was too high and the conditions
unrealistic.
In July 2006, Vodafone announced
that it would halt the development
of its WCDMA network, as it believed
it would not generate the revenues
required for a significant return on
investment. But the carrier’s licence
conditions stipulate that it should
launch 3G by 1st January 2008, although
it may look to do so earlier.
Vodafone has generally been ahead of
its European competitors in terms of
launching 3G and will be able to draw
on its experiences in other markets
when it brings the technology to the
Czech Republic.
It appears that Vodafone is considering
alternative routes to 3G in
the Czech Republic as, shortly after
revealing the development hiatus on
its own network, it announced that
it had entered into discussions with
T-Mobile on network sharing.
No details have been issued regarding
the nature of the network sharing,
Q105 Q405 Q106 Q206 Q306 Q406 Q107 Q207
T-Mobile (000s) 4,533 4,634 4,648 4,734 4,823 5,049 5,109 5,140
T-Mobile market share (%) 40.99 40.11 39.83 39.84 40.25 40.65 41.70 41.46
Telefonica O2 (000s) 4,489 4,778 4,807 4,885 4,849 4,958 4,683 4,731
Telefonica O2 market share (%) 40.59 41.36 41.2 41.11 40.47 39.92 38.22 38.17
Vodafone (000s) 2,038 2,140 2,214 2,263 2,311 2,413 2,461 2,525
Vodafone market share (%) 18.43 18.52 18.97 19.05 19.29 19.43 20.08 20.37
Total subs (000s) 11,060 11,552 11,669 11,882 11,983 12,420 12,253 12,396
MARKET ANALYSIS
but it is likely that the two operators
may consider building a UMTS FDD
(WCDMA) network together, as T-Mobile
has only a UMTS TDD network in
the Czech Republic, which operates
in the 1.9GHz band in Prague from
October 2005.
Another possible avenue for network
sharing could be mobile TV,
as, according to Vodafone Czech Republic’s
CEO Grahame Maher, the
three Czech operators have reached
a tentative agreement that there will
be only one mobile TV network and
not three. TelefonicaO2 has yet to
enter into any full network-sharing
agreements, but Vodafone is hopeful
that it will also join in.
The challenges facing the three
carriers in the Czech Republic are
hardly unique. However, the country
has a buoyant economy and the MNOs
present have a wealth of experience
operating in similarly saturated markets
throughout Europe. The slow but
steady migration of prepaid customers
to postpaid subscribers will help boost
blended ARPU.
It is from highly competitive markets,
such as the Czech Republic, that
the industry is likely to see genuine
innovation taking place. Carriers’ 3G
networks are going to have to start
paying back on the huge investments
made. While talk of a shared mobile
TV broadcast network, if successful,
could point the way for the rest of
Europe. �
This article draws on in-depth regional
and company focuses that can
be found at Informa Telecoms & Media’s
Intelligence Centre. Find out more at:
www.intelligencecentre.net or email:
telecoms.enquiries@informa.com.
Source: Informa Telecoms & Media
31
To view a Ceros magazine you need to have JavaScript enabled in your browser and have the flash player 8 or higher installed. To install the latest flash player, click the icon above, install the flash plugin and then click here to refresh this page.