New Market Report: Switzerland Telecommunications Report Q4 2013

Switzerland remains one of the most lucrative telecoms markets in Western Europe, and globally. Subscription growth continued and LTE was launched in 2012, with a competitive LTE market in place from June 2013. However, at the same time ARPU declined sharply as price competition has intensified. Even after this decline, Switzerland remains one of the highest value mobile markets globally, underpinned by high incomes and demand for advanced services. We believe it has subscription growth potential exceeding many of its developed market peers, while high incomes and technological literacy creates strong foundations for higher capacity service growth ie fibre and LTE. The outlook is bright for the wireless and wireline markets, despite the squeeze from market saturation and threats to traditional revenues from IP alternatives.

Full Report Details at
- http://www.fastmr.com/prod/673275_switzerland_telecommunications_report_q4_2013.aspx?afid=301

Key Data

* Mobile subscription growth continued in 2012 and Q113, with the total up by 2.5% y-o-y to 10.07mn in Q113. Swisscom leads the market in terms of net additions in the 12 months to the end of March 2013.
* Following a more aggressive pricing strategy by Orange after investment by Apax, market leader Swisscom's Infinity tariffs have added to the competitive dynamic. These developments resulted in a minor downgrade to our forecast, and we now expect monthly blended ARPU will decline to CHF39.2 in 2013.

Key Trends And Developments

* Following the launch of commercial LTE services by Orange and Sunrise in June 2013, all three network operators in Switzerland were active in the 4G market. Swisscom was the first operator to launch commercial services in November 2012. Although there is a competitive LTE market in Switzerland, operators are only in the process of extending coverage, and as such there is not yet a nationwide competitive LTE market. Operators are investing significant sums and coverage is increasing rapidly, with Swisscom achieving 35% coverage by April 2013, and Orange targeting 71% population coverage by the end of 2013, while Sunrise is aiming for 50% population coverage by the end of October 2013.There is also major investment taking place in next generation fixed broadband networks. Most recently, in June 2013 Sunrise and Swiss Fibre Net (SFN) announced the formation of a strategic alliance to jointly develop alternative fibre-optic network (FTTH) services for the local market. This followed the February 2013 announcement that incumbent operator Swisscom selected equipment vendor Huawei Technologies to roll-out Fibre-To-The-Street (FTTS) networks in areas away from major urban centres. This is part of the operator's target to provide 80% of households in the country with high-speed broadband internet access by 2020.

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