Romania: Competition Among The Four Largest Operators Is Set To Intensify As The Market Moves To Con

From: Fast Market Research, Inc.
Published: Mon Feb 15 2016

In 2015, Romania will be the fourth-largest telecom services market in Central and Eastern Europe - after Russia, Poland and Czech Republic - with estimated revenue of $3.1bn (RON 12.3bn), or 1.7% of nominal GDP. Revenue growth between 2014 and 2015 is estimated at 0.5% in local currency, mostly driven by mobile data and pay-TV services.
Pyramid Research forecasts a service revenue CAGR of 0.3% between 2015 and 2020 in local currency in Romania (1.8% CAGR in $ due to currency appreciation). Fixed revenue will continue to decline through to 2020 thus offsetting the projected growth in mobile and pay-TV revenue. Total service revenue will stand at $3.4bn (RON12.5bn) in Romania in 2020 and mobile services will continue to dominate over fixed services with a 64% share of total revenue at the end of the forecast period. The major driver of revenue growth will be the customer migration to fiber, VDSL and LTE networks, along with the adoption of triple or quad-play offers

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Key Findings

* Continuous 4G service adoption and the development of the M2M market will offer a significant opportunity to win market share. MVNOs entered the market in 2015 and could increase price competition and gain market share over the next years.
* Fixed circuit switched revenue will fall at CAGR of 23.0% in local currency during 2015-2020, due to further fixed to mobile traffic substitution and the ongoing line migration to VoIP services. In 2017, revenues from VoIP services are expected to overtake circuit-switched revenues and reach RON 542m ($146m) in 2020, claiming 75% of the market fixed voice revenue - thanks to the upgrade of PSTN telephony to VoIP standards, as planned for completion by the incumbent Telekom Romania by 2018.
* Adoption of 3G technologies is at 55.3% of the mobile subscription base in 2015; Pyramid Research projects this will decline in the forecast period to 41.7%, due to gradual switch to 4G. LTE subscriptions will reach 12.4m by year-end 2020, 46.4% of total mobile subscriptions in Romania. The growth is driven by operator investment in 4G and the increasing demand for fast mobile broadband Internet and modern smartphones.
* The number of fixed broadband lines will grow from 4.4m in 2015 to 5.1m in 2020 and FTTH/B will account for the largest share of net additions through 2020. Romania aims to achieve 100% broadband household coverage at 30Mbps download speed by 2020 and 50% of households having access to broadband services of over 100Mbps download speed.

Report Synopsis

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