Despite Downturn, Dutch Broadband Operators Up Their ARPS

May 11, 2009

Despite a competitive market and adverse economic conditions, broadband operators in the Netherlands continue to increase customer spend.

There is network level competition nationwide in broadband, because cable competes with DSL everywhere. Household broadband penetration is around 80%, one of the highest in Europe. All three mobile operators also offer 7.2Mbps nationwide mobile broadband, and T-Mobile will be able to offer 2Mbps HSPA uplink speeds all over the country by the end of 2009.

Our recent Netherlands country intelligence report also highlights that despite market consolidation, competition remains strong. Ziggo, the largest cable carrier, and KPN together have almost 70% of all broadband subscriptions. However, T-Mobile and Vodafone both have a small but growing presence in fixed broadband and are trying to attract customers away. Vodafone, for instance, is offering €5 off mobile contracts for those who subscribe to its DSL-voice bundle.

The country’s economy has also not avoided the global downturn; unemployment is expected to increase to almost 6% by the end of 2009, and average income is expected to decline by around 2%.

Despite these testing times, broadband service providers are enjoying increasing ARPS. The largest, KPN, reported that consumer broadband ARPS increased to €31 in the first quarter of 2009, up from €29 for the same period a year ago. Bundling and higher speeds are driving this trend: KPN reported that 2.06m of its 2.56m broadband subscribers have a double- or triple-play option (more than 60% of all access lines, up from 55% a year ago). KPN also owns 41% of Reggefiber, the leading fiber network, offering broadband speeds of up to 100Mbps, with monthly prices of up to €110.

UPC, the second largest cable operator, reported an increase in revenue despite a fall in the number of revenue generating units. Its FibrePower DOCSIS 3.0 network is now available to 1.1m homes, offering speeds of up to 120Mbps for which it charges €80.50 or 60Mpbs for €60.50. It also claims that half of its digital cable subscription base regularly uses their video on demand service, up from 40% in the first half of 2008.

— Jan ten Sythoff, Analyst at large

Related content:

Communications Markets in the Netherlands
Country Intelligence Report published May 2009
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Western Europe Media Forecasts, Q1 2009
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