Stricken by the harsh economic crisis, the Romanian telecom market generated a mere RON15.7bn (US$5.1bn) in 2009, an 8.3% year-on-year decline in local currency terms. Over the next five years, we expect the Romanian telecom market to grow in local currency terms at a CAGR of 2.9% to RON18.0bn ($6.3bn). The fastest-growing segments will be VoIP, mobile data and fixed broadband , each of which will experience double-digit growth during the forecast period.
The new telecom regulator ANCOM is in the process of applying the European Commission (EC) telecom reform package, adopted in November 2009, to Romanian law: It has implemented the EU "900Mhz" Directive” to facilitate spectrum re-farming, launched public consultation on the “Internet as a Universal service” subject and lowered number portability fees. It has also proposed new, lower tariffs for access to Romtelecom’s network to facilitate the entry of alternative operators and mobile players, specifically Vodafone and Orange, into the fixed market. Despite these efforts, the EC has expressed concerns over the ANCOM’s independence.
The mobile market is the largest in Romania’s telecom service market, accounting for 63% of total revenue in 2009. The market’s 29.3m subscriptions give Romania a 137% penetration rate. Orange and Vodafone continue to dominate the market with a combined 70% of subscriptions. Cosmote acquired Zapp in 2009, gaining the 3G license that it was lacking — and thus the ability to provide advanced data services — as well as a presence in the postpaid and enterprise markets.
The fixed telecom market accounted for 37% of total telecom service revenue in 2009. Despite the anticipated fall in fixed-voice revenue, the fixed segment will grow at a local currency CAGR of 3.6% between 2009 and 2014, thanks to a steady growth of pay-TV revenue as well as sturdy 80% increase in broadband revenue. Bundling, which is already an important element of most operators’ commercial strategy, will become more important over the forecast period; by 2014, we expect 4m households in Romania to subscribe to a bundle of services.
The fixed broadband market has gotten a boost by growth in DSL and other technologies, in particular FTTB, while mobile broadband is also starting to gain traction in Romania. The introduction of prepaid options as well as the continued build out of 3G networks, will further drive adoption of mobile broadband over the forecast period.
Executive Summary
Market and Competitor Overview
Romania in a Regional Context
Economic, Demographic and Political Context
Regulatory Environment
Demand Profile
Service Evolution
Competitive Landscape
Major Market Players
Segment Analysis
Mobile Services
Fixed Services
Pay-TV
Convergence
Identifying Opportunities
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Author: Sylwia Boguszewska
Publication Date: May 2010
