- Working groups
The continuous revenue decline in 2010 and 2011 for Europe’s telecoms sector despite overall timid economic growth confirms that structural rather than cyclical changes are shaping the sector, reveals the second ETNO Annual Economic Report published today.
ETNO second annual economic report
Revenue decline for the third year in a row calls for regulatory policy to create better conditions to maintain sector investment capability
BRUSSELS – The continuous revenue decline in 2010 and 2011 for Europe’s telecoms sector despite overall timid economic growth confirms that structural rather than cyclical changes are shaping the sector, reveals the second ETNO Annual Economic Report published today.
According to the report, jointly prepared with IDATE, total revenue in Europe’s telecoms sector decreased by 1.4% in 2010. Estimates for 2011 point to a decline by 2%. The revenue decline is mainly due to fixed line revenues which fell by 8%.
Despite revenue decline, investments increased in 2010 by 2.3% and 5% in 2011. This increase is mainly due to ETNO members’ investment efforts although their revenues declined more than the sector average. However, after several years of cuts in expenses, overall investments in the sector remain below pre-crisis level.
“The telecoms sector is faced with a revenue decline for the third year in a row, putting at risk its long term capacity to meet the investment challenges ahead and the achievement of the EU Digital Agenda. Investment, especially by ETNO members, continued to increase and the number of households with high speed broadband networks doubled. However, looking at the persistent decrease in revenues, we see a high risk in terms of future investment capacity. The sector is committed to doing its best but even with these best efforts, favorable and forward looking policies are required to allow operators to keep investing and developing new business models” says Luigi Gambardella, ETNO Executive Board Chairman.
“If revenue from mobile services now accounts from more than half of total sector revenue, its growth is very limited, as markets are becoming saturated, while revenues from fixed services continue to decrease steadily. Up to now, revenue from mobile data services compensates for the decline in mobile revenue but it is not the case for fixed services”, says Didier Pouillot, Head of Telecoms Economics Practice, IDATE.
Market data indicate that while broadband subscribers continued to increase sharply, the number of fixed telephone line subscribers is further decreasing. On the mobile markets, the rapid increase in mobile data usage compensates for the flat growth of mobile voice revenue.
Finally, data on broadband deployments show that 2013 targets of the Digital Agenda are well on track. 2020 high speed broadband targets will be achieved only through a mix of technologies and platforms as shown by the report. In 2010, deployment of FTTH/B and FTTx by ETNO members has increased by 33 and 55% respectively showing that these companies are playing a leading role in achieving the 2020 Digital Agenda goals.
Main findings for ETNO 2011 Economic Report:
For more information, please contact: Thierry Dieu, ETNO Acting Director/ Communications Manager Tel: (32-2) 219 32 42 Fax: (32-2) 219 64 12 E-mail: email@example.com
ETNO’s 40 member companies and 10 observers from Europe and beyond represent a significant part of total ICT activity in Europe. They account for an aggregate annual turnover of more than €600 billion and employ over 1.6 million people. ETNO companies are the main drivers of broadband and are committed to its continual growth in Europe.
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