Greece - Telecoms, IP Networks, Digital Media and Forecasts

Additional Information

Regulator permits OTE to relaunch retail and wholesale VDSLBuddeComm’s half-yearly publication Greece - Telecoms, IP Networks, Digital Media and Forecasts, provides a comprehensive overview of the trends and developments in the telecoms and digital media markets in Greece, including the regulator’s latest market data, operator data to the end of 2011 and market developments into 2012.

Economic conditions

Greece’s continuing period of economic difficulties provides little course for optimism. In return for two bailouts amounting to some €240 billion the government has been obliged to introduce a range of austerity measures, as well as sell many assets including a significant stake in the incumbent telco OTE. A recent debt sustainability report from the IMF, ECB and EC warned of a 160% GDP debt ratio by 2020 if Greece fails to deliver structural reforms including €3.3 billion in cuts for 2012 alone and further reductions in public sector jobs. Dwindling revenue from taxes as businesses fail effectively means that Greece has little chance of returning to growth in 2013, as the bailout providers hope. Indeed, new debt issued by the government in 2014/2015 depends on economic recovery, and since creditors are unlikely to purchase Greek debt if the economy falters the government is likely to require an additional €50 billion bailout after 2014.

Telecom revenue overview

Greece’s telecoms market has been significantly affected by the contracting economy, with a number of operators posting falling revenue and increased borrowing costs. The market has contracted since 2008, exacerbated by retail competition which has driven prices down, and the effects of a number of regulator measures. The market has been buoyed by the broadband and nascent mobile data sector, though operators should look to tough times for two to three years at least.

Broadband market

Greece’s internet market is underdeveloped by EU standards, with relatively low penetration rates. In the absence of an effective competing cable broadband platform, broadband is dominated by DSL though LLU has in recent years steadily eroded the market dominance of OTE. Consumers can expect faster services from mid-2012 when OTE is able to re-launch its VDSL offers suspended in 2011 over wholesale pricing and access issues. Delays in building a national FttX network – initially aimed at delivering 100Mb/s services to 40% of the population by 2015 –prompted a number of telcos in 2011 to discuss a shared open access network incorporating some or all of the operators’ existing duct and cable infrastructure.

Mobile market

The mobile market is dominated by Cosmote, Vodafone and Wind Hellas. The bankruptcy of Wind Hellas and its re-emergence in early 2011 under the auspices of a holding company, encouraged Vodafone briefly to consider buying the operator. Wind is investing in network upgrades in a bid to rebuild its business viability. Thus far, take-up of mobile broadband and high-end data services has been slow though the recent auction of 900MHz and 1800MHz spectrum should provide a boost for LTE services in coming years.

Greece– Key telecom parameters – 2010; 2013Sector 2010 2013 (e)

Subscribers to telecoms services (million):

Fixed broadband 2.21 3.15
Mobile (SIM cards in service) 18.0 17.8
Mobile broadband 1.7 2.25
Fixed-line telephony 3.51 2.87

Market penetration by sector:

Fixed broadband 20% 26%
Fixed-line telephony 46% 41%
Mobile SIM (population) 118% 116%
(Source: BuddeComm)

Key Highlights

GSM licences due to expire were auctioned in early 2012 rather than offered for automatic renewal. The auction generated much needed revenue for the government, and will enable the three MNOs to pursue mobile broadband options in their bid to increase revenue in coming years.OTE’s suspended VDSL deployment has been cleared for re-launch from mid-2012 following the regulator’s decisions on access and wholesale pricing. The move will boost the availability of higher broadband data speeds for consumers, so helping Greece catch up with its European neighbours.The government’s national strategy for fibre access networks is aimed at building a nationwide open access FttH network providing 40% geographic coverage by the end of 2015 at an estimated cost of €2.1 billion (mostly derived from the private sector). Delays have pushed back delivery to 2018, while the regulator has since facilitated negotiations between six telcos to develop a cheaper national FttB network.This report is essential reading for those needing high level strategic information and objective analysis on the telecom sector in Greece.

It provides further information on:

Market liberalisation and regulatory issues;
The impact of the global economic crisis;
Telecoms operators – privatisation, acquisitions, new licences;
Mobile data market developments in coming years in light of spectrum auctions and new license awards in 2010;
3G developments, regulatory issues and technologies including HSPA and LTE;
Broadband migration to an FttH architecture;
Historical and current subscriber statistics and forecasts;
ARPU statistics and forecasts. Data in this report is the latest available at the time of preparation and may not be for the current year.