4Q09 United Kingdom Mobile Operator Forecast, 2009 - 2013: Total wireless subscribers in the UK to reach 83.3 million in 2013 with Telefónica O2 taking a market share of 29.5%
IEMR’s Mobile Operator Forecast on the United Kingdom provides over 50 operational and financial metrics for the UK wireless market and is one of the best forecasts in the industry. We provide five-year forecasts at the operator level going out to 2013. We also provide quarterly historical and forecast data starting in 1Q2003 and ending in 2Q2011. Operators covered for the United Kingdom include: Vodafone Group Plc, Telefónica O2 UK Limited, Orange, T-Mobile (UK) Limited, and Hutchison 3G UK Limited. Our Mobile Operator Forecasts are updated quarterly and are available for one-time delivery or through regular updates.
IEMR’s Global Mobile Operator Forecast covers 50 operational metrics of 200+ mobile operators in 50+ countries, making up 80% of the world’s population. Our forecasts are based on our proprietary, country-specific forecasting models. These models deploy multiple regression analysis and cross-impact matrices that estimate relationships between subscriber data, technology use and deployment data, overall economic and demographic changes expected in a particular country; and relate these to company operational and financial metrics.
Executive Summary
Subscriber growth is slowing down gradually in the UK wireless market+3.7% industry average subscriber growth in 2Q.2009
ARPU levels are stabilizing in the United Kingdom-2.3% operator-wide average ARPU growth in 2Q.2009
Minutes of Use per Subscriber are increasing The industry average MOU/Sub growth of 0.5% in 2Q.2009
Negative EBITDA growth at Vodafone, Orange, and T-Mobile in the latest quarterThe industry average EBITDA growth of -7.1% in 2Q.2009
So what is IEMR’s Forecast?
Total wireless subscribers in the UK to reach 83.3 million in 2013
Our forecasting model predicts that total mobile subscriber accounts in the United Kingdom will increase from 76.4 million in 2008 to 83.3 million in 2013.
The actual data from 2008 indicates that Telefónica O2 UK has replaced Vodafone as the largest mobile operator in the UK during the second quarter of 2008. Our forecasting model predicts that Telefónica O2 UK will continue to serve more subscribers than Vodafone over the next five years.
We forecast that, by the end of 2013, Vodafone and Telefónica O2 UK will be serving 17.7 million and 24.5 million subscribers respectively.
Vodafone will be losing subscriber market share over the next five years
According to our forecasting model, Vodafone's share of total subscribers will decline from 25.1% in 2008 to 21.3% in 2013.
We also forecast that T-Mobile's market share will fall from 22.0% in 2008 to 18.9% in 2013.
In contrast, we predict that Telefónica O2 UK's subscriber market share will increase from 25.5% to 29.5%, Orange's market share will increase from 20.9% to 21.1%, and Hutchison 3G's market share will increase from 6.5% to 9.2% over the forecast period, 2008 - 2013.
ARPU levels in the United Kingdom to be stable from 2009 to 2013
Our model does not forecast significant changes in the ARPU levels over the forecast period, 2008 - 2013. The expected average ARPU level in the UK in 2013 is £22.13 per month.
We expect that Vodafone's monthly ARPU will decline from £21.78 in 2008 to £20.77 in 2013 while that of Telefónica O2 UK declines from £23.85 in 2008 to £22.51 in 2013.
Hutchison 3G which has the highest ARPU level in the country will also see its monthly ARPU decline from £28.72 in 2008 to £23.98 in 2013.
Vodafone's EBITDA margin will be declining over the forecast period, 2008 - 2013
We expect that the industry average level of profitability measured by EBITDA margin (calculated as EBITDA / reported revenue) will remain in the range of 21% - 23% over the next five years.
At the operator level, our model predicts that Vodafone's EBITDA margin will decrease from 23.7% in 2008 to 21.7% in 2013. Telefónica O2's EBITDA margin will also be decreasing over the next several years to reach 20.1% in 2013, according to our model.
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