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Estonia - Telecoms, IP Networks, Digital Media and Forecasts

Strong investment in LTE resulting in huge mobile broadband growth

BuddeComm’s annual publication, Estonia - Telecoms, IP Networks, Digital Media and Forecasts, provides a comprehensive overview of the trends and developments in the telecommunications and digital media sectors of one of Europe’s smaller and most innovative markets. The report includes operator data to end-2012; Statistics Estonia data to end-2011 and 2012 updates; regulator’s 2011 market data report; ETSA’s 2012 annual report; market developments to April 2013.

Economic background

The Estonian economy has undergone two sets of reforms in recent years. The main objectives of economic reform were reducing inflation, establishing stability in the country’s exchange rate and securing international investment. The economy showed considerable growth through the 1990s and into the new century, with GDP growth reaching 10.6% in 2006. However, GDP contracted by 5.1% in 2008 and 13.9% in 2009, mainly due to the collapse in demand for exported goods. However, a second tranch of regulatory measures and fiscal tightening since 2008 led to solid economic recovery, with GDP growth of 7.6% in 2011, though this was expected to have fallen to 2.4% for 2012. At the beginning of 2011 the country adopted the troubled Euro (€) as its currency.

Telecom market overview

The Estonian telecoms market is one of the most developed in Eastern Europe, having been one of the first in the region to be open to competition. The broadband sector has one of the highest penetration levels in the region, with widespread broadband usage underpinning the emerging internet economy. Various e-commerce, e-government, e-education and e-health services are available and widely used. The country was the first in the world to enable citizens to vote using Mobiil-ID cards. The cable-TV market is well developed and hence CATV operators have been well-positioned to offer bundled services.

Mobile market

Mobile penetration is on a par with most Western European countries, and though the three MNOs offer effective competition the MVNO market is underdeveloped. The mature 3G networks have promoted strong growth in the use of mobile data services, which will develop further in coming years as MNOs concentrate their investment in LTE upgrades. National LTE network coverage is expected by the end of 2014.

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

Subscribers by sector (thousand):

Fixed broadband subscribers | 342 | 355
Mobile phone | 1,680 | 2,240
Fixed-line telephony | 480 | 455

Penetration by sector:

Fixed broadband | 29% | 34%
Mobile | 127% | 143%
Fixed-line | 45% | 43%
(Source: BuddeComm)

Market Highlights

Operators have been able to deploy LTE more cost-effectively in rural areas since Russia made available the 790-862MHz band that had previously been used by military air controllers.

EMT now has more than 50% of new mobile data subscribers taking up LTE services, compared to between 10% and 15% of new accesses in early 2012.

The government’s support of a nationwide 100Mb/s FttX should deliver 100Mb/s services nationally by 2015. The State’s contribution to the project in rural and underserved areas is proportionately among the more significant in the EU.

The gradual deployment of fibre has contributed to the steady decline in the number of DSL and cable broadband subscribers since 2011.

This report is essential reading for those needing high level strategic information and objective analysis on the telecom sector in Estonia.

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;
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.


1. Key Statistics
2. Telecommunications Market
2.1 Economic background
2.2 Overview of Estonia’s telecom market
3. Regulatory Environment
3.1 Background
3.1.1 EU Regulatory Framework
3.1.2 Revised NFR
3.2 Regulatory authority
3.3 Telecoms sector liberalisation in Estonia
3.3.1 Privatisation
3.3.2 Interconnect
3.3.3 Access
3.3.4 Carrier selection and Carrier PreSelection (CPS)
3.3.5 Number Portability (NP)
4. Fixed Network Operators
4.1 Overview of operators
4.2 Eesti Telekom (Elion)
4.2.1 Tele2 Eesti
5. Telecommunications Infrastructure
5.1 National telecom network
5.1.1 Elion
5.1.2 Alternative operators
5.2 Telecoms and IT
5.3 Wholesaling
6. Internet Market
6.1 Estonian Information Society Strategy 2013
6.1.1 Legislation
6.1.2 E-government
6.1.3 E-commerce
6.1.4 E-education
6.1.5 E-health
7. Broadband Market
7.1 Overview
7.1.1 Broadband statistics
7.2 Cable modems
7.3 Asymmetric Digital Subscriber Line (ADSL)
7.4 Fibre-to-the-Home (FttH) networks
7.5 Wireless broadband
7.5.1 WiFi
7.5.2 WiMAX
7.5.3 Mobile broadband
8. Digital Media
8.1 Overview of digital TV market
8.1.1 Digital TV
9. Mobile Communications
9.1 Overview of Estonia’s mobile market
9.1.1 Mobile statistics
9.2 Regulatory issues
9.2.1 Third Generation (3G) licences
9.2.2 Fourth Generation (4G) licences
9.2.3 Mobile Number Portability (MNP)
9.2.4 Mobile Termination Rates (MRT)
9.3 Mobile technologies
9.3.1 Digital
9.3.2 3G mobile
9.4 Major mobile operators
9.4.1 Eesti Mobiltelefon (EMT)
9.4.2 Radiolinja Eesti/Elisa
9.4.3 Tele2 Eesti
9.4.4 Mobile Virtual Network Operators (MVNOs)
9.5 Mobile voice services
9.5.1 Prepaid cards
9.6 Mobile data services
9.6.1 Short Message Service (SMS)
9.6.2 Multimedia Message Service (MMS)
9.6.3 General Packet Radio Service (GPRS)
9.6.4 Enhanced Data rates for GSM Evolution (EDGE)
9.6.5 High Speed Packet Access (HSPA)
9.6.6 Long-term Evolution (LTE)
9.6.7 Mobile TV
9.7 Mobile content and applications
9.7.1 Location-based services
9.7.2 M-commerce
10. Forecasts
10.1 Forecasts – broadband subscribers 2010-2013; 2020
10.1.1 Scenario 1 – higher broadband subscriber growth
10.1.2 Scenario 2 – lower broadband subscriber growth
Table 1 – Country statistics – 2012 (e)
Table 2 – Telephone network statistics – 2011
Table 3 – Internet user statistics – 2012 (e)
Table 4 – Broadband statistics – 2012 (e)
Table 5 – Mobile statistics – 2012 (e)
Table 6 – National telecommunications authority
Table 7 – ICT financial statistics – 2009 - 2013
Table 8 – Telecoms sector revenue – 2008 - 2013
Table 9 – Proportion of telecoms revenue by sector – 2011
Table 10 – Fixed number portings – 2008 - 2012
Table 11 – Eesti Telekom Group – revenue breakdown – 2005 - 2012
Table 12 – Eesti Telekom subscribers by sector – 2009 - 2012
Table 13 – Tele2 financial data by sector – 2007 - 2012
Table 14 - Tele2 financial data – 2008 - 2012
Table 15 – Tele2 subscribers by sector – 2007 - 2012
Table 16 – Fixed lines in service and teledensity – 1995 - 2012
Table 17 – Elion PSTN/ISDN outgoing call minutes – 2006 - 2012
Table 18 – Elion PSTN/ISDN subscribers – 2002 - 2012
Table 19 – Workplace network usage by network type – 2006 - 2011
Table 20 – Elion wholesale broadband subscribers – 2004 - 2012
Table 21 – Internet users and penetration rate – 1998 - 2013
Table 22 – Fixed-broadband subscribers and penetration rate – 2004 - 2013
Table 23 – Cable and DSL broadband subscribers – 2003 - 2013
Table 24 – Households with internet and broadband; penetration – 2005 - 2012
Table 25 – Elion fixed-broadband subscribers – 2006 - 2012
Table 26 – Elion fixed-broadband ARPU – 2006 - 2012
Table 27 – Proportion of broadband connections by data speed – 2010 - 2011
Table 28 – Mobile broadband subscribers – 2008 - 2013
Table 29 – TV access method – 2008 - 2011
Table 30 – Elion IPTV subscribers – 2006 - 2012
Table 31 – Viasat subscribers – 2005 - 2010
Table 32 – Mobile subscribers and penetration rate – 1998 - 2013
Table 33 – Mobile number portings – 2008 - 2012
Table 34 – EMT subscribers – 2005 - 2012
Table 35 – EMT ARPU – 2005 - 2012
Table 36 – EMT mobile financial data – 2009 - 2012
Table 37 – Elisa financial data – 2008 - 2012
Table 38 – Elisa subscribers – 2008 - 2012
Table 39 – Tele2 mobile financial data – 2008 - 2012
Table 40 – Tele2 mobile subscribers – 2007 - 2012
Table 41 – Ratio of prepaid to postpaid subscribers – 2000 - 2012
Table 42 – EMT prepaid subscribers – 2002 - 2012
Table 43 – Total SMS messages sent – 2004 - 2013
Table 44 – Total SMS messages sent – 2005 - 2013
Table 45 – Forecast broadband subscribers – higher market growth scenario – 2010 - 2013; 2020
Table 46 – Forecast broadband penetration – higher market growth scenario – 2010 - 2013; 2020
Table 47 – Forecast broadband subscribers – lower market growth scenario – 2010 - 2013; 2020
Table 48 – Forecast broadband penetration – lower market growth scenario – 2010 - 2013; 2020
Chart 1 – Eesti Telekom group – revenue breakdown – 2005 – 2012
Chart 2 – Fixed lines in service and teledensity – 2002 - 2012
Chart 3 – Internet users, subscribers and penetration rates – 2003 - 2013
Chart 4 – Fixed-broadband subscribers and penetration rate – 2004 - 2013
Chart 5 – Mobile subscribers and penetration rate – 2003 - 2013
Chart 6 – EMT financial data – 2009 - 2012
Chart 7 – Elisa financial data – 2008 - 2012
Chart 8 - Tele2 mobile financial data – 2008 - 2012
Chart 9 – Forecast broadband subscribers – higher market growth scenario – 2010 - 2013; 2020
Chart 10 – Forecast broadband subscribers – lower market growth scenario – 2010 - 2013; 2020
Exhibit 1 – The EU regulatory framework for communications
Exhibit 2 – Access, the local loop and unbundling – an overview

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