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2008 European - Cable and Fibre Market

This report covers developments in Europe’s cable and fibre broadband markets

The countries covered in this report include: Albania, Austria, Belarus, Belgium, Bosnia-Herzegovina, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Hungary, Iceland, Ireland, Italy, Latvia, Lithuania, Luxembourg, Macedonia (FYROM), Malta, Moldova, Montenegro, Netherlands, Norway, Poland, Portugal, Romania, Russia, Serbia, Slovakia, Slovenia, Spain, Sweden, Switzerland, Ukraine and United Kingdom.


EXECUTIVE SUMMARY

This report covers developments in Europe’s cable and fibre broadband markets. The cable sector, having lost broadband market share to DSL alternatives, has recently been revitalised by the continuing consolidation among operators, particularly in Germany, which has enabled them to invest in network upgrades. Using DOCSIS 3.0 technology, Virgin Media in the UK and UPC in its several European markets provide the fastest copper-based services available. Their plans to upgrade to a 200Mb/s service by 2012 will place them on a par with Europe’s FttH providers. Cable broadband also continues to enjoy popularity in Central Eastern Europe and the Baltic region where a handful of major players have emerged following merger and acquisition activity. Cable is also popular in Russia, Bulgaria and Romania. Most major cablecos have also launched triple play offerings.

Europe’s fibre market has out-performed cable and DSL in terms of growth since 2007, yet the region still lags behind Asia and the USA. Most of the growth in FttH is based in only a few countries, while more than half of all connections are managed by only five operators. The rest of the region lags far behind, and new-build activity - particularly in the ten new EU member states (Slovenia being the exception) - remains low. Yet stimulated by government policies and favourable regulatory regimes, new access network deployments are now centred on fibre. The financial factors which initially restricted deployments to densely populated areas will be partly overcome during the next few years as national governments and the EC allocate funds to improve broadband infrastructure. Regulated access models aimed at facilitating competition and reducing civil engineering costs will also result in faster growth in the fibre market. Within Eastern Europe significant FTTx networks have been deployed across the region, including Albania, Russia, Estonia and the Czech Republic. FTTx deployments have a bright future in the region in coming years given the lack of extensive fixed line infrastructure in many countries.

The countries covered in this report include: Albania, Austria, Belarus, Belgium, Bosnia-Herzegovina, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Hungary, Iceland, Ireland, Italy, Latvia, Lithuania, Luxembourg, Macedonia (FYROM), Malta, Moldova, Montenegro, Netherlands, Norway, Poland, Portugal, Romania, Russia, Serbia, Slovakia, Slovenia, Spain, Sweden, Switzerland, Ukraine and United Kingdom.

Key highlights:
France


France is among the top three countries in Europe for fibre deployment. Since 2005, central and municipal governments have been at the forefront in pushing a national fibre strategy. Much of the market’s success has been achieved by alternative operators, which in turn has stimulated France Telecom to adopt an aggressive fibre roll-out as well as promote equal network access among providers. The August 2008 Economic Modernisation Law (EML) included a number of provisions for network sharing, and forms a key component of France’s regulatory framework designed to achieve widespread fibre deployment. As a result, the major providers Numéricable, Orange and SFR have agreed to share fibre installations between themselves and open them to other operators. Given the regulatory provisions and operator co-operation, in coming years France will retain its position as a leading fibre nation both in terms of network deployment and in effective strategies.

The UK

The UK was comparatively slow to develop its fibre sector, but considerable changes are expected by 2012 as a newly adopted regulatory regime provides operators with guaranteed returns on investments, so stimulating the business case for developing network builds. BT’s NGN, providing hybrid VDSL / FttC to up to ten million households, is expected to be supplemented by up to one million households with FttH connections in a program costing up to £1.5 billion. The regulator’s approach of removing wholesale access regulatory barriers should stimulate fibre builds in coming years, and so propel the country to the forefront f fibre infrastructure in Europe.

The Netherlands

The Netherlands is one of Europe’s top markets for both cable and fibre. The incumbent KPN and its part-owned provider Reggefiber operate a wholesale access service through their joint venture Glashart. Some of the conditions required from the Dutch regulator and cartel authority include a guarantee that other telcos have non-discriminatory access to the network at a fixed wholesale rate. The Netherlands has also benefited from innovative municipal involvement in fibre roll-outs, particularly in Amsterdam and Rotterdam. The sector has also been characterised by the wide range of non-telco activity, including the direct involvement of construction companies, individuals digging their own trenches, real estate investors and pension funds. Given these collective efforts, The Netherlands has shown the rest of Europe than FttH can be developed through the initiative of players other than the major telcos and cabelcos.

Henry Lancaster
March 2009


Data in this report is the latest available at the time of preparation and may not be for the current year.

The following notes provide some background to our scenario forecasting methodology:

  • This report includes what we term scenario forecasts. By describing long-range scenarios we identify a band within which we expect market growth to occur. The associated text describes what we see as the most likely growth trend within this band.
  • The projections shown in the tables in this report are based on our own historical information, as well as on telecommunication sector statistics from official and non-official, national and international sources. We assume a possible deviation of 15-20% around this data.
  • All statistics for GDP, revenue, etc are shown in US$, in order to maintain consistency within and between markets. At the same time we acknowledge that this can introduce some irregularities.

1. FIBRE REGULATORY OVERVIEW
1.1 The need for fibre
1.1.1 Arguments for fibre
1.1.2 Supporting the triple play market
1.2 Regulating access
1.2.1 The EC’s strategy
1.2.1.1 Regulating municipalities
1.2.1.2 Regulating incumbents
1.3 Structural separation
1.3.1 Fibre networks
1.3.2 Regulating access
1.3.3 Operators’ strategy
1.4 Examples of open access
1.4.1 France
1.4.2 Sweden
1.4.3 The Netherlands
2. ALBANIA
2.1 Fibre-to-the-Home (FttH) networks
2.1.1 Albanian Fibre Backbone (AFB)
3. AUSTRIA
3.1 FttH networks
3.2 Cable modems
3.2.1 UPC Austria
4. BELARUS
4.1 Cable modems
5. BELGIUM
5.1 Cable modems
5.1.1 Telenet
5.1.2 UPC Broadband
5.1.3 Interkabel
5.2 FttH networks
5.2.1 Digital Metropolis Antwerp
6. BOSNIA-HERZEGOVINA
6.1 Overview
7. BULGARIA
7.1 Cable
7.2 FttH networks
8. CROATIA
8.1 Cable modems
8.2 FttH networks
9. CYPRUS
9.1 Cable broadband
9.2 FttH networks
10. CZECH REPUBLIC
10.1 Cable modems
10.2 FttH networks
11. DENMARK
11.1 Cable modems
11.2 FttH networks
11.2.1 Community networks
12. ESTONIA
12.1 Cable modems
12.2 FttH networks
13. FINLAND
13.1 Cable modems
13.2 FttH networks
14. FRANCE
14.1 Cable modems
14.1.1 Cable network agreements
14.1.2 Cable consolidation
14.1.3 Numéricable
14.1.4 UPC France
14.2 FttH networks
14.2.1 Regulatory issues
14.2.1.1 Legislation
14.2.2 Regional support
14.2.3 Local authorities
14.2.4 Fibre operators and projects
14.2.4.1 France Telecom
14.2.4.2 Iliad (Free)
14.2.4.3 SFR/neuf Cegetel
14.2.4.4 Numéricable
14.2.4.5 Municipal drive - Paris
14.2.4.6 Other municipal projects
14.2.4.7 The Pau Project
15. GERMANY
15.1 Cable modems
15.1.1 Cable market consolidation
15.1.2 Cable players
15.1.2.1 Kabel BW
15.1.2.2 Kabel Deutschland
15.1.2.3 Unitymedia
15.2 FttH networks
15.2.1 Deutsche Telekom
15.2.2 Other developments
15.2.2.1 Cologne
15.2.2.2 Hamburg
15.2.2.3 Schwerte
15.2.2.4 Munich
16. HUNGARY
16.1 Cable modems
16.2 FttH networks
17. ICELAND
17.1 FttH networks
17.1.1 Statstics
18. IRELAND
18.1 Cable modems
18.2 FttH networks
19. ITALY
19.1 Cable modems
19.2 FttH networks
19.2.1 Telecom Italia
19.2.2 FASTWEB
20. LATVIA
20.1 Cable modems
20.2 FttH networks
21. LITHUANIA
21.1 Cable modems
21.2 FttH networks
22. LUXEMBOURG
22.1 Cable modems
22.2 FttH networks
23. MACEDONIA (FYROM)
23.1 Overview
24. MALTA
24.1 Cable modems
25. MOLDOVA
25.1 Overview
26. MONTENEGRO
26.1 Overview
27. NETHERLANDS
27.1 Cable modems
27.1.1 Ziggo
27.1.2 UPC Nederland
27.2 FttH networks
27.2.1 Government support
27.2.1.1 Broadband Expert Group
27.2.1.1.1 FttH focus
27.2.1.2 Key findings and recommendations
27.2.2 Regulating fibre
27.2.3 Government, councils and telcos involved
27.2.3.1 Kenniswijk - Eindhoven Smart City Project
27.2.3.2 Nuenen and Helmond
27.2.3.3 Rotterdam
27.2.3.4 Amsterdam
27.2.3.5 Projects in
27.2.3.6 Ethernet-to-the-Home (EttH)
28. NORWAY
28.1 Cable modems
28.2 FttH networks
29. POLAND
29.1 Cable modems
29.2 FttH networks
30. PORTUGAL
30.1 Cable modems
30.2 FttH networks
31. ROMANIA
31.1 Cable modems
31.2 FttH networks
32. RUSSIA
32.1 Cable modems
32.2 FttH networks
33. SERBIA
33.1 Cable broadband
33.1.1 Kosovo
34. SLOVAKIA
34.1 Cable modems
34.2 FttH networks
35. SLOVENIA
35.1 Cable modems
35.2 FttH networks
36. SPAIN
36.1 Cable modems
36.1.1 Statstics
36.1.2 ONO
36.2 FttH networks
36.2.1 Regulatory issues
36.2.2 Telefónica
36.2.3 Asturcón network
36.2.4 22@Barcelona project
37. SWEDEN
37.1 Cable
37.1.1 Com Hem
37.2 FttH networks
37.2.1 Overview
37.2.2 TeliaSonera
37.2.3 Regulating dark fibre
37.2.4 Bredbandsbolaget
37.2.5 PiteEnergi
38. SWITZERLAND
38.1 Cable modems
38.1.1 Cablecom
38.2 FttH networks
39. UKRAINE
39.1 Cable modems
39.2 FttH networks
40. UNITED KINGDOM
40.1 Cable modems
40.2 FttH networks
40.2.1 Costing fibre
40.2.2 Fibre access and Community Broadband Access networks
40.2.3 BT
40.2.4 Other developments
41. GLOSSARY OF ABBREVIATIONS


LIST OF TABLES


Table 1 - Free projections - Paris fibre − 2006; 2008; 2010; 2012; 2014
Table 2 - Forecast fibre subscribers - weaker and stronger scenarios in the Netherlands − 2008 - 2011; 2017
Table 3 - Fibre broadband subscribers in Austria - 2007 - 2008
Table 4 - UPC Austria broadband subscribers - 2005 - 2007
Table 5 - UPC Austria revenue - 2005 - 2007
Table 6 - Cable modem subscribers in Belgium - 2000 - 2008
Table 7 - Telenet broadband subscribers - 2002 - 2008
Table 8 - Telenet subscribers by sector - 2008
Table 9 - UPC Belgium subscriber data (historic) - 2006
Table 10 - FttH subscribers in Bulgaria - 2007
Table 11 - Cable subscribers in Cyprus - 2007
Table 12 - Broadband subscribers by access type in the Czech Republic - 2007
Table 13 - Cable broadband market shares by operator in Denmark - 2004 - 2007
Table 14 - Market share of cable broadband by data speed in Denmark - 2006 - 2007
Table 15 - Fibre broadband subscribers in Denmark - 2005 - 2008
Table 16 - Broadband coverage by technology in Denmark - 2001; 2003; 2007
Table 17 - Broadband subscribers by alternative technologies in Denmark - 2005 - 2007
Table 18 - Broadband subscribers by access type in Estonia - 2007
Table 19 - Cable modem subscribers in France - 2000 - 2008
Table 20 - Numéricable subscribers by type - 2007 - 2008
Table 21 - UPC France operating data (historic) - 2005
Table 22 - France Telecom fibre subscribers - 2006 - 2008
Table 23 - Free projections - Paris fibre − 2006; 2008; 2010; 2012; 2014
Table 24 - Cable subscribers in Germany - 2000 - 2008
Table 25 - Kabel BW subscribers - 2007 - 2008
Table 26 - Kabel Deutschland financial data - 2007 - 2008
Table 27 - Kabel Deutschland subscribers and annual change - June 2008
Table 28 - Unitymedia subscribers - 2006 - 2008
Table 29 - Unitymedia financial data - 2006 - 2008
Table 30 - T-Kabel broadband subscribers - 2004 - 2007
Table 31 - FttH subscribers in Hungary - 2007
Table 32 - Total broadband subscribers and penetration rate in Iceland - 2001 - 2007
Table 33 - Broadband penetration by access type in Iceland - 2004 - 2008
Table 34 - Fibre subscribers in Iceland - 2005 - 2007
Table 35 - UPC Ireland subscribers - 2005 - 2008
Table 36 - UPC Ireland subscribers - 2007 - 2008
Table 37 - Fibre accesses in Italy - 2004 - 2008
Table 38 - Telecom Italia fibre accesses - 2007 - 2010
Table 39 - Telecom Italia fibre cabinet network - 2008 - 2010
Table 40 - FttH subscribers in Latvia - 2007
Table 41 - Broadband subscribers by access type in Lithuania - 2007
Table 42 - FttH subscribers in Luxembourg - January 2008
Table 43 - Cable broadband penetration in Malta - 2000 - 2008
Table 44 - Broadband subscribers by access type and penetration rate in Moldova - 2001 - 2007
Table 45 - Cable modem subscribers in the Netherlands - 2000 - 2008
Table 46 - Ziggo financial data - 2006 - 2007
Table 47 - Ziggo operating and subscriber data - 2006 - 2007
Table 48 - UPC Nederland subscribers - 2005 - 2008
Table 49 - Total broadband subscribers (cable modem, xDSL, fibre) in the Netherlands - 1999 - 2008
Table 50 - FttH connections and subscribers in the Netherlands - 2006 - 2008
Table 51 - Planned FttH connections in the Netherlands - 2007 - 2011
Table 52 - Cable subscribers in Norway - 1999 - 2008
Table 53 - Get subscribers and operating statistics (historic) - 2005 - 2006
Table 54 - Fibre subscribers in Norway - 2005 - 2008
Table 55 - ZON Multimédia cable broadband subscribers - 2004 - 2008
Table 56 - Cable subscriptions in Serbia - 2004 - 2007
Table 57 - FttH subscribers in Slovakia - 2007
Table 58 - Broadband subscribers by access type in Slovenia - 2007
Table 59 - Cable modem subscribers in Spain - 2000 - 2009
Table 60 - Share of cable accesses in Spain - 2005 - 2008
Table 61 - Cable subscribers by operator in Spain - 2007 - 2008
Table 62 - Share of cable broadband revenue in Spain - 2007
Table 63 - ONO financial data - 2006 - 2008
Table 64 - ONO cable subscribers - 2005 - 2008
Table 65 - ONO subscribers by sector - 2005 - 2008
Table 66 - ONO broadband monthly ARPU - 2006 - 2008
Table 67 - Cable broadband subscribers in Sweden - 2000 - 2008
Table 68 - Com Hem subscriber statistics - 2005 - 2008
Table 69 - Com Hem financial data - 2007 - 2008
Table 70 - Fibre connections in Sweden - June 2008
Table 71 - Bredbandsbolaget subscribers by sector - 2004 - 2008
Table 72 - Bredbandsbolaget financial data - 2006 - 2008
Table 73 - Cablecom operational data: home and subscriber statistics - 2005 - 2008
Table 74 - Virgin Media subscribers by sector - 2007 - 2008
Table 75 - Virgin Media ARPU - 2007 - 2008
Table 76 - Virgin Media broadband subscribers by speed of service - 2007 - 2008


LIST OF EXHIBITS


Exhibit 1 - Structural separation developments - 2009
Exhibit 2 - Overview of FttH and FttB
Exhibit 3 - Plan of action and targets in the Netherlands - 2003 - 2015
Exhibit 4 - Estimated cost of fibre by deployment technology in the UK - 2008

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