Luxembourg - Telecoms, IP Networks, Digital Media and Forecasts
Telecom revenue remains stable thanks to strong broadband sector
Luxembourg has one of the smallest telecom markets in Europe, greatly supported by an influx of workers and migrants from larger neighbouring countries. Luxembourg City is also one of the political centres of the European Union, and so attracts affluent migrant employees.
Overall revenue from electronic communications services bucked the downward trend seen in many other European markets, growing slightly in 2012 with similar growth anticipated into 2014. Much of this growth is due to the strong mobile services sector while revenue from fixed-line telephony continued to fall. Steady growth is expected during the next few years at least as the Duchy's upgraded network infrastructure attracts international interest from companies seeking high-end connectivity.
Total investment in fixed-line infrastructure has also risen steadily, and is expected to continue to do so for the next five year as operators migrate from copper to FttP and FttC. Equally, there is considerable investment in mobile networks to provide mobile broadband connectivity to subscribers based on HSPA and LTE technologies, though the amount invested in 2012 fell year-on-year.
Investment has been maintained in spite of the impact of the financial crisis and by the effects of Luxembourg's general economic slump, which saw GDP fall in 2009, largely due to the knock-on effects of the poor economic performances of the Duchy's neighbouring trading partners. Nevertheless, GDP per capita, at about US$116,000, provides one of the highest disposable incomes in Europe to maintain consumer spend on telecom services.
The incumbent POST Telecom (formerly P&T Luxembourg) remains the dominant player in all market sectors, despite the telecoms market having been liberalised in 1998. Regulatory measures during the last few years have encouraged broadband competition through local loop unbundling, yet the proportion of unbundled lines remains relatively low. As yet, there are few broadband subscribers on fibre networks but this is set to change as the country migrates to FttP architecture. POST Telecom has set aside 500 million to build its NGN, an open access platform which should allow for effective competition though high wholesale access prices may need to be addressed by the regulator.
In common with most other markets, revenue from the fixed line sector has been falling steadily. Indeed since 2005 income generated by mobile telecoms has far exceeded that from of fixed lines, while revenue from the broadband sector has propped up total revenue.
High mobile penetration has slowed subscriber growth in the mobile market since 2005. Partly as a result of fixed-mobile substitution, Luxembourg has one of the lowest fixed-line densities in Europe, at about 50%. As a consequence, revenue from the fixed line sector has been falling steadily as consumers migrate to mobile-only solutions. In 2005 income generated by mobile telecommunications exceeded those of fixed lines for the first time.
Luxembourg key penetration of telecom services 2014 (e) Sector | Penetration Fixed-line | Broadband | 33.2% Mobile (SIM): | 165% (Source: BuddeComm) Data in this report is the latest available at the time of preparation and may not be for the current year.
This report covers trends and developments in Luxembourg's telecommunications market. The report analyses the mobile, internet, broadband, digital TV and converging media sectors.
Market and industry analyses, trends and developments; Facts, figures and statistics; Industry and regulatory issues; Infrastructure; Major Players, Revenues, Subscribers; ARPU; Internet, VoIP, IPTV; Mobile Voice and Data Markets; Broadband (FttP, DSL, cable TV, wireless); Convergence and Digital Media; Broadband market forecasts for selective years to 2020.
POST Telecom reported stable revenue in 2013, reflecting the strength of its broadband and TV offerings; telecom regulator taken to court by the EC for failing to review the wholesale and retail markets; Tango and Vodafone extend co-operation agreement to 2017; Includes telcos' financial and operating data to Q3 2014, regulator's market data for 2013, recent market developments.
Companies covered in this report include:
POST Luxembourg, Cegecom, Tango, Telecom Luxembourg