Portugal - Telecoms, Mobile and Broadband - Statistics and Analyses

Portugal - Telecoms, Mobile and Broadband - Statistics and Analyses

EC opens infringement procedures against Portugal and other member states

Portugal has a medium-sized telecom market with a strong mobile sector and a growing broadband customer base. Before the Covid-19 pandemic, the country had seen improving economic growth, following several years of austerity measures. Revenue among some operators remains under pressure, though investments in network upgrades are continuing in an effort to attract customers to high-end services.

Portugal's broadband penetration has grown steadily in recent years, largely the result of joint efforts between the regulator and the key market operators which have invested in significant infrastructure upgrades. These operators are focussed on fibre-based services, resulting in a migration of subscribers from DSL infrastructure. Under the ownership of the Altice Group, Altice Portugal is focussed on FttP, aiming to have covered 5.3 million premises by the end of 2020, and providing national coverage.

The cable sector has also shifted towards fibre, with the principal cableco NOS investing in fibre rather than DOCSIS upgrades. In addition, Vodafone Portugal provides fibre to about two-thirds of premises. Much of the growth in the fibre segment has resulted from shared infrastructure deals, including that between Vodafone and NOS. The government has also supported two open-access wholesale networks being built by dstelecom and Fibroglobal.

The mobile market is dominated by the incumbent Altice Portugal, though it is seeing increasing competition from the other network operators, Vodafone Portugal and NOS. The MVNO market remains largely undeveloped, partly because network operators have their own low-cost brands. In July 2020, for example, NOS launched its sub-brand WOO. Collectively, MVNOs have about 2.9% share of the market.

Population coverage by 3G infrastructure is universal, and most investment in the sector is being directed to LTE and 5G technologies. The MNOs have trialled 5G and are looking to launch commercial services later in 2021.

This report introduces the major elements of the Portuguese telecom market, presenting statistics on the fixed telephony sector as well as an analysis of the major market players. Additional information is provided on the key regulatory issues, noting the status of interconnection, local loop unbundling, number portability and carrier preselection. The report also covers the fixed and fixed-wireless broadband markets, providing subscriber forecasts to 2026. In addition, the report profiles the mobile market, including statistics on network operators, a review of the key regulatory issues, a snapshot of the consumer market, and an analysis of mobile data services and technologies.

BuddeComm notes that the outbreak of the Coronavirus continues to have a significant impact on production and supply chains globally. During the coming year, the telecoms sector to various degrees is likely to experience a downturn in mobile device production, while it may also be difficult for network operators to manage workflows when maintaining and upgrading existing infrastructure. Overall progress towards 5G have been postponed or slowed down in some countries.

Lockdown measures have caused a surge in people working and learning from home and making use of online platforms for entertainment. Fixed networks have gained importance and data usage has soared. This situation is likely to continue into the future as companies allow more employees to work from home after the pandemic has passed. Although Portugal has one of the highest FttP coverage rates in Europe, investment in fibre infrastructure is continuing.

On the consumer side, spending on telecoms services and devices is under pressure from the financial effect of large-scale job losses and the consequent restriction on disposable incomes. However, the crucial nature of telecom services, both for general communication as well as a tool for home working, will offset such pressures. In many markets the net effect should be a steady though reduced increased in subscriber growth.

Although it is challenging to predict and interpret the long-term impacts of the crisis as it develops, these have been acknowledged in the industry forecasts contained in this report.

The report also covers the responses of the telecom operators as well as government agencies and regulators as they react to the crisis to ensure that citizens can continue to make optimum use of telecom services. This can be reflected in subsidy schemes and the promotion of tele-health and tele-education, among other solutions.

Key developments:

Bidding in 5G auction completed for new entrants;
EC opens infringement procedures against 24 EU member states for failing to enact the European Electronic Communications Code into national legislation;
Competition Authority fines MEO 84 million for anti-competitive behaviour;
Másmóvil becomes sole shareholder of Nowo;
Fixed broadband internet traffic up 53% in the third quarter of 2020, FttP accounting for 53.8% of fixed broadband accesses;
Vodafone and NOS sign a network-sharing agreement, NOS sells towers to Cellnex;
EU to investigate whether the regulator's draft 5G auction terms contain state aid;
Altice Portugal assesses feasibility of tender for the installation of the undersea cables between the mainland, the Azores and Madeira;
Equiano (Google) submarine cable due for completion later in 2021;
Portugal aims for 90% LTE coverage in rural areas by 2025;
Report update includes the regulator's market data to Q3 2020, telcos' operating and financial data to December 2020, assessment of the global impact of Covid-19 on the telecoms sector, recent market developments.

Companies mentioned in this report:

Altice Portugal (MEO), NOS (Optimus, Zon Multimédia), Vodafone Portugal, CTT, Lycamobile, Sonaecom, Cabovisão. Google, Másmóvil, Oni Communications, Nowo, RedCLARA