Serbia - Telecoms, IP Networks, Digital Media and Forecasts
Spectrum auction in February 2015 encouraging for mid-year LTE launch
Following an economically and politically turbulent period during the 1990s, Serbia started the first decade of the new millennium with strong GDP growth until the economic crisis of 2008 restricted both growth and investment. GDP growth soon recovered but it has been stymied by the poor performance of Serbia's neighbouring markets including Italy and Greece.
Economic difficulties prompted the government to adopt a range of fiscal measures to raise revenue, including a short-term imposition of a 10% tax on telecom services. Similarly, the economic difficulties, compounded by a range of regulatory measures, has seen a steady fall in telecom market revenue suffered due to the recent adverse economic conditions although not all markets were affected equally.
Serbia's potential integration with the European Union (EU), formalised by the Stabilisation and Association Agreement in 2008, has encouraged the government and regulator to adopted measures aimed at promoting telecoms reform. The Agreement oversees closer integration with the EU and covers commitments to political, economic, trade, or human rights reform. In addition, as part of the EU pre-accession process, Serbia has received financial aid to build public institutions and improve cross-border co-operation.
EU reforms have been fundamental to Serbia's telecom industry. The EU's regulatory framework for communications (the NRF), adopted in mid-2010, promotes competition as the most efficient way to offer communications products and services while ensuring universal access. However, the May 2012 election of a new government less inclined to compromise with EU, though still committed to joining the Union, may have implications for telecom sector regulatory measures.
Considerable network investment has been undertaken by incumbent and alternative operators in recent years, despite economic difficulties. This has helped to stimulate internet usage, which has also been bolstered by improved affordability as prices are reduced through competition.
Serbia boasts an extensive broadcasting market, with programming available via radio and TV programme distribution via cable, wireless cable, terrestrial free-to-air and broadband TV. An analogue switch off (ASO) plan has been adopted and digital TV is widely available on cable networks.
Serbia's high mobile penetration, the result of multiple SIM card use, has seen lower revenue in recent years, placing further pressure on operators to develop business models which encourage consumer use of mobile data services as also the continued substitution of fixed-line for mobile voice calls.
Serbia - Key telecom parameters 2014 (e)
Service | Penetration
Fixed-line | 40%
Broadband | 20%
Mobile penetration | 130%
The auction of spectrum in the 1800MHz band in February 2015 will stimulate the commercial launch of LTE services by mid-year.
Mid-2014 amendments to the Law on Electronic Communications stipulated the minimum set of Universal Service provisions. Several operators were designated as coming under US obligations. It also made greater emphasis on network neutrality.
Despite the government's buy-out of OTE's stake in the incumbent Telekom Serbia, there has been little interest from other players. The government expects to make a decision on the way to proceed with the process by mid-2015.
DSL still accounts for the majority of fixed broadband subscriptions. Fibre developments remain nascent, and so the onus is on the regulator to develop an appropriate access regime sympathetic to investment.
The investment firm acquired United Group in early 2014, including Serbia's SBB telecom and pay-TV provider.
From September 2014 simulcast analogue and digital TV broadcasting has been in force as Serbia continues with ASO, scheduled to be complete in mid-2015.
Data in this report is the latest available at the time of preparation and may not be for the current year.
This report provides a comprehensive overview of trends and developments in Serbia'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;
Major players, revenues, subscribers, ARPU, MoU;
Internet, VoIP, IPTV;
Mobile voice and data markets;
Broadband (FttP, DSL, cable TV, wireless);
Convergence and digital media;
3G subscriber and mobile ARPU forecasts to 2015;
Broadband market forecasts for selective years to 2020.
Regulator licences three MNOs for spectrum in the 1800MHz band; fixed-number portability introduced; simulcast analogue and digital TV broadcasts begin; KKR completes takeover of United Group; report update includes the regulator's market report for 2013, telcos' operating and financial data to Q4 2014; recent market developments.
Companies covered in this report include:
Mobilna Telefonija Srbija (MTS), Telekom Serbia, VIP Mobile, Telenor Serbia, Serbia Broadband (SBB)
This report is essential reading for those needing high level strategic information and objective analysis on the telecom sector in Serbia.
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 FttP architecture;
Historical and current subscriber statistics and forecasts;
ARPU statistics and forecasts.