The Norwegian Electronic Communication Service Market

Transcription

1 The Norwegian Electronic Communication Service Market First half October 2015

2 Contents 1 Introduction Development trends Telephony Fied and mobile broadband Total revenues Fied telephony Subscriptions Traffic Sales revenues Market shares Mobile services Introduction Subscriptions Traffic Minutes Messages Data traffic Sales revenues Mobile telephony Mobile broadband Combined sales revenues from mobile telephony and mobile broadband Market shares Mobile telephony Mobile broadband Mobile telephony and mobile broadband combined International roaming About international roaming Norwegian subscribers abroad Foreign subscribers in Norway Machine-to-machine communication Fied broadband Introduction Subscriptions Marketed line speed

3 5.3 Sales revenues Market shares Transmission of TV signals Introduction Subscriptions Sales revenues The sales concept Developments in sales revenues Market shares Appendi: Operative providers of telephony and broadband at 30 June List of figures Figure 1 Development in the number of subscriptions for fied telephony and mobile telephony. Residential and business subscriptions Figure 2 Annual changes in number of fied telephony and mobile telephony subscriptions. Residential and business subscriptions Figure 3 Development in traffic from the fied network and mobile networks Figure 4 Average number of traffic minutes per subscription per month from fied-line telephones and mobile phones Figure 5 Development in the number of subscriptions for fied and mobile broadband. Residential and business subscriptions Figure 6 Spread of fied broadband and VoIP among households Figure 7 Number of subscriptions broken down by access technology. Residential and business subscriptions Figure 8 Annual change in fied broadband subscriptions broken down into DSL, cable TV network and fibre. Annual change in mobile broadband subscriptions. Residential and business subscriptions Figure 9 Total sales revenues. Residential and business subscriptions combined. NOK million Figure 10 Share of the total sales revenues for the largest providers Figure 11 Number of subscriptions broken down into PSTN/ISDN and VoIP Figure 12 Share of households in Norway with a fied telephony subscription Figure 13 Development in traffic minutes from fied telephones

4 Figure 14 Voice traffic from fied-line telephones broken down by direction. Million minutes.. 21 Figure 15 Fied telephony sales in the business market for different traffic directions and subscriptions. NOK million Figure 16 Telenor's share of traffic minutes and total sales revenues. Business and residential markets Figure 17 Fied telephony, market share by revenues, residential and business markets Figure 18 Fied telephony, market share by traffic minutes, residential and business markets Figure 19 Broadband telephony, market share by sales revenues, residential and business markets Figure 20 Broadband telephony, market share by traffic minutes, residential and business markets Figure 21 Number of subscriptions for mobile telephony Figure 22 Number of mobile telephony subscriptions that are active for mobile data. Number of subscriptions that include 1 GB and 5 GB or more per month Figure 23 Number of special subscriptions for mobile broadband Figure 24 Traffic minutes from mobile phones, broken down by direction of traffic Figure 25 Number of SMS messages sent Figure 26 Number of MMS messages sent Figure 27 Number of content messages sent Figure 28 Development in data traffic for mobile telephony subscriptions and special subscriptions for mobile broadband Figure 29 Average monthly data volume per mobile broadband subscription Figure 30 Mobile telephony sales revenues Figure 31 Sales revenues from special subscriptions for mobile broadband broken down into residential subscriptions and business subscriptions Figure 32 Market shares for mobile telephony subscriptions Figure 33 Mobile telephony subscriptions broken down into residential and business customers Figure 34 Market shares for special subscriptions for mobile broadband Figure 35 Market shares for total data traffic for mobile telephony and mobile broadband Figure 36 Market shares for the combined sales revenues from mobile telephony and mobile broadband Figure 37 Development in traffic volumes. Norwegian subscribers abroad Figure 38 Development in earnings and costs. Norwegian subscribers abroad Figure 39 Development in traffic volumes. Foreign subscribers in Norway Figure 40 Development in earnings. Foreign subscribers in Norway Figure 41 Number of SIM cards for machine-to-machine communication (M2M) Figure 42 Number of subscriptions for fied broadband. Business market Figure 43 Number of subscriptions for fied broadband. Business market

5 Figure 44 Subscriptions for fied broadband broken down by line speed. Residential and business markets. All forms of access Figure 45 Subscriptions for fied broadband broken down by line speed. Residential customers. Downstream speed Figure 46 Subscriptions for fied broadband broken down by line speed. Residential customers. Upstream speed Figure 47 Subscriptions for fied broadband broken down by line speed. Business customers. Downstream speed Figure 48 Subscriptions for fied broadband broken down by line speed. Business customers. Upstream speed Figure 49 Fied broadband sales. Business market Figure 50 Fied broadband sales. Business market Figure 51 Fied broadband sales. Residential and business markets Figure 52 Market shares for mobile broadband measured by number of subscriptions. Residential market Figure 53 Market shares for fied broadband measured by sales revenues. Residential market Figure 54 Market shares for broadband measured by sales revenues. Business market Figure 55 Market shares for fied broadband via DSL, measured by sales revenues. Residential and business markets Figure 56 Market shares for fied broadband via cable TV network, measured by sales revenues. Residential and business markets Figure 57 Market shares for fied broadband via fibre, measured by sales revenues. Residential and business markets Figure 58 Number of subscriptions for reception of TV signals at the end of the period Figure 59 Number of TV subscriptions broken down by form of access. Percentage breakdown Figure 60 Sales revenues from distribution of TV signals broken down by form of access Figure 61 Market shares for distribution of TV signals, measured by number of subscriptions. All forms of access Figure 62 Market shares for transmission of TV signals, measured by number of subscriptions. Cable TV Figure 63 Market shares for transmission of TV signals, measured by number of subscriptions. Fibre Tables Table 1 Development in the number of providers in the electronic communications market, broken down by service category

6 Table 2 Number of PSTN, ISDN and broadband telephony (VoIP) subscriptions in the residential market Table 3 Number of PSTN, ISDN and broadband telephony (VoIP) subscriptions in the business market Table 4 Number of call minutes from fied-line telephones broken down into residential and business. Million minutes Table 5 Calls from fied network to fied network, mobile network and abroad. Residential market. Million minutes Table 6 Calls from fied network to fied network, mobile network and abroad. Business market. Million minutes Table 7 Fied telephony sales in the residential market and the business market. NOK million Table 8 Sales revenues per minute for fied telephony Table 9 Development in data traffic for mobile telephony subscriptions and special subscriptions for mobile broadband. Figures in 1,000 GB Table 10 Sales revenues from mobile telephony and mobile broadband. NOK million Table 11 Market shares for mobile telephony measured by service category. First half of Table 12 Traffic and sales revenues from machine-to-machine communication. Figures in millions

7 Key figures Fied telephony: Change Total number of subscribers to fied telephony 1,157,071 1,029, % Of which number of subscriptions for PSTN, ISDN 723, , % Of which number of subscriptions for VoIP 433, , % Traffic from fied-line telephones (million minutes) 1,731. 1, % Fied telephony sales revenues (NOK million) 1,780. 1, % Mobile services: Number of subscriptions for mobile telephony 5,845,423 5,841, % Number of special subscriptions for mobile broadband 554, , % Number of SIM cards for M2M communication 1,031,464 1,148, % Voice calls from mobile phones (million minutes) 6,790 7, % Number of SMS messages sent (millions) 3,014 3, % Number of MMS messages sent (millions) % Data traffic from mobile phones and mobile broadband (million GB) % Sales revenues from mobile services (million minutes) 8,720 9, % Fied broadband: Number of subscriptions for fied broadband. 1,936,488 2,002, % Of which number of subscriptions based on DSL 762, , % Of which number of subscriptions based on cable TV network 597, , % Of which number of subscriptions based on fibre 534, , % Of which number of subscriptions based on other technologies 41,786 44, % Fied broadband sales revenues (NOK million) 4,082 4, % TOTAL SALES REVENUES Total sales revenues from electronic communications services (NOK million) Transmission of TV signals: 14,595 14, % Number of subscriptions 2,215,070 2,225, % Sales revenues from transmission of TV signals (NOK million) 4,091 4, % 7

8 1 Introduction Twice a year, the (Nkom) presents statistics showing key developments in the markets for electronic communications services. The reports are based on figures obtained from all the providers of electronic communications services. One report covers statistics for entire years and is published in May every year, and the other report covers the first half of the year and is published in October each year. The statistics in both the full-year and half-year reports include fied telephony (including broadband telephony), mobile telephony and other mobile services, broadband and transmission of TV signals. The full-year report also includes data communication services and transmission capacity (leased lines). The statistics mainly cover subscriptions and sales revenues, and traffic where relevant. The market shares of the largest providers are also described. Table 1 shows the total number of operative providers on which the annual statistics are based. The total number of providers has decreased almost every year since Nkom has collected data from 167 providers as of the first half of The annual decrease reflects changes in the market in this period, including mergers, acquisitions and disposals. There are also fewer newly established providers compared with previously. Each of the individual service areas sees bigger or smaller changes every year. The number of providers of fied telephony and mobile services declines, while there are more broadband providers. Most of the providers have operations in more than one service area. The appendi contains a list of the individual providers within telephony and broadband Fied telephony Of which VoIP Mobile telephony Mobile broadband Fied broadband Data communication services Leased lines Transmission of TV signals TOTAL Table 1 Development in the number of providers in the electronic communications market, broken down by service category 8

9 Some of the figures from previous years have been restated. Nkom carries out thorough quality control of the reports submitted by the providers. Sometimes, however, we do not uncover erroneous reports until we can compare data from several years. The numerical data in this report may therefore contain minor errors. 9

10 Subscriptions in thousands 2 Development trends 2.1 Telephony Figure 1 shows the development in the number of subscriptions for fied telephony and mobile telephony 1 from 2003 on. Fied telephony includes broadband telephony (VoIP) from 2003 (when this service was introduced) onwards. At the end of the first half of 2015 there were almost 1.03 million subscriptions for fied telephony and over 5.84 million subscriptions for mobile telephony Mobile telephony Fied telephony st half 2015 Figure 1 Development in the number of subscriptions for fied telephony and mobile telephony. Residential and business subscriptions There has been a decline in the number of fied telephony subscriptions each year since Up to 2008 the annual reduction was a good deal smaller than 100,000 subscriptions. Since 2009 the annual reduction has remained relatively stable at over 100,000 subscriptions. Figure 2 shows annual changes in the number of subscriptions for mobile telephony and fied telephony, measured at the end of every half year since Broadband telephony grew in prevalence until the end of 2009 when the number of subscriptions reached a peak of almost 516,000. Since then, the number of subscriptions for broadband telephony has fallen each year and constitutes just over 409,000 subscriptions at the end of the first half of Figure 1 also includes subscriptions for NMT (Nordisk Mobiltelefonsystem Nordic Mobile Telephony) for 2003 and NMT is also referred to as a first-generation (1G) automatic mobile telephony system. This network opened in Norway in 1981 and was partly closed in 2001 (NMT-900), with final closure at the end of 2004 (NMT- 450). 10

11 Number of subscriptions in thousands The number of subscriptions for mobile telephony rose sharply each year until The period saw large annual variations in growth. Since 2011 the annual growth has slowed down considerably compared with the previous years. In this contet subscriptions include post-paid subscriptions and pre-paid subscriptions, i.e. active pre-paid cards 2. The proportion of pre-paid cards has decreased significantly in the period from 2002, when prepaid cards constituted some 40 per cent of subscriptions. At the end of the first half of 2015, the share of pre-paid cards was about 22 per cent Mobile telephony Fied telephony Figure 2 Annual changes in number of fied telephony and mobile telephony subscriptions. Residential and business subscriptions Figure 3 shows the change in originated traffic measured in minutes. Traffic minutes originating from the fied network include both voice calls and traffic to dial-up Internet. Traffic to dial-up Internet has been negligible in the last few years. Total traffic from fied telephony and mobile telephony declined substantially until roughly Much of this was due to the decline in traffic to dial-up Internet. From 2008, the annual decline in the total number of traffic minutes has been smaller. Mobile traffic comprises a steadily growing share of the total traffic. In the first half of 2015, traffic from mobile telephones constituted nearly 84 per cent of total traffic, compared with roughly 47 per cent in Nkom regards a pre-paid card as a subscription when it is active, i.e. it has generated traffic on a mobile network in the last three months. 11

12 Number of minutes Million minutes % 80% 70% % 50% 40% 30% 20% Traffic from fied networks Traffic from mobile networks Share traffic from mobile networks Figure 3 Development in traffic from the fied network and mobile networks The rapid growth in traffic from mobile networks is due to an increase in the number of mobile subscriptions and the fact that each subscription is generating more traffic on average. Figure 4 shows that there has been an increase in the average number of traffic minutes per subscription for mobile telephony, but this growth is beginning to level off. There has been a substantial decline in fied telephony in the same period. The difference between the average number of traffic minutes per subscription from fied telephony and mobile telephony is getting smaller. In the first half of 2015, the gap was less than 24 minutes on average per month From mobile phone From fied-lines Figure 4 Average number of traffic minutes per subscription per month from fied-line telephones and mobile phones 12

13 Number of subscriptions in thousands 2.2 Fied and mobile broadband Figure 5 shows the development in subscriptions for fied and mobile broadband 3 from At the end of 2004, there were just over 670,000 subscriptions for fied broadband. By the end of the first half of 2015, the number of subscriptions had passed 2 million. Mobile broadband was introduced in At the end of the first half of 2015, the number of subscribers was just over 511,000, Fied broadband Mobile broadband st half 2015 Figure 5 Development in the number of subscriptions for fied and mobile broadband. Residential and business subscriptions Figure 6 shows the percentage of households in Norway with a fied broadband subscription and the share of broadband customers who also have VoIP 4. The share of households with fied broadband has been rising, and in 2014 and the first half of 2015 the share is at 78 per cent. The growth in the number of residential broadband subscriptions was thus larger than the increase in the number of households in the entire period to Until 2007, an increasing share of households with fied broadband also had VoIP. In 2007 and 2008 this share was roughly 35 per cent. Since 2008, this share has declined slightly, and 3 Dedicated mobile broadband not linked to a mobile telephony subscription. 4 Nkom uses figures from Statistics Norway (SSB) on the development in the number of private households in Norway. The number of households at the end of the first half of 2015 has been estimated by Nkom. In 2013, SSB changed its definition of "household". This led to an etraordinary increase in the number of households in In turn, this means that the percentage share of the number of households with broadband does not increase from 2012 to

14 Number of subscriptions in thousands at the end of the first half of 2015 some 20 per cent of households with broadband also had VoIP. 100% 80% 60% 40% 20% Share of households with broadband subscription Share of broadband subscribers with broadband telephony 0% Figure 6 Spread of fied broadband and VoIP among households Figure 7 shows the number of broadband subscriptions broken down by access technology. At the end of the first half of 2015, broadband based on DSL, cable TV networks or fibre accounts for almost all of the total number of subscriptions for fied broadband. The number of subscriptions for these three access technologies is levelling out. The numbers of subscriptions based on cable TV networks and on fibre are now almost equal DSL Cable-TV Fibre Mobile broadband 0 Figure 7 Number of subscriptions broken down by access technology. Residential and business subscriptions 14

15 Number of subscriptions in thousands Figure 8 shows the annual change in the numbers of subscriptions for each of these three access technologies and for mobile broadband. For a long time, fied broadband based on DSL reigned relatively supreme, and this technology is still the most common. There was strong annual growth in DSL subscriptions up until Since 2008 there has been an annual reduction in the number of DSL subscriptions. At the end of the first half of 2015 fied broadband via cable TV network is the second most prevalent access technology. Cable TV networks saw increasing annual growth until Since 2010 the annual growth has slowed off. From 2011 the annual growth for fibre-based subscriptions has been higher than the growth in subscriptions based on cable TV network. The first years after mobile broadband was introduced saw significant growth in the number of subscriptions. However, since 2013 there has been a decline in the number of subscriptions for mobile broadband only. At the end of the first half of 2015 there were more than 511,000 subscriptions for mobile broadband only. This corresponds to about 25 per cent of the total number of subscriptions for fied broadband. Additionally, a large majority of mobile users use mobile broadband through their ordinary mobile subscription DSL Cable-TV Fibre Mobile broadband Figure 8 Annual change in fied broadband subscriptions broken down into DSL, cable TV network and fibre. Annual change in mobile broadband subscriptions. Residential and business subscriptions 15

16 NOK million 2.3 Total revenues Figure 9 shows the development in end-user sales for fied telephony, mobile services and fied broadband 5. Mobile services include mobile broadband subscriptions, special subscriptions for mobile broadband and mobile-to-mobile communication (M2M). End-user sales revenues are the amount customers are invoiced for. This figure does not, however, cover earnings from distribution of TV signals since a large portion of this revenue is payment for content and does not therefore count as electronic communication services. Sales revenue from distribution of TV signals is described in more detail in section 6.3. The sales figures for mobile telephony do not include wholesale earnings from termination and international roaming (foreign mobile users in Norway). Nor are retail earnings from international roaming (Norwegian mobile users abroad) included. International roaming is described in more detail in section 4.6. Earnings from the sale or lease of mobile phones and other terminals or physical equipment are not generally included as end-user revenues. From the first half of 2014 to the first half of 2015, there was an increase in total sales of about NOK 363 million. By comparison, there was an increase of just over NOK 216 million from the first half of 2013 to the first half of Total sales in the first half of 2015 amounted to almost NOK 15 billion Mobile services Fied broadband Fied telephony Total Figure 9 Total sales revenues. Residential and business subscriptions combined. NOK million 5 Up until the first half of 2014, the figures for fied broadband include sales revenues from dial-up Internet. 16

17 Sales of mobile services amounted to about NOK 9.0 billion in the first half of 2015, accounting for about 60 per cent of the total revenues in the first half of Sales of mobile services were nearly 280 million higher in the first half of 2015 than in the first half of Sales of fied telephony amounted to just over NOK 1.6 billion in the first half of This is a decrease of about NOK 161 million, compared to the first half of Sales revenues from fied telephony accounted for about 11 per cent of the total revenues from end-user sales. Revenues from fied broadband sales rose by more than NOK 244 million from the first half of 2014 to the first half of 2015, to approimately NOK 4.3 billion. Fied broadband sales accounted for roughly 29 per cent of total sales revenues in the first half of Figure 10 shows the ten largest providers' shares of the combined sales revenues. Telenor had a 52.4 per cent share of total sales in the first half of In the first half of 2015, this share had risen to 53.4 per cent. TeliaSonera has the second largest share of total sales revenues. The market share for TeliaSonera is at 19.7 per cent in the first half of In the course of the first half of 2015, TeliaSonera took over Tele2's customers and the residential customers of Network Norway. Tele2 and Network Norway had a combined share of 9.5 per cent of total sales in the first half of Get and NetGenTel had market shares of 3.6 and 3.3 per cent of total end-user sales, respectively. Telenor 53.4 % TeliaSonera 19.7 % Network Norway 5.6 % Tele2 Get 3.9 % 3.6 % NetGenTel 3.3 % Others 20.1 % 0% 10% 20% 30% 40% 50% 60% Figure 10 Share of the total sales revenues for the largest providers 17

18 Number of subscriptions in thousands 3 Fied telephony In this report both traditional fied telephony (PSTN and ISDN) and broadband telephony (VoIP) are discussed as fied telephony. 3.1 Subscriptions Figure 11 shows the total number of fied telephony subscriptions from 2006 to the end of the first half of The number of subscriptions has been declining since The number of ISDN subscriptions rose until 2002, then started to decrease again. At the end of the first half of 2015 there were 1,029,268 fied telephony subscriptions in Norway. This is a decline of about 4.8 per cent since the end of Subscriptions for VoIP decreased by approimately 3,000, while the decline in PSTN and ISDN subscriptions totalled nearly 49, VoIP PSTN and ISDN Figure 11 Number of subscriptions broken down into PSTN/ISDN and VoIP Figure 12 shows the development in the number of households with fied telephony. At the end of the first half of 2015, just over a third of Norwegian households had a fied-line telephone. By contrast, at the end of 2012 nearly half of Norwegian households had a fiedline telephone. 18

19 78% 74% 70% 64% 59% 54% 48% 41% 35% 33% Figure 12 Share of households in Norway with a fied telephony subscription Tables 2 and 3 show the development in subscriptions for PSTN, ISDN and broadband telephony (VoIP) for the residential market and the business market, respectively. In the residential market, the greatest decline was in ISDN 2B+D, down nearly 20 per cent from the end of 2014 to the end of the first half of PSTN and VoIP have fallen by 5.9 and 1.1 per cent respectively in the same period. In the business market, the greatest decline was in ISDN 2B+D, down 11.6 per cent from the end of In total, there is a 5.6 per cent decline in the number of fied telephony subscriptions for businesses in the first half of PSTN 747, , , , , , ,964 ISDN 2B+D 141, ,698 97,319 76,144 58,696 45,561 36,487 VoIP 500, , , , , , ,562 Others 5,305 3, Total 1,395,261 1,293,481 1,196,269 1,087, , , ,019 Table 2 Number of PSTN, ISDN and broadband telephony (VoIP) subscriptions in the residential market 19

20 Million minutes PSTN 168, , , , , , ,537 ISDN 2B+D 180, , , , ,338 85,627 75,737 ISDN 30B+D 8,608 8,242 7,099 7,096 6,304 5,700 5,344 VoIP 15,186 24,181 25,684 29,296 33,025 34,032 35,631 Others Total 372, , , , , , ,249 Table 3 Number of PSTN, ISDN and broadband telephony (VoIP) subscriptions in the business market 3.2 Traffic Figure 13 shows the development in traffic minutes from fied telephones. There was a total of about 1.4 billion call minutes from fied telephones in the first half of By comparison, the same figure was 7.1 billion in the first half of In the first half of 2015 there were 19.4 per cent fewer call minutes than in the first half of Historically, PSTN and ISDN have had the greatest percentage decline. From the first half of 2014 to the first half of 2015, the decline in traffic from VoIP is 20.1 per cent and from PSTN and ISDN combined it is 21.6 percent in the residential market. In the business market, the decline in the same period is 8.1 and 20.0 per cent, respectively VoIP PSTN and ISDN Total Figure 13 Development in traffic minutes from fied telephones 20

21 Million minutes Figure 14 shows the development in traffic from fied telephony broken down by direction and market segment. The largest share is to fied networks, which in the first half of 2015 constituted 66 per cent of traffic in the residential market and 47 per cent of traffic in the business market. In the first half of 2015, traffic in the residential market is 21 per cent lower than in the first half of 2014, while in the business market there is an 18 per cent decline in the same period Fied network Mobile network International 0 Residential Business Figure 14 Voice traffic from fied-line telephones broken down by direction. Million minutes Table 4 shows a greater decline in traffic in the residential market than in the business market in recent years. Traffic from VoIP in the business market declines for the first time. From the first half of 2014 to the first half of 2015, traffic declined by 7.8 per cent, despite the number of subscribers growing in the same period. By comparison, traffic from fied broadband in the business market rose by 4.6 per cent from the first half of 2013 to the first half of Business market 1,736 1,503 1, Of which VoIP Business market 1,131 1, Of which VoIP Table 4 Number of call minutes from fied-line telephones broken down into residential and business. Million minutes 21

22 Tables 5 and 6 show traffic broken down by direction for the residential and business markets. In both markets, traffic to the fied network declined, while traffic to the mobile networks increased by a corresponding amount. Traffic to international end-points increases by one percentage point in both the residential and business markets, to 15 and 9 per cent respectively. Fied network Mobile networks Min. Share Min. Share Min. Share Min. Share Min. Share 1, % 1, % % % % % % % % % International % % % % % Total 1, % 1, % 1, % % % Table 5 Calls from fied network to fied network, mobile network and abroad. Residential market. Million minutes Min. Share Min. Share Min. Min. Share Min. Share Min. Fied network % % % % % Mobile networks % % % % % International 94 8 % 88 9 % 74 8 % 68 8 % 62 9 % Total 1, % 1, % % % % Table 6 Calls from fied network to fied network, mobile network and abroad. Business market. Million minutes 3.3 Sales revenues Figure 15 shows a steady decline in sales revenues from fied telephony over the past 10 years. Sales revenues from fied telephony amounted to NOK 1.6 billion in in the first half of 2015, a decline of NOK 9.1 per cent from the first half of Earnings from subscriptions and additional services are the largest category at about NOK 1.1 billion, a decrease of nearly 9 per cent from the first half of Sales revenue from all traffic is 9.5 per cent lower than in the first half of Earnings from subscriptions and additional services accounted for

23 NOK million per cent of the sales revenues in the first half of 2015, traffic to mobile phones accounted for about 14 per cent, traffic to the fied networks accounted for 12 per cent, and international traffic accounted for just under 6 per cent. Revenues from PSTN and ISDN amounted to just under 75 per cent of the sales revenues from fied telephony Subscriptions and other revenues To mobile networks To fied networks International Total Figure 15 Fied telephony sales in the business market for different traffic directions and subscriptions. NOK million Table 7 shows the sales revenues in the residential and business markets for fied telephony as a whole and for broadband telephony. The residential market as a whole saw a decline of 11.9 per cent from the first half of 2014 to the first half of 2015: 7.6 per cent for VoIP and 13.6 per cent for PSTN/ISDN. In the business market the decline was 5.2 per cent. Sales revenues from PSTN and ISDN in the business market were down by about 9.4 per cent compared with Revenue from broadband telephony in the business market rose by 17.3 per cent. 23

24 Residential market 1,466 1,247 1, Of which VoIP Business market 1,161 1, Of which VoIP Table 7 Fied telephony sales in the residential market and the business market. NOK million Table 8 shows total revenue per minute and traffic revenue per minute for fied telephony. Both total revenue per minute and traffic revenue per minute increase from the first half of Traffic revenue increases despite an increase in the share of revenue coming from subscription fees Traffic revenue per min Total revenue per min Table 8 Sales revenues per minute for fied telephony 3.4 Market shares The total sales revenues from fied telephony in the residential and the business markets amounted to NOK 1.54 billion in the first half of The total number of traffic minutes was 1.4 billion minutes in the first half of This is the basis for the calculation of the market shares in figure 16. Here the market shares are defined on the basis of sales of telephony services to end-users in the residential and business markets. Figure 16 shows Telenor's market shares of the total sales revenues and number of traffic minutes for the residential and business markets from 2006 to the first half of Telenor's share of total revenues declines from 68.0 per cent in 2014 to 67.9 per cent in the first half of 2015, while the share of traffic minutes declines from 57.8 per cent in 2014 to 56.2 per cent in the first half of

25 80% 70% 60% 50% 40% 30% 20% Telenor's share of total revenue Telenor's share of traffic minutes 10% 0% Figure 16 Telenor's share of traffic minutes and total sales revenues. Business and residential markets Figure 17 shows the providers' market shares of the sales revenues in the residential and business markets combined. Measured by sales revenues, Phonero is the second largest provider of fied telephony, with 7.3 per cent of the market. Ventelo was merged into Phonero from 1 January Phonero and Ventelo's market shares are combined for the first half of 2013 and the first half of NetGenTel is the third-largest provider of fied telephony, at 5.2 per cent. NetGenTel merged with Telio Telecom on 1 January NetGenTel and Telio's market shares are combined for the first half of 2013 and the first half of TeliaSonera has 4.5 per cent of the fied telephony market after the acquisition of Tele2 6. TeliaSonera and Tele2's market shares are combined for the first half of 2013 and the first half of TeliaSonera has sold the fied telephony customers from the acquisition of Tele2 to Phonect, which acquires the customers as of 31 October

26 Telenor 67.9 % Phonero 7.3 % NeGenTel TeliaSonera 5.2 % 4.5 % TDC 0.4 % Other 14.8 % 0% 10% 20% 30% 40% 50% 60% 70% 80% Figure 17 Fied telephony, market share by revenues, residential and business markets Figure 18 shows the providers' market shares of the traffic minutes in the residential and business markets combined. Telenor's market share increased by 0.1 percentage points from the first half of NetGenTel increased its market share by 1.5 percentage points to 12.4 per cent in the first half of TDC's market share declined from 7.0 per cent in the first half of 2014 to 7.3 per cent in the first half of Phonero's market share decreased by 0.5 percentage points from the first half of 2014 to the first half of Telenor 57.5 % NetGenTel 12.4 % TDC Phonero 7.3 % 5.8 % TeliaSonera 4.2 % Other 12.9 % 0% 10% 20% 30% 40% 50% 60% 70% Figure 18 Fied telephony, market share by traffic minutes, residential and business markets 26

27 Figure 19 shows that Telenor increases its share of the VoIP market measured by sales revenues, with an increase from 26.1 per cent in 2014 to 29.4 per cent in the first half of NetGenTel's share declined from 24.0 per cent in 2014 to 20.4 per cent in the first half of Lyse Fiber increased its market share to 7.1 per cent. Telenor 29.4 % NetGenTel 20.6 % Lyse Fiber Get Viken Fiber 7.1 % 6.5 % 6.4 % Other 30.1 % Figure 19 Broadband telephony, market share by sales revenues, residential and business markets 0% 5% 10% 15% 20% 25% 30% 35% Measured in traffic minutes, NetGenTel is the biggest VoIP provider. Telenor advances 1.2 percentage points to 25.8 per cent from the first half of 2014 to the first half of Get's market share increased to 6.8 per cent, while Phonect increased from 5.2 per cent to 5.5 per cent. NetGenTel 36.8 % Telenor 25.8 % Get Phonect Viken Fiber 3.5 % 6.8 % 5.5 % Other 21.6 % Figure 20 Broadband telephony, market share by traffic minutes, residential and business markets 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 27

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29 4 Mobile services 4.1 Introduction In this report mobile services consist of three main parts: Mobile telephony subscriptions are subscriptions that enable calls, SMS messaging and Internet access, etc. The statistics for mobile telephony include the number of subscriptions, voice traffic in minutes, the number of messages and data volume. They also include sales revenues from mobile telephony, broken down into subscription revenues and traffic revenues, among other things. In this report, mobile telephony subscriptions are counted as the total number of active pre-paid cards 7 and invoiced subscriptions. These days most post-paid mobile telephony subscriptions include a certain volume of traffic in the form of voice minutes, messages and data traffic. Mobile broadband only subscriptions can only be used for Internet access and data traffic. A separate subscription for mobile broadband is bought independently of a mobile telephony subscription 8. The statistics for mobile broadband cover the number of subscriptions, data volume and sales revenues. Machine-to-machine (M2M) communication using the mobile network. The statistics cover the number of SIM cards for this purpose and related revenues and traffic. Figures for sales revenues were obtained for the first time for 2009, whereas traffic volume figures started being collected in Subscriptions Figure 21 shows the change the number of mobile telephony subscriptions from 2006 and to the end of the first half of At the end of the first half of 2015 there were more than 5.84 million mobile telephony subscriptions. This is an increase of about 11,500 subscriptions since the end of From the end of 2013 to the end of 2014, there was an increase of nearly 45,500 subscriptions. The annual increase has been decreasing in the last three years and was significantly lower than was normal before. Recent years have seen a drop in the number of pre-paid cards. The number of prepaid cards was almost 1.28 million at the end of the first half of This is a decline of almost 39,000 compared with the end of From the end of 2013 to the end of 2014, there was a decline 7 In this report "pre-paid cards" refers to an active pre-paid subscription. Subscriptions are considered active when the account has been used in the last three months. 8 Subscribers often use a USB modem in connection with special subscriptions for mobile broadband. Subscribers may also use a PC card or a WiFi router connected to a mobile network. 9 One provider of mobile telephony has changed its previous reporting of the number of pre-paid cards. This applies to figures for entire years and half years in 2013 and The figures for the number of subscriptions in figure 21 therefore cannot be compared with previous reports. 29

30 Number of subscriptions in thousands of almost 45,000. The number of prepaid cards as a share of the total number of subscriptions has been weakly decreasing in recent years. At the end of the first half of 2015, this share was 21.9 per cent, while at the end of 2014 it was 22.6 per cent. By comparison, at the end of 2006 this share was above 32 per cent per cent of all mobile telephony subscriptions were registered to residential customers 10 at the end of the first half of This is the same as at the end of This share has been stable at this level for the past three years % % 40% 35% 30% 25% 20% 15% 10% 5% Pre-paid cards Post-paid subscriptions Total Share pre-paid cards (right ais) 0 0% Figure 21 Number of subscriptions for mobile telephony Nkom collects statistics on the number of mobile subscriptions that use mobile data. These are mobile subscriptions that have generated data traffic in the period 11. This can be considered an indicator of the prevalence of Internet use on mobile phones. This is shown in figure 22, with figures dating back to The number of subscriptions of this kind has increased significantly over the last three years. At the end of the first half of 2015 there were more than 4.26 million subscriptions that had generated mobile data. This constitutes just under 73 per cent of the total number of mobile telephony subscriptions. By comparison, the corresponding share was more than 68 per cent at the end of Since 2012 Nkom has collected statistics on the number of mobile telephony subscriptions that include 1 GB or more per month. This is shown in figure 22. There were just under 3.19 million 10 Mobile telephony subscriptions that are registered to devices with an organisation number are regarded as business subscriptions. All other subscriptions are counted as residential subscriptions. 11 These are referred to as active subscriptions for mobile data and are defined as all subscriptions that have generated more than 0.5 MB of data in at least one of the last three months of the year. 30

31 Number of subscriptions in thousands subscriptions at the end of the first half of This is close to 55 per cent of the total number of subscriptions. By comparison, at the end of 2014 the number of subscriptions that included 1 GB or more was over 2.87 million, i.e. more than 49 per cent of the total number of subscriptions. From 2014, Nkom has also collected statistics on the number of mobile telephony subscriptions that include 5 GB or more per month. This is shown in figure 22. At the end of the first half of 2015 there were almost 800,000 such subscriptions, which is about 14 per cent of the total number of subscriptions. The share that has 1 GB or more included in the subscription is higher for business subscriptions than for residential subscriptions. This is even more true for subscriptions with 5 GB or more included. More than 64 per cent of business subscriptions had 1 GB or more included at the end of the first half of At the end of 2014 the corresponding figure was nearly 58 per cent. More than 27 per cent of business subscriptions had 5 GB or more included in the subscription at the end of the first half of At the end of 2014 the corresponding figure was 22 per cent Number of active mobile users Number of subscriptions that include 1 GB or more Number of subscriptions that include 5 GB or more Total number of mobile phone subscriptions Figure 22 Number of mobile telephony subscriptions that are active for mobile data. Number of subscriptions that include 1 GB and 5 GB or more per month Figure 23 shows the development in the number of mobile broadband only 12 subscriptions from 2009 to the end of the first half of The number of subscriptions rose each year until 12 Special subscriptions for mobile broadband are subscriptions that are used eclusively for mobile data. They can be bought and used independently of a mobile telephony subscription. From 2014 the definition of mobile broadband has been amended. In the past, it included additional services for data usage linked to a mobile 31

32 Number of subscriptions in thousands Thereafter, it has declined every year. At the end of the first half of 2015, the total number of subscriptions was just over 511,000. This is a decrease of nearly 24,000 since the end of The share of business subscriptions was almost 70 per cent at the end of the first half of Residential Business Total Figure 23 Number of special subscriptions for mobile broadband 4.3 Traffic Minutes The total number of traffic minutes originated in mobile networks was over 7.08 billion in the first half of This is about 291 million higher than in the first half of 2014, representing an increase of almost 4.3 per cent. From the first half of 2013 to the first half of 2014, the equivalent increase was just over 262 million minutes, or 2.0 per cent. Figure 24 shows the development in the number of traffic minutes from mobile phones, broken down into traffic to mobile networks, the fied network and international calls. In the first half of 2015, there was a decline in the number of traffic minutes to fied networks of more than 33 million minutes compared to the first half of By comparison, from the first half of 2013 to the first half of 2014, there was an increase of nearly 30 million minutes. Traffic from mobile telephones increased by nearly 322 million minutes from the first half of 2014 to the first half of 2015, an increase of 5.9 per cent. By comparison, this traffic increased telephony subscription, such as twin SIM cards, for eample. The historical figures have been adjusted to match the new definition. 32

33 Million minutes by approimately 203 million minutes from the first half of 2013 to the first half of International traffic increased by just over 2 million minutes in the first half of International calls Traffic to fied networks Traffic to mobile networks Total Figure 24 Traffic minutes from mobile phones, broken down by direction of traffic Messages Figures 25, 26 and 27 show the development in the total number of messages sent, broken down by SMS messages, MMS messages, and content messages 13. In total, mobile phone subscribers sent nearly 7 billion messages in the first half of This is nearly 231 million more than in the first half of By comparison, there was a decrease of about NOK 298 million from the first half of 2013 to the first half of On average, Norwegian mobile telephone customers sent nearly 104 messages per month in the first half of In the same period in 2014, the average number of messages was less than 98. Of these, sent SMS messages constitute 90 in the first half of 2015 and 86 in the first half of A decline in the number of SMS messages was registered for the first time in the first half of With the eception of the first half of 2012, the decline has continued until the first half of However, in the first half of 2015 there is a significant increase. Mobile phone subscribers sent more than 3.1 billion SMS messages in the first half of This is nearly 123 million more than in the first half of These are mainly messages conveyed to mobile customers based on a CPA agreement between content providers and mobile operators. CPA = Content Provider Access 33

34 Million messages Million messages Figure 25 Number of SMS messages sent The number of MMS messages has tended to vary slightly from year to year. Since the first half of 2012, however, there has been an annual increase. In the first half of 2015, the number of messages rose by roughly 5 million compared to the first half of This corresponds to an increase of around 6 per cent. However, the number of MMS messages represents only a fraction of the total number of messages. In the first half of 2015, just under 87 million MMS messages were sent Figure 26 Number of MMS messages sent 34

35 Million messages The number of content messages has risen each year since the first half of In the first half of 2015 there were about 408 million content messages, an increase of more than 92 million compared with the first half of Figure 27 Number of content messages sent Data traffic Figure 28 shows the change in the total data traffic for mobile telephony subscriptions and special subscriptions for mobile broadband. Total data traffic in the first half of 2015 was nearly 45,200 TB 14 (45.2 million GB). This is an increase of approimately 17,900 TB from the first half of 2014, when the combined data volume was about 27,300 TB. By comparison, the increase from the first half of 2013 to the first half of 2014 was nearly 11,300 TB. Relatively speaking, the increase from the first half of 2014 to the first half of 2015 was 65 per cent, while it was 70 per cent from the first half of 2013 to the first half of TB = 1,000 GB. 1 PB = 1,000 TB = 1 million GB. 35