Subscriber growth to continue - overview of Romanian mobile market
Close
By Kester Mann, Research Analyst (from GSM'centric EMC)
Despite its modest penetration rate (14.5% at the end of September 2001 according to EMC), the Romanian mobile market has witnessed impressive growth during the previous 12 months with subscriber numbers increasing 57% since the end of September 2000 to reach approximately 3.25 million. With the newest operator, OTE-backed CosmoRom, slowly gaining market share over established GSM-900 operators MobilRom and MobiFon and the forthcoming launch of CDMA-450 services by Telemobil, the market seems set for further expansion. Indeed Thomas Lundin, the chairman of Ericsson Romania, who supply infrastructure equipment to MobiFon, has stated that he believes the Romanian cellular market will grow at least as fast over the next few years as during the previous 12 months.
Source: EMC World Cellular Database
MobiFon the new market leader - CosmoRom gains share
At the end of September 2001, over 90% of Romania's subscribers were accounted for by MobiFon and MobilRom. Connex-branded MobiFon overtook MobilRom as market leader in March 2000 and had 1.62 million subscribers at the end of Q3 2001 compared with 1.44 million for its closest competitor. Whilst MobilRom's market share has fallen from 50.2% in September 2000 to 44.4% 12 months later, MobiFon's share has increased from 48.5% to 50.0% over the period. Meanwhile CosmoRom had 174,000 subscribers at the end of September 2001, a year and a half after commencing operations. The OTE-backed operator had a market share of 5.4% but has been claiming approximately 20% of the country's net additions during H2 2001. The fourth operator, Telemobil, had only approximately 10,000 NMT-450 subscribers at the end of September 2001, giving it a market share of less that 1%.
Source: EMC World Cellular Database
Subscriber base comparison: September 2000 to September 2001
Subscribers 9/00 Subscribers 9/01 % change CosmoRom 10,000 174,000 1,640 MobiFon 1,001,000 1,622,700 62.1 MobilRom 1,037,000 1,444,000 39.2 Telemobil 17,840 10,000 -43.9 Total 2,065,840 3,250,700 57.4 Source: EMC World Cellular Database
MobiFon
MobiFon launched services in April 1997 and had 1.62 million subscribers at the end of September 2001, of which approximately 62% were prepaid. The network covers 79% of Romania's territory and 91% of its population. The Connex-branded operator is 54.7% owned by TIW subsidiary ClearWave, who is also the majority owner of Cesky Mobil in the Czech Republic, while AirTouch Europe has a 20.1% stake. The operator launched commercial GPRS services on 2 October 2001 offering a 50% tariff reduction until the end of the year ().
MobiFon offers a total of nine postpaid tariffs. The Connex Classic tariff () is aimed at off-peak users with calls within the network costing $0.04 per minute. The Connex Club () and Connex Business tariffs () both target subscribers who wish to make regular calls throughout the day, the latter offering cheaper monthly fees ($15 compared with $20) but more expensive peak and off-peak calls to both mobiles and fixed lines. The Connex Activ tariff () does not distinguish between peak and off-peak hours and offers a 30% discount on each minute of a call after 30 minutes. The Cent package () is designed for subscribers who wish to mainly call other Connex users; weekend calls within the network are charged at $0.01 per minute while those to other networks cost $0.25 per minute. Additionally, four tariffs include free minutes; Connex 100 (), 200 (), 400 () and 800 (), which have increasing monthly fees for additional inclusive minutes.
MobilRom
GSM-900 operator MobilRom is backed by France Telecom, whose Orange brand name is to replace the network's existing name, Dialog. The powerful identity and image of Orange together with its innovative marketing approach will provide a tough challenge to Connex as MobilRom attempts to regain its market leadership. Dialog began operations in June 1997 and its services currently cover 92% of the country's population. Approximately 53% (765,000) of its 1.44 million subscribers were prepaid at the end of September 2001. Like MobiFon, MobilRom launched commercial GPRS services at the beginning of October 2001.
The operator offers a total of eight postpaid tariff options. The Dialog Inedit tariff () offers a monthly subscription fee of $4 per month but the most expensive calls to other mobile networks ($0.3 per minute at all times). Dialog Practic () and Dialog 60 () are designed mainly for private, occasional users while Dialog 160 (), Dialog 300 (), Dialog 600 () and Dialog 1000 () target professionals and day time users. Meanwhile the Dialog Free tariff () recently increased the number of inclusive minutes it offers from 120 to 180 per month.
CosmoRom
CosmoRom became Romania's fourth mobile operator when it launched GSM-1800 services in March 2000 (). The operator's initial strategy was to match its competitors in terms of coverage and focus on value added services such as SMS, voicemail, call holding, call waiting and call forwarding, all of which were offered free of charge. Its tariffs aimed at being straight forward and, wishing to avoid a price war with the established operators, did not aim at being the cheapest on the market.
CosmoRom is 99.96% owned by fixed line operator RomTelecom. In November 1998, Greek company OTE bought a 35% stake in RomTelecom () and also has voting rights to an additional 16%. It has recently indicated an interest in upping its stake to a 51% majority and has stated that it is particularly interested in the Romanian mobile market, predicting rapid growth during 2002. OTE plans to invest $300 million over the next five years on top of the $262 million it budgeted for 2001 (). CosmoRom has targeted 200,000 to 250,000 subscribers by the end of 2002.
Telemobil
In May 1993, Telemobil became the first mobile operator in Romania when it launched its NMT-450 service. Originally Telefonica Romania but relaunched as SunTel in May 1999, the NMT-450 operator aimed to become a niche player in the market, capitalising on wider coverage provided by lower frequencies and competitive pricing. It targeted 100,000 subscribers by the end of 2000, however according to EMC never exceeded its peak of 25,000 customers at the end of Q1 2001.
However, Telemobil has recently been acquired by Inquam, a subsidiary of CDMA developer Qualcomm, who in October 2001 announced plans to digitalise the NMT network to CDMA-450 (). The operator said recently that it planned to launch CDMA services 'within weeks' and has already invested $100 million with a further $200 million earmarked for the next two years. The new service, for which equipment will be supplied by Lucent, will be available in 18 cities and is expected to cover the whole country by the end of 2002. The supply of equipment for the CDMA-450 network was agreed when Romanian Prime Minister Adrian Nastase and US Trade Secretary Donald Evans signed a letter of intent on 1 November 2001.
UMTS
The UMTS tender in Romania is expected to be organised during 2002 although it may not take place until after thefixed telecommunications market is liberalised in early 2003. The chairman of Ericsson Romania, Thomas Lundin, stated recently that he did not believe that the Romanian market is ready for UMTS technology. It is a similar view to that held by Ted Lattimore, chairman of MobiFon, who forecasts that UMTS services will not be available until around 2004 but will eventually be in 'reasonable' demand in Romania.
e-searchwireless.com |
