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According to the latest data from PMR, the value of the telecommunications services for business and carrier segment in Poland in 2019 was PLN 14.3bn. In the last three years the market has been moving in a sideways trend, with a trend towards stabilisation. The increase in prices of mobile and ISP services is helping.
Stabilisation in the retail market
According to the latest data from PMR, the value of the telecommunications services for business and carrier segment in Poland in 2019 was PLN 14.3bn. In the last three years the market has been moving in a sideways trend, with a trend towards stabilisation. This is mainly due to the situation on the retail market of telecommunications services for business, where operators are implementing a strategy of price increases in exchange for a wider range of services offered. This trend is visible in the segments of mobile telephony and Internet access services. The situation in the data transmission segment has also improved – after seven years of decline, the market stabilised in 2019 as a result of the growing scale of transmission capacities used by companies (higher purchase volumes). In parallel, the entire market is negatively affected by the wholesale segment.
PMR expects similar trends on the market in the coming years. The average annual growth rate (CAGR) of the market in the years 2020-2025 will be 1.8%. Nevertheless, PMR expects some losses for the industry due to the announced SARS-CoV-2 coronavirus pandemic and lower GDP projections, mainly in the short term. Paradoxically, the epidemiological factor will also have a positive impact on the market.
Higher ARPU from mobile services and Internet access
PMR estimates that the value of the mobile services market for the B2B segment in 2019, after a few years of declining trend, has rebounded, increasing by 3% y/y. The reversal of the trend and last year’s increase in the value of the market is mainly due to a change in the mobile services segment. With a steady increase in the number of SIM cards, the lower erosion of ARPU from mobile services in the handset resulted in an increase in operators’ revenues on this account. The main trend responsible for such a situation on the market is a change in operators’ strategy in the fight for the customer. It is no longer the price factor that plays a decisive role, but the quality of service factor – in return for a higher subscription price customers receive a wider range of services, mainly higher mobile data transmission packages. In line with this strategy, mobile operators have been introducing higher prices for business mobile services in 2018-2019. Similarly to the mass market, this involves ensuring a pool of funds to cover ongoing infrastructure investments (mainly construction of 5G networks).
The market of Internet access services for business customers in Poland in the last two years recorded an average annual growth of 3%. The positive market situation is an effect of two overlapping trends – steadily growing number of subscribers of access services in the B2B segment and increasing prices for access lines. As part of the “more for more” strategy, operators provide customers with higher capacity lines at a higher price rate. The reason for the market’s growth are mainly Internet offers focused on the fibre-optic model and modernized TVK lines. This closely correlates with the demand side in the B2B segment, where companies are increasingly demanding high-performance lines capable of handling the growing volume of transmitted data.
The trend of higher prices for mobile and ISP services will also be visible on the market over the next six years. This will remain in correlation with higher data volumes in mobile and fixed networks.
Growing P4 infrastructure slows down MNOs’ wholesale revenues
Between 2018 and 2019, the market for wholesale telecommunications services, after growth in 2017, once again found itself in a downward trend. In the last two years, the decline in the value of the wholesale telecommunications services market has been mainly caused by the fixed telephony and wholesale line rental segments. The segment of wholesale mobile services, which is stagnating, with a slight downward trend, is practically neutral. The reason for this situation are lower wholesale revenues reported by Polkomtel in 2018 and the withdrawal of P4 from the use of domestic roaming services as part of infrastructure rental from other operators – the effect of which is a decrease in wholesale revenues of Orange, T-Mobile and Polkomtel on this account in 2019.