Telecom market reaches EUR 2.2bln in 2010

After a period of rapid growth, Romania still faces delayed crisis impact with no immediate sign of recovery.

The telecom market has been specifically affected, declining over the last 2 years, caused by churn and customer base shrinkage, falling ARPU and adoption of substitutes such as VOIP and neighboring networks, according to the survey Romanian Market Development- Challenges and Opportunities, carried out by AT Kearney.

The mobile market evolution indicates a decrease of 4 percent from 2008, when the market summed up EUR 2.5 billion until 2010, when the market amounted to EUR 2.2 billion.

“The industry consolidation is getting momentum, following recent moves of Cosmote such as the acquisition of Telemobil and merger with Romtelecom recently started, the consolidation of cable industry, by RDS&RCS and Romtelecom as well as possible consequences of announced asset optimization between France Telecom and Deutsche Telekom,” says the survey.

Following a period of impressive growth, the Romanian economy slumped in 2009 by 7,1 percent and further declined in 2010 by 1,9 percent.

Read more about

East European Coffee Culture Festival: brewing excitement this weekend

read more

The Romanian mobile market went from EUR 2.5 billion in 2008 to EUR 2.2 billion in 2010, which represented a 4 percent decrease. 

No rapid recovery is expected over the next period, says the survey.

The number of mobile users has been rather stagnating from 22.4 million users in 2008 to 24.9 million in 2010, on a prepaid dominated market.

The evolution of the average revenue per user (ARPU) slumped by 17 percent as it went from EUR 9.2 a month in 2008 to EUR 6.3 a month in 2010.

“The market performance of the two leaders, Orange and Vodafone, was impacted by the crisis while Cosmote managed to further improve its revenues and EBITDA in 2010, following the acquisition of Zapp in 2009,” according to the survey.

Thus, the revenues of Orange Romania, which is still market leader, decreased by 14 percent, from EUR 1.3 billion in 2008 to EUR 973 million in 2010.

The number of customers of Orange Romania remained relatively constant: it went from 10,355,000 in 2008 to 10,464,000 in 2010.

Vodafone, the first runner up on the telecom market, saw its revenues decline by 14 percent from EUR 1 billion in 2008 to EUR 816 million in 2010.

The operator had 9,650,000 customers in 2008 while in 2010 their number was 9,804,000.

Cosmote, the third player on the market, saw its revenues rise by 23 percent from EUR 311 million in 2008 to EUR 469 million in 2010.

Cosmote had 5,984,000 customers at the end of 2008, while in 2010 their number increased up to 6,849,000.

Otilia Haraga