The size of the future discount MVNO market – in 16 European countries
| On March 10th. easyMobile launched their discount MVNO concept in the UK – one of Europe’s largest mobile markets. Before easyMobile launched, UK mobile customers were paying between 15p and 40p pr. voice minute and between 5p and 12p to send an SMS. Weeks later the prices have fallen to only 5 to 6p for a voice minute and between 1.7 and 2p for an SMS. Many in the mobile business are calling this the mobile operators’ nightmare – we call it mobile evolution. We have seen exactly this scenario already happen in many other countries and it will continue to happen in more countries after the UK – it is only a question of time. Strand Consult has been closely following the emergence and growth of this new discount MVNO market for the past 4 years and has described everything in detail in a series of reports, lectures, workshops and of course numerous newsletters. The past week’s price reductions on the UK market come as no surprise to us. This is exactly the same development we first saw in Denmark and which adheres exactly to the business models described in our NEW 4th edition of “The Moment of Truth – A portrait of the Discount MVNO / Mobile Operators’ success”. This report has been constantly updated so our customers can follow this young discount MVNO market and how it is developing and also get inspiration as to how it will develop in the future. The report “The Moment of Truth – A portrait of the Discount MVNO / Mobile Operators’ success” is today the most important source of information about this new type of MVNO that have achieved such huge success on markets like Denmark, Norway, Finland – and now also has gotten off to a very good start in the UK and rest of Europe. The size of the future discount MVNO market in 16 European countries At the end of 2004 the Western European mobile market had a total of 357 million customers that spent 130 billion Euro pr. year. A big business area with many big players – but also a business area that is looking at a paradigm shift that is best compared to the enormous changes that the airline industry has seen in the past 5 years. The size of the future discount MVNO market in 16 European countries It has been the Nordic countries that have been the driver in this market By the end of 2004 the Nordic region had just 5,4% of Western Europe’s mobile customers, but 90% of the European web based discount MVNO customers come from this region. Our forecasts show that by 2008, around 19% of all mobile customers in Western Europe will be using a web based discount offering and the Nordic customers will then only constitute 9% of the total number of European customers using this type of offering.Amongst some of the factors that will influence discount MVNO’s roll out across Europe are events like an opening for MVNO’s to operate in Italy, combined with a rather aggressive roll out in countries like France and Spain. When this happens the market will change rapidly. We believe that the French regulative authorities will be looking at opening this market in 2005 and the Spanish and Italian authorities likewise in 2006. The value of the future Discount MVNO market in 16 European countries Today’s Western European mobile market has a value of 130 billion Euros. Our calculations of the future market share and growth of the web based discount players give the following revenue figures: The value of the future Discount MVNO market in 16 European countries Looking at how the market has developed, the Nordic countries have been driving the market accounting for 96% of the total web based discount revenue in Europe – an amount that is however only 0,55% of the total European mobile revenue. If our calculations are correct, then by 2008 19% of all the mobile revenue in Western Europe will come from web based discount offerings and then the Nordic customers share of that revenue will have dropped to just 9% of the total market for web based discount MVNO customers in Western Europe. In the coming years until 2008, the Nordic countries will still be dominating playes in this area, both because they got an early start when the the MVNO’s originally launched there and also because some of the largest European mobile markets like Spain, France and Italy will be late adopters of the web based discount MVNO’s on their markets. |
The Moment of Truth – discount MVNO’s |
