Latest Developments in the Lithuanian
Telecommunications Market
Saulius Gelžinis
Head of Markets and Competition Section
Communications Regulatory Authority (RRT)
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
1
Main topics
• Market before and after liberalization
• Overview of
–
–
–
–
Fixed telephone market
Mobile telephone market
Leased lines market
Internet access market
• Conclusions
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
2
Liberalization of telecommunications
1998 1999 2000 2001 2002 2003 2004
• 07.07.1998 - Privatisation of Incumbent
• 01.08.1998 - Law on Telecommunications
– Fixed telephone market must be liberalized 1 January 2003
– Strong licensing regime
• For the end of 2002:
– 1 fixed telephone service provider (licensed incumbent)
– 3 mobile telephone service providers (with licenses)
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
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Liberalization of telecommunications
1998 1999 2000 2001 2002 2003 2004
•
01.01.2003 – New Law on Telecommunications
–
–
–
–
End of fixed telephony monopoly
Implemented 1998 (“Old”) regulatory framework
No more licenses for telecommunications activities
General authorization regime, prior notification 28 days in advance
required for:
•
•
•
•
Fixed telephone networks and (or) services
Mobile telephone networks and (or) services
Leased lines services
01.05.2004 – Law on Electronic Communications
– Implemented “New” regulatory framework
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
4
Market situation today
1998 1999 2000 2001 2002 2003 2004
• Notifications about telecommunications activities (07.10.2004):
– 37 for fixed telephone services and (or) networks
– 27 for mobile telephone services and (or) networks
– 23 for leased lines services
• Not all of the notified operators are really active in the market
• Rules on market analysis according to the New framework adopted.
First markets to be analysed:
– Call termination on individual public telephone networks provided at fixed
location (9.)
– Voice call termination on individual mobile networks (16.)
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
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Fixed telephone market
• 37 notified operators
– 19 of them – including network provision
• 21 operator really active in the market:
– All 21 offer international telephone services
– 8 of them also offer local and long distance telephone
services
– 6 of them have very limited their own infrastructure
• 27 carrier selection codes 10XX were issued to 23
notified operators
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
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Fixed telephone market
• Total number of fixed telephone lines (ISDN channels
included), thousand
1600
1200
1151,7
935,9
854,7
824,2
823,5
822,0
800
New entrants’ lines
– only 0,5%
400
0
2002 01 01
2003 01 01
2003 06 30
Latest developments in the Lithuanian telecommunication market
2004 01 01
2004 04 01
© Saulius Gelžinis, RRT 2004
2004 06 30
2004-10-07
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Fixed telephone market
• Number of fixed telephone lines per 100 population
33,1
30
27,0
24,7
23,9
23,9
23,9
20
Stable since
1 January 2004
10
0
2002 01 01
2003 01 01
2003 06 30
Latest developments in the Lithuanian telecommunication market
2004 01 01
2004 04 01
© Saulius Gelžinis, RRT 2004
2004 06 30
2004-10-07
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Fixed telephone market
• Total revenues from fixed telephone services in halfyear, million EUR
78,0
76,0
2,4%
74,0
72,0
3,4%
New entrants’
market share
+1,8% comparing
to I H-Y 2003
70,0
68,0
4,2%
66,0
64,0
62,0
Total revenues
–10,7% comparing
to I H-Y 2003
60,0
58,0
New players
Incumbent
2003 I H-Y
2003 II H-Y
2004 I H-Y
1,8
2,5
2,9
74,2
70,7
65,0
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
9
Fixed telephone market
• International traffic in half-year, million minutes
25,0
20,0
15,0
17,2%
9,5%
17,3%
New entrants’
market share
+7,7% comparing
to I H-Y 2003
10,0
International traffic
+19,7% comparing
to I H-Y 2003
5,0
0,0
New players
Incumbent
2003 I H-Y
2003 II H-Y
2004 I H-Y
1,6
3,1
3,5
15,5
14,9
16,9
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
10
Mobile telephone market
• 27 notifications about the activity
• 7 players really active in the market
– 3 old operators with GSM/DCS networks (Omnitel,
Bite GSM, Tele2)
– 4 new service providers (MVNO’s)
• All new service providers use Bite GSM
network
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
11
Mobile telephone market
• Total number of subscribers (all activated SIM cards),
thousands
2746
3000
2000
1646
1936
2170
993
1000
329
509
2000 01
01
2001 01
01
0
2002 01
01
2003 01
01
Latest developments in the Lithuanian telecommunication market
2003 06
30
2004 01
01
2004 06
30
© Saulius Gelžinis, RRT 2004
2004-10-07
12
Mobile telephone market
• The distribution of mobile subscribers (thousand)
3000
169,8
2500
67,7
54,7
2000
1500
1000
1330,7
688,4
902,0
603,0
566,4
482,4
576,7
646,8
763,1
2003 06 30
2004 01 01
2004 06 30
2170
2746
500
0
Total number: 1936
Active post-paid (private)
Active pre-paid
Active post-paid (business)
Non-active
Active = were used at least once in last three months
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
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Fixed and mobile penetration
80
40
79,9
47,6
34,0
32,7
33,1 28,5
9,4
14,6
2000 01 01
2001 01 01
27,0
63,0
56,0
24,7
23,9
23,9
0
2002 01 01
2003 01 01
Fixed penetration
2003 06 30
2004 01 01
2004 06 30
Mobile penetration
The number of total mobile subscribers and fixed telephone lines per 100 population
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
14
Mobile telephone market
• Market shares 2003-06-30
Total revenues I H-Y 2004:
154 million EUR (+11,3%*)
Total number of subscribers
2746 thousand (+41,9%*)
UAB "Omnitel"
41,48%
UAB
"Omnitel"
55,35%
UAB "Tele2"
18,36%
UAB "Tele2"
31,79%
New service providers
0,68%
UAB "Bite
GSM"
24,59%
UAB "Bite GSM"
26,05%
New service providers
1,70%
* Comparing to the same period of 2003
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
15
Mobile telephone market
• Market shares in specific types of active subscribers
2004-06-30
Active Private
763 thousand (+32,3%*)
UAB "Bite
GSM"
14,2%
UAB
"Omnitel"
51,0%
UAB "Tele2"
34,1%
Active Business
482 thousand (-20,0%)
UAB "Tele2"
3,7%
New service providers
0,7%
UAB "Omnitel"
61,9%
New service providers
2,8%
Active Prepaid
1331 thousand (+93,3%*)
UAB "Bite
GSM"
29,1%
UAB "Omnitel"
32,2%
UAB "Bite
GSM"
31,7%
UAB "Tele2"
38,7%
* Comparing to the same period of 2003
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
16
Mobile telephone market
• SMS and MMS usage (sent in half-year)
SMS, millions
MMS, thousands
700
0,700
581
600
500
478
0,584
0,600
0,500
419
400
0,400
300
0,300
200
0,200
100
0,100
0
0,122
0,020
0,000
2003 I H-Y
2003 II H-Y
2004 I H-Y
Latest developments in the Lithuanian telecommunication market
2003 I H-Y
2003 II H-Y
© Saulius Gelžinis, RRT 2004
2004 I H-Y
2004-10-07
17
Leased lines
•
•
•
23 notifications about the activity
12 players really active in the market
The biggest part of the market belongs to incumbent
Revenues from leased lines, million EUR
4,50
4,00
3,50
3,00
1,88
1,55
2,50
1,80
2,00
1,50
1,00
2,03
2,01
2003 I H-Y
2003 II H-Y
1,69
0,50
0,00
Lietuvos Telekomas (Incumbent)
Latest developments in the Lithuanian telecommunication market
2004 I H-Y
Others
© Saulius Gelžinis, RRT 2004
2004-10-07
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Leased lines
•
•
•
Total number of leased lines 30 06 2004: 4400
The biggest part of the supplied leased lines are analog
Very few leased lines >2Mbps
Types of leased lines, thousand
5,0
0,03
0,03
0,01
4,0
1,00
1,01
0,80
3,0
2,0
3,30
3,26
3,36
2003 06 30
2004 01 01
2004 06 30
Analog
Digital (up to and including 2 Mbps)
1,0
0,0
Latest developments in the Lithuanian telecommunication market
Digital >2Mbps
© Saulius Gelžinis, RRT 2004
2004-10-07
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Internet access
• No notifications are needed
• Requirement to submit quarterly reports about
the activity
• 82 Internet service providers
• 273 thousand of internet subscriptions in the
middle of 2004
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
20
Internet access
• The increase of Internet subscribers (thousand)
300
250
88,0
200
150
66,8
100
184,9
37,5
50
57,4
94,6
Almost 3 times more
in one year
0
2003 06 30
2004 01 01
Narrowband (Dialup+mobile)
Latest developments in the Lithuanian telecommunication market
2004 06 30
Broadband
© Saulius Gelžinis, RRT 2004
2004-10-07
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Internet access
• Market shares
Total number of subscribers 2004-06-30
273 thousand
Total revenues 2004 I H-Y
20,7 million EUR
AB „Lietuvos
telekomas“
50,1%
UAB „Omnitel“
25,6%
AB „Lietuvos
telekomas“
26,5%
UAB „Bite GSM“
26,5%
Others
15,0%
Others
22,2%
UAB „Skaineta“
1,3%
UAB "Telerena"
2,0%
VI „Infostruktura“
1,5%
UAB „Balticum TV“
1,5%
Latest developments in the Lithuanian telecommunication market
UAB „Omnitel“
8,7%
UAB „Bite GSM“
4,2%
UAB "Microlink Data"
4,6%
UAB „Baltnetos
komunikacijos“
UAB „Balticum TV“
3,6%
2,7%
© Saulius Gelžinis, RRT 2004
VI „Infostruktura“
3,9%
2004-10-07
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Internet access
• 68 % of all subscriptions – narrowband (185 thousand)
Internet connection types (2004 06 30)
Mobile networks
48,40%
Wireless
2,20%
Dialup
19,36%
Cable modems
8,58%
Others (PLC, satellite)
0,02%
Fiber
1,39%
Leased line
0,55%
xDSL
12,37%
Latest developments in the Lithuanian telecommunication market
LAN
7,13%
© Saulius Gelžinis, RRT 2004
2004-10-07
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Internet access
• 32% of all subscriptions – broadband (88 thousand)
LAN
22,11%
xDSL
38,37%
Cable modems
26,61%
Fiber
4,30%
Wireless
6,82%
Leased lines
1,72%
Other
0,04%
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
24
Telecommunications market value
•
•
Total market revenues 2004 I half-year 301 million EUR (+5,6%*)
Growing parts of the market:
–
–
–
•
Internet access +27,0%*
Mobile telephone +11,3%* (+30%* in traffic)
Interconnection +8,9%*
Mobile
Telephone services
51,67%
Leased lines
1,23%
Internet
access
6,90%
Diminishing parts of the market:
–
–
Leased lines –10,8%*
Fixed telephone –10,7%* (+16%* in traffic)
Fixed
Telephone services
21,91%
Interconnection
services
18,30%
* Growth in absolute values, comparing to the same period of 2003
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
25
Conclusions
•
Lithuanian telecommunications market is growing, unless revenues from some parts
of it are diminishing (fixed telephone and leased lines)
•
Mobile penetration has reached 80%, almost 52% of all telecommunications market
revenues are from mobile telephone services
•
Changes in revenues and traffic show that due to competition fixed and mobile
telephone services are getting cheaper
•
Number of active post-paid mobile subscribers and fixed telephone lines likely to
remain the same
•
Further growth of broadband Internet connections is expected as today 68% of all
internet subscriptions are narrowband
•
The growth of the number of mobile based internet subscribers is foreseen because
wap services are getting more popular
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
26
Thank You
Questions ?
www.rrt.lt, sgelzinis@rrt.lt
Latest developments in the Lithuanian telecommunication market
© Saulius Gelžinis, RRT 2004
2004-10-07
27