Boston, MA -- (SBWIRE) -- 07/28/2012 -- The Q312 update to BMI's Romania Telecommunications Report contains analysis of the market data from the major fixed telephony, broadband and mobile service providers for the period to the end of March 2011. It also utilises data published by Romania's telecoms sector regulator ANCOM. While our forecasts for fixed-line telephony, internet and mobile subscriber growth remain unchanged this quarter, broadband forecasts have been revised downwards. New data from ANCOM indicates that the growth of dedicated mobile broadband subscriptions - comprising USB dongle or modem mobile broadband subscriptions and not smartphone subscriptions - was slower than previously indicated during 2010 and 2011. The number of broadband subscribers grew by just 9.7% against earlier forecasts of 24.7% growth, raising penetration to 20.1%. With private consumption levels picking up slowly after two years of severe austerity, we anticipate the mobile broadband market will grow more quickly in 2012, increasing the penetration rate to 22.6%. We expect growth rates will remain in the high single digits over the remainder of the forecast period at a slowing rate, increasing penetration levels to 29.9% at the end of 2016.
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Q112 saw another quarter - the eighth in a row - of net subscriber losses in Romania's mobile market. All three major operators reported net subscriber losses during 2011 and Q112, and we estimate that fourth-ranked DigiMobil also lost subscribers in Q112. Overall, the market lost 674,000 net subscribers in Q112. However, we have not made any adjustments to forecasts for YE12 and beyond as we are cautiously optimistic that the operators will make up some ground during the course of the year. We still expect the market to shrink again in 2012, but at a much smaller rate than in 2011, and remain relatively stable for the forecast period, with penetration at around 131% by 2016. The negative growth in the market has largely been the result of discounting of inactive subscribers, compounded by macroeconomic difficulties and saturation.
The discounting has had positive effects on both subscriber mix and ARPU levels. Both Vodafone Romania and Cosmote, which release subscriber mix data, report steady improvements in the proportion of postpaid customers, and we believe market leader Orange Romania is following a similar pattern. However, while Vodafone's ARPU levels rose y-o-y in Q112, that of Orange was stable and Cosmote's declined. We still expect ARPUs will continue to increase in 2012 before embarking on a gradual decline and have made no changes to our forecasts.
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