2012 Belgium - Telecoms, IP Networks, Digital Media and Forecasts

Cableco competition stimulating Belgacom to invest in FttH

BuddeComm’s half-yearly publication, Belgium - Telecoms, IP Networks, Digital Media and Forecasts, provides a comprehensive overview of the trends and developments in the telecoms and digital media markets in one of Europe’s central and more complex telecom markets. The report includes the regulator’s November 2011 market data update, telco financial and operating data to Q1 2012 and market developments into 2012.

Certain sectors of Belgium’s telecom market, such as broadcasting, are influenced by its larger neighbours France and the Netherlands. The country’s population is split between two main language groups, Flemish and Walloon, with an additional strong German influence. This fragmentation affects regulatory policies. Being the base for several administrative centres of the European Union, Belgium has attracted considerable investment from multinationals, while the significant transient population has also contributed to the high mobile penetration.

Market revenue

The total turnover of the Belgian telecom sector has risen steadily in recent years, despite the economic difficulties which have beset consumers and operators alike since late 2008. Revenue from the fixed market continues to fall slightly, while that from mobile markets has recovered slightly on the back of greater spend on mobile broadband services. This pattern is expected to continue further into 2013 and 2014 though consumer confidence may be slow to return and economic conditions may improve only marginally in the short term. Despite liquidity issues, investment in telecom networks – partly encouraged by government stimulus funds – has grown year-on-year. Alternative operators have invested the largest proportion of the total.

Broadband developments

The broadband sector will be a key prop for overall telecom market growth during the next few years, largely from network upgrades undertaken by Belgacom and the cablecos. The proportion of broadband subscribers with data rates above 10Mb/s is one of the highest in the EU. The scale of the cablecos active in their regional areas has prompted Belgacom to respond with greater endeavour in rolling out FttH/C. The regulator has also promoted FttH, which forms a cornerstone of the government’s Digital Action Plan 2010-2015.

Mobile developments

The 2011 auction of spectrum in the 2.6GHz band – with licences made available from mid-2012 – will help operators reach national broadband goals set by the European Digital Agenda 2020. The conditions of the licenses – for 15 years with the potential for five-year extension, and with no rollout or coverage requirements – were aimed at making it easier for the commercial launch of LTE. Belgium has thus far been a laggard in Europe for 4G, though trials have been undertaken since 2010.

Key telecom parameters – 2010; 2012

(Source: BuddeComm)

Market highlights:

• Norkring België, which launched regional DTTV services at the end of 2011, planned to upgrade its network to the DVB-T2 standard from the first quarter of 2013. This will be the catalyst for Telenet to launch its own services using this standard.
• The auction for spectrum in the 2.6 GHz band will enable licensees to expand their LTE commercial services, expected to be launched later in 2012. This will bolster the country's broadband availability is less densely populated areas in coming years.
• Telenet in early 2012 began adding half a million extra free WiFi locations for customers by turning wireless modems at subscribers’ homes into ‘Homespots’, similar to the concept developed by FON.
• More than a third of broadband subscribers have data speeds of 10Mb/s or higher – one of the highest proportions in the EU – while a fifth have a speed equal to or above 30Mb/s: in this respect Belgium is among the leaders in the EU for very-high speed lines.
• Fibre networks remain slow to develop outside the main cities, where it is targeted at multi-tenanted buildings. Regulatory measures obliging Belgacom to provide competitors access to its fibre network, as well as favourable conditions on duct access and the installation of ducts above ground, will reduce engineering costs by up to 80% and help the country catch up with developments in the leading European markets.

This report is essential reading for those needing high level strategic information and objective analysis on the telecom sector in Belgium. It provides further information on:

• Market liberalisation and regulatory issues;
• The impact of the global economic crisis;
• Telecoms operators – privatisation, acquisitions, new licences;
• Mobile data market developments in coming years in light of spectrum auctions and new license awards;
• 3G developments, regulatory issues and technologies including HSPA and LTE;
• Broadband migration to an FttH architecture;
• Historical and current subscriber statistics and forecasts;
• ARPU statistics and forecasts.

Data in this report is the latest available at the time of preparation and may not be for the current year.