Growth for European mobile operators continued in 2010, 9.5 million new subscribers in eight European countries

UK: The latest edition of Tariff Consultancy Ltd’s (TCL’s) Mobile Pricing Trends 2010 service highlights that most of the key MNOs continue to see significant subscriber growth even as markets reach maturity.

By the end of 2010, the Mobile Network Operator (MNO) penetration rate across eight key European countries had reached 125 per cent of the population. Out of the 28 MNOs surveyed only 4 had seen a year-on-year decline in subscriber numbers.

The Mobile Pricing Trends analyses the performance of each MNO based on Subscriber Numbers, blended monthly ARPU and blended annualised Churn rates from the end of 2009 compared against the end of 2010. For each country TCL highlights the main new pricing and product initiatives being introduced in each market.

From the latest Mobile Pricing Trends report, TCL highlights the following changes:

* MNO penetration rates across the eight countries have increased by 3 percentage points year on year – from 122 per cent at the end of 2009 to 125 percent at the end of 2010.

* Individual MNOs have reported a full in subscriber numbers, mainly due to managing out sections of their Pre Pay user base – with Telekom (Germany) losing 4.4 million subscribers

* MNO penetration rates are highest in Sweden, with a 159 per cent rate as of the end of 2010, with France having the lowest rate.

* Selected MNOs – particularly in Germany – saw an increase of over 1 million net subscribers (Vodafone and E-Plus in Germany).

* Pre Pay users continued to decline over the period as a proportion of total subscribers. The proportion of Pay Monthly customers increased by 3 percentage points overall to almost 50 percent - an increase of around 17 million users.

* Average blended annualised ARPU for the MNO declined by 2 percent (for the year to the end of 2010) to 26.5 Euro per month. Germany and the UK had the lowest ARPU rates and France and Swiss MNOs had the highest at the end of 2010. Eleven out of the 28 surveyed MNOs increased the ARPU by an average of 3.28 percent.

* Annualised average MNO rates increased over the year, but by less than 2 percent. Some MNOs reduced churn by significant amounts during the period, with Vodafone UK reducing churn by 4.2 percentage points year on year.

Key pricing trends across all of the countries include the focus on smartphones and tablet PCs with the introduction of mobile internet tariffs, mobile broadband tariffs (for USB modem use) based on fixed line broadband tariff structure – as introduced by KPN - and the re-emergence of “all you can eat” data allowances – as introduced by H3G UK for Pay Monthly users in December 2010 as part of its One Plan.

“Although levels of competition for the MNO continue to be severe,” commented Margrit Sessions, MD of Tariff Consultancy Ltd. “MNOs are proving that the mobile sector in Europe is still a growth market with healthy overall subscriber growth for those operators that can differentiate their offers, and take advantage of the boom in smartphones and Pay Monthly contracts.”

“Although individual operators are experiencing contrasting fortunes, particularly in churn rates, where there have been examples of large year on year increases, the most important requirement is for MNOs to actively manage their churn and seek to differentiate their offers based on customer value rather than the cheapest price or chase subscriber numbers,” she added.