Bopping along the bottom: European mobile in Q3 2019

Report Overview

Bopping along the bottom: European mobile in Q3 2019

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Bopping along the bottom: European mobile in Q3 2019
European mobile revenues remain decidedly in decline this quarter at -2% – a slight worsening since Q2 as the full force of cuts to intra EU calls hits
There are signs that dual brand strategies may be reaching their useful limit as erstwhile premium customers shift to value
There is scope for some trends to slowly improve from here, although end of contract notifications will impact all markets before the end of 2020, with the UK first off the blocks in Q1

Contents

Executive summary – bopping along the bottom

Reported and underlying revenue growth

  • Still decidedly in decline
  • North/South divide narrows further
  • Vodafone revenue growth deteriorates but subscribers recover
  • Intra-EU calls drag doubled this quarter
  • Vodafone convergence strategy a major drag on German ARPU
  • A staggered start for 5G with French auction scheduled for Spring
  • Infrastructure sharing gains in popularity
  • End-of-contract notifications a likely drag during 2020

Country analysis

  • UK – worst performance in six years
  • UK outlook remains challenging
  • France – growth a bit tempered
  • Germany – slips into decline as O2 resurgence continues
  • Italy – market shifts to value
  • Spain – Long, slow road to recovery for Vodafone

Appendix

  • Mobile termination rates (MTR) impact de minimis
  • Reported mobile service revenue
  • Consolidation and convergence timeline

List of charts/tables

Reported mobile revenue growth – top 5 European markets

Service revenue growth by market

Service revenue growth by operator group – top 5 European markets

Drivers of 2018 trends in major EU mobile markets

Mobile service revenue growth in Northern and Southern markets

Mobile service revenue growth vs peers in top 4 European markets

Vodafone contract net adds in top 4 European markets

Intra-EU calling prices Euro cents per minute prior to cuts in May 2019

T-Mobile vs Vodafone Germany year on year ARPU growth

Change in customer lifetime contribution due to converged bundle

Recent and forthcoming spectrum auctions

Spectrum auction results in Germany

Vodafone tower/network share deals

Potential drag from out-of-contract customers spinning down

Service revenue growth

Contract net additions (000)

Reported mobile service revenue growth by operator

Outlook for change in mobile trends in 2019/2020 by operator

Service revenue growth, reported and excluding VAT impact

Contract net additions (000)

Service revenue growth by operator

Service revenue growth, reported and excluding MTR impact

Contract net additions (000)

Service revenue growth by operator

Reported service revenue growth

Total subscriber net additions (000)

Service revenue growth by operator

Service revenue growth, reported and excluding MTR impact

Contract net additions (000)

Service revenue growth by operator

Regulatory impact – top 5 European markets

European MTR rates (Euro cents)

Regulatory impact by market

Reported mobile service revenue

European MNO consolidation timeline