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Growth rates in eight countries forecast to decline from 4% in 1998-2002 to <1.6% for 2002-7... Broadband spend to increase from EUR9.6bn in 2002 to EUR25.8bn in 2007... Spend in Austria, Germany, Italy and Sweden to decline by 2007
10 April 2003 Cambridge, UK -- Growth in fixed telecoms spend in eight of the largest Western European countries is forecast to decrease from 4.1% for 1998-2002 to 1.6% for 2002-7, according to a report released this week by Analysys, the global advisers on telecommunications, IT and media (www.analysys.com).
The slowdown, says Analysys in its latest study Fixed Network Operators in Western Europe: is there an underlying growth market?, is a direct result of voice revenues falling at a faster rate than the corresponding growth in spending on Internet access and data networking services. Within individual countries, notably Austria, Germany, Italy and Sweden, fixed telecoms spend could be in decline by 2007.
However, if fixed operators find the optimal approach to their particular markets, and external uncertainties are resolved, then, says Analysys, total fixed spend could rise by almost 3% (CAGR) from around EUR125bn in 2002 to just over EUR144bn in 2007, according to Analysys' 'high spend' forecast.
This is nearly twice the growth rate forecast in Analysys' more conservative "most likely" forecast in which spend is expected to grow by 1.6% (CAGR) to just over EUR135bn in 2007.
"With such variation in fixed spend growth rates it is vital that network operators are proactive in stimulating the market to reach the 'high spend' forecast, and that they develop flexible strategies to allow them to react quickly to changes in competition, customer demand, regulation and investor expectations," said Ariel Dajes, lead author of the report.
"Operators should focus on customer retention to minimise the decline in spend in the voice market; concentrate on broadband pricing and on ensuring widespread availability; and develop a focused approach to the business data networking market."
The broadband market is the fastest growing segment of fixed telecoms and is forecast to grow rapidly from EUR9.6bn in 2002 to EUR25.8bn in 2007 according to Analysys' "most likely" forecast. Voice spend will decline from EUR82.5bn in 2002 to EUR72.1bn in 2007; Internet dial-up spend will peak in 2004 at EUR10.5bn but will tail off after that; while spend on business data networking services will increase from EUR23.0bn in 2002 to EUR27.3bn in 2007.
Written by Ariel Dajes, the new report analyses the strategic options available to fixed operators to maximise revenues from the different service propositions of voice, Internet (dial-up and broadband) and data networking services, and examines the key drivers that are shaping these services.
The report includes 'high spend' and 'most likely' forecasts for spend on the three service propositions for Austria, France, Germany, Italy, the Netherlands, Spain, Sweden and the UK.
The report is available to purchase online at research.analysys.com/store. Prices start from EUR1900. For more information, telephone Analysys on +44 1223 460600 or email research@analysys.com.
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