An annual report issued by AKEP shows that after a recovery in 2012, mobile companies posted 37 billion lek (Euro 261 million) in revenues, a 12 percent decline compared to 2012, suffering their lowest level since a decade ago when only two mobile companies operated in Albania.
TIRANA, July 30 – Mobile companies’ revenues suffered a double digit shrink in 2013 fuelled by ongoing slowdown in mobile tariffs which the Electronic and Postal Communications Authority says have now dropped to EU and regional countries levels.
An annual report issued by AKEP shows that after a recovery in 2012, mobile companies posted 37 billion lek (Euro 261 million) in revenues, a 12 percent decline compared to 2012, suffering their lowest level since a decade ago when only two mobile companies operated in Albania.
Data shows leading operator Vodafone Albania, part of Vodafone Group Plc, lost 6 percent of its revenue market share in 2013, but yet controlling 50 percent of the market. The three remaining operators gained a slight advantage with AMC increasing its market share to 33 percent, Eagle Mobile to 11 percent and Plus Communication to 6 percent.
Vodafone Albania, which has 45 percent of total active subscribers, registered a drop in revenue in 2013 after reaching its peak level in 2012 when its market share hit a record high of 56 percent. AKEP data shows Vodafone’s revenue in 2013 dropped to 18.5 billion lek (Euro 130 million) while the company’s net profit dropped to 3.3 billion lek (Euro 23.2 million), the lowest level in the past three years.
AMC, the second largest operator with 40 percent of active users, continued registering lower revenue despite increasing its market share to 33 percent, up from 29 percent in 2012.
AMC, the first mobile operator in Albania since 2000 part of Greece’s Cosmote Group and Deutsche Telecom, reported a net profit of 4.1 billion lek (Euro 29 million), the highest among all four operators, mainly because of interest rate income from its investment in its parent Greece-based Cosmote, accounting for 16 percent of total income in 2013, says AKEP.
Turkish-owned Eagle Mobile and Albania-owned Plus Communication posted losses for the fourth year in a row although increasing their market share to 11 percent and 6 percent respectively.
Mobile companies’ revenues registered a turning point in 2012 when they increased by 7.2 percent to 42 billion lek (Euro 291 million), ending their downward trend in the 2009-2011 period.
Mobile operators saw their revenues drop for the third year in a row in 2011, reflecting the crisis impacts and increased competition which has considerably lowered tariffs. A report published by the Electronic and Postal Communication Authority (AKEP) shows total revenues for all four mobile operators in 2011 shrank by 6 percent to 39.2 billion lek (Euro 275 million). The market started slightly shrinking in terms of revenue in 2009 after the successful launch of the third operator, Turkish-owned Eagle Mobile in March 2008, which made competition tougher. In 2010, mobile companies’ revenues dropped by 11 percent year-on-year.
Market growth
The number of active mobile users, defined as those that have made or received at least a call or SMS in the last three months, rose to 3.7 million in 2013 with a penetration rate of 130 percent up from 3.5 million in 2012, says the Electronic and Postal Communications Authority in its annual report. The number of mobile subscribers with 3G access almost doubled to 1.2 million in 2013 after a third operator made the service available.
Meanwhile, the number of fixed telephony subscribers dropped by 10 percent to around 281,000 at the end of 2013.
“Mobile phone rates continued their downward trend even in 2013, dropping by 35 percent for medium user baskets and by 28 percent for the high usage basket, standing at the average rate of EU and regional countries,” says AKEP.
Mobile subscribers also continued being active on number portability, with an estimated 101,622 mobile numbers ported in 2013 and 4,875 fixed telephony numbers.
Four mobile companies operate in Albania, three of which already offer 3G services.
Competition fuels growth
The alignment of the national regulatory framework for electronic communications and information society services has developed slowly, but gained speed over the past four years, says a report prepared by Cullen International for the European Commission.
Major progress has been made with the adoption of primary legislation based on the EU 2009 regulatory framework in October 2012 and the Audiovisual Media Service Directive in March 2013. Practical implementation, however, has often been hampered by a lack of institutional stability as well as frequent political interventions, notes the report.
The Albanian mobile market has undergone rapid growth fuelled by competition among four mobile network operators. The deployment of mobile broadband, however, has been hampered by the late introduction of 3G services and further regulatory measures are required to complete refarming of 900 MHz and 1800 MHz spectrum for 3G and 4G mobile broadband services, says the report.
Fixed telephony and broadband penetration in Albania are amongst the lowest in the region, says the report.
Fixed lines penetration stood at 11 percent in 2012 while fixed broadband penetration was at only 5.7 percent. Turkish-owned Albtelecom remains the dominant fixed player with 89 percent market share by voice traffic and 67 percent by revenue. Competition has emerged in the fixed broadband market, with alternative operators providing 58 percent of the connections over their own infrastructure.
Albania, which until 2007 had the highest fixed to mobile call charges, has also seen sharp reductions and currently presents fixed to mobile call prices aligned with the average level in other monitored countries.
The report also cites a decision on a probe by the country’s competition Authority on Vodafone’s alleged abuse of its dominant position as “creating competition concerns in the mobile market and may have negative effects for the smaller competitors in the long term.”
