The subscription service published by Tariff Consultancy Ltd (TCL) – MNO Trends in Europe 2010 – has revealed that network operators are becoming more efficient in managing both churn and ARPU. Overall subscriber numbers have increased by over 4 million users across the 8 countries over the six month period to the end of June 2010 (or over 8 million users year-on-year).
The report also reveals that average blended monthly ARPU levels rose sharply to Euro 25.40 across the 30 MNOs in the 8 countries in the six month period to the end of June 2010 compared with a year ago.
And average blended annualised churn levels have decreased slightly from 27% (at the end of December 2009) to 26.1% at the end of June 2009 across the 30 MNOs in the TCL survey.
But there have been considerable variations between different operators in the 8 countries (which include France, Germany, Italy, Netherlands, Spain, Sweden, Switzerland and the UK). For example, six out of the 30 MNOs in the six-month period to the end of June 2010 also reported large falls in year on year subscribers.
T-Mobile (Germany) reported the largest year on year fall of 2.1 million customers (caused mainly by a decline of 2.2 million Pre Pay accounts) followed by TIM (Italy) with a decline of over 2 million customers and T-Mobile (Netherlands) with a decline of over 1 million customers.
“Most of the MNOs who reported subscriber decline did so for sound business reasons,” commented Margrit Sessions, Managing Director of TCL. “They have decided to shift the balance of the customer base away from low value accounts and had a high percentage of dormant users.”
Some MNOs reported a dramatic uplift in monthly ARPU as a result of moving their focus away from Pre Pay accounts. “T-Mobile Netherlands saw its monthly blended ARPU improve by 6 Euro at the end of June 2010”, continued Sessions, “the longer term benefits of actively managing your subscriber base can result in higher grade customers, and it is encouraging that many MNOs are focussing on adding value rather than chasing higher subscriber numbers.”
The MNO Trends in Europe 2010 also highlights the main pricing initiatives that are being made by the Operators in the 8 countries over the six month period to the end of June 2010 since the last report was published (which covered the period to the end of 2009). Key pricing trends remain the gradual migration from Pre Pay to Pay Monthly plans, with MNO’s continuing to report strong growth in flat rate plans.
Another universal trend remains the launch of new smart phone handsets with lower cost Android-based handsets becoming popular and a number of operators (such as Vodafone & Movistar) launching their own brand smart phone as a low cost entry model.
“Overall, there are signs of more rational pricing being adopted, after the initial flurry of “all you can eat” data plans,” commented Sessions. “Operators are now fine tuning their Mobile Broadband and mobile data smart phone propositions by launching a tiered approach. More education of the customer is needed but a more targeted data tariff plan has a greater prospect of making an economic return for the MNO. So the pricing trends are pointing towards a more sustainable business model for most operators which is a good sign for the future in what is still a mature market in Europe And overall subscriber numbers have increased by over 4 million users across the 8 countries over the six month period to the end of June 2010 (or over 8 million users year on year).”