The Dutch mobile market generated service revenues of EUR 938 million in the second quarter, down 8.2 percent from a year earlier, according to the latest quarterly report from Telecompaper. The decline was similar to the first quarter, hurt by regulation, price pressure and tough competition. Tele2 and KPN gained market share year-on-year, while Vodafone's share declined.
Tele2 was the only operator to show revenue growth in Q2, up 13.8 percent year-on-year. While it waits for clearance of the proposed merger with T-Mobile, Tele2 continues to grow its market share, reaching 6.7 percent in Q2. Among the three other players, KPN showed the smallest drop in sales (-5.8%) and grew its market share slightly to 41.7 percent.
T-Mobile's revenues fell 7.2 percent year-on-year, but still increased its market share slightly from a year ago to 22.8 percent. Vodafone had the worst performance, with revenues down 15.9 percent. Its market share fell to 28.8 percent. This means that Tele2 and T-Mobile combined would already be the second-biggest operator in terms of revenues, exceeding Vodafone with a combined share of 29.5 percent.
Compared to the first quarter of 2018, revenues fell 0.3 percent. While Q2 is usually stronger, this was the second year it showed a sequential drop in sales. The operators pointed to regulatory pressure from the drop in roaming prices and termination rates, as well as intense competition. Vodafone estimated that regulation alone reduced sales by EUR 17 million.
Revenue pressure to continue
Telecompaper updated its outlook for the market and now expects a decline of 4 percent over the full year to revenues of EUR 3.9 billion. Over the five years to 2022, the market is expected to show a CAGR of -1.8 percent amid expected continue price pressure from competition. The growth in revenue from data and value-added services is not enough to compensate for the structural decline in voice and SMS revenues.
