The number of customers at virtual mobile operators in the Netherlands fell to 6.6 million at the end of September, down 3.2 percent from six months earlier. The VOs accounted for a 32 percent share of the total mobile market at the end of Q3, according to Telecompaper's latest report 'Dutch Mobile Virtual Operators Market Q3 2017'.
The decline in customers was mainly due to the virtual brands owned by the mobile network operators. Their base fell by 8.6 percent over the six months to 3.25 million, due to losses at KPN's brand Telfort as well as Ziggo Mobiel exiting the market after its merger with Vodafone. Vodafone's brand Hollandsnieuwe also lost customers due to a change in reporting following the merger with Ziggo.
The independent MVNOs grew over the same period, by 2.7 percent to almost 3.4 million Sims, or 51 percent of the total VO market. Growth came mainly from the no-frills providers such as Simpel, the business market and the ethnic segment.
No-frills still biggest segment
The ‘no-frills’ segment, which includes both independent MVNOs and second brands offering basic services at relatively low prices, remains the biggest in the Dutch VO market, with half of all customers. Most providers in this segment increased customer numbers in the most recent period, apart from KPN's brands Telfort and Simyo. Simpel especially saw strong growth.
The second-biggest segment is the so-called ethnic market, targetting customers with an immigrant background or interested in international calls. Lebara leads this segment. The number of customers at ethnic VOs grew slightly, and the segment accounted for just under a third of the VO market.
The business segment came third, with just under 10 percent of the VO market, followed by the retail segment. The fixed segment is quickly disappearing, after Ziggo exited the market, and the community segment remains the smallest.
44 active VOs, with one newcomer and three exits
The number of active VOs in the Netherlands fell to 44 at the end of September, of which most were independent players. Compared to March, one new player launched and three ended their activities. These included the disappearance of Ziggo Mobiel, an end to the Dekatel brand in favour of its owner Yes Telecom, and Internet Overal stopping its mobile activities to focus on cloud services. The newcomer was Tibbaa, a ticketing company that targets especially young people who go to concerts often. Business provider Galaxy also ended its mobile-only offer and moved the customers to Telfort.
Top 5 take 63% of market
The ten largest VOs remain largely the same, apart from Ziggo being replaced by Yes Telecom. Telfort consumer was the biggest in terms of number of Sims at the end of September, followed by Lebara, Lycamobile, Hollandsnieuwe and Simpel - all the same as in Q1 2017. The top five together accounted for 63 percent of all virtual customers, up from 60.7 percent at the end of March 2017. Their market share increased thanks largely to growth at Lebara and Simpel.
Telecompaper expects the VO market to consolidate further, as it becomes increasingly difficult for small providers to remain relevant on the saturated market. The continued intense competition, price pressure, regulation such as the new EU roaming rules and changes in consumer behaviour such as the shift to streaming and IP messaging will all have an impact. VOs also face pressure from the growing tendency to bundle fixed and mobile services on the Dutch market and reduced interest from mobile operators in bringing new VOs to market.
