The number of mobile customers signed up to virtual operators in the Netherlands rose to 6.81 million in the first quarter of 2018, according to Telecompaper’s latest Dutch Mobile Virtual Operators Market report. That equals growth of 1.5 percent compared to six months earlier. The share of virtual operators (VOs) in the total Dutch mobile market lifted to 33 percent. Growth came more from independent MVNOs than from second brands owned by mobile network operators (MNOs).
In the six months to March, MVNO providers added 76,000 Sim cards, compared to only 22,000 for MNO brands. This difference was mainly due to strong growth at MVNO Simpel. Telfort, a KPN brand, showed a decrease. The other MNO brands managed only small increases to their customer numbers. The virtual market is now divided equally between MVNO and MNO brands, each with 50 percent of Sims.
Thanks to the advance in customer numbers, the virtual players also managed to increase their revenues. Total revenues for Q1 amounted to EUR 212 million, of which 40 percent was for MVNOs. The number is slightly higher than six months before.
41 active players in Q1
The number of active players in the Dutch VO market remained the same at 41, against Q3 2017, with one new player and one old taking leave. Most players were independent MVNOs.
- The newcomer was PrioCom, putting its attention on a new segment within the business market: companies for which company-critical communication is of great importance.
- Stipte stopped offering mobile services in Q1. Vectone's brand Delight Mobile also stopped. The MVNO brands have not been included separately in the MVNO report since Q1, because customer numbers are added to the parent company.·
- Choozze stopped accepting new customers in December, as it re-evaluated its strategy. Choozze will continue to serve existing customers. SOS Mobile has also stopped accepting new customers, but will continue to serve existing customers.
No-frills remains the largest segment
'No-frills' remains the largest segment and even grew by 2 percentage points to 55 percent. Most players, apart from Telfort and Simyo, saw customer numbers rise in this segment, particularly at Simpel.
Ethnic players such as Lebara made up the next largest segment, and still account for just under a third of the market. In third place, the business segment garnered a 10 percent share, followed by the retail trade. The fixed player segment (fixed parties that also offer mobile) followed in fourth place, although it has virtually been erased with the disappearance of Ziggo. The community segment remains the smallest.
Further consolidation expected
Telecompaper expects further consolidation on the market, as it will become increasingly difficult for the many small parties to keep up. VOs are also feeling the effects of constant fierce competition, price pressure, regulations and changing consumer behaviour.
The main challenge for every new virtual operator is to reach a critical mass in a saturated market, Telecompaper said. Other major challenges are the continuous decline of prepaid in the total mobile market, the reduced interest from both MNOs and MVNEs to bring new virtual brands to the market and the difficulty for small players to offer bundled services.
On the other hand, a possible approval of the merger between T-Mobile Netherlands and Tele2 Netherlands could work to the advantage of these two MNOs on the virtual market. Or, they might be more interested in filling in the gaps in their combined network.
