Dutch mobile market contracts 4% in 2019, T-Mobile outperforms to gain number-2 spot

Mobile service revenues remained under pressure in the Netherlands in 2019, falling 4.1 percent to EUR 3.69 billion, after a 3.7 percent fall the previous year. T-Mobile was the only operator to grow revenues, thanks to its takeover of Tele2 and organic customer growth, and increased its market share to 30 percent, nearly matching number-two Vodafone. Telecompaper expects a further drop in revenues in 2020, albeit at a somewhat slower rate, as competitive pressure on prices lessens somewhat, the market shows continued growth in the number of Sims and more customers move to bigger data bundles.

Tough competition in both the consumer and business markets led to lower service revenues at KPN and Vodafone in 2019, according to Telecompaper’s latest Dutch Mobile Operators report. KPN lost mobile customers over the year, due in part to its decision to discontinue the Telfort brand, but remained market leader with nearly 40 percent of revenue, down from 42.5 percent in 2018. Vodafone showed a small increase in customer numbers, but revenues were still lower, and the company also lost almost 2.5 percent points of market share to reach just over 30 percent for the year.

Q4 revenues down over 5% year-on-year

The picture was not much better in the fourth quarter of 2019, with total revenues down 5.3 percent year-on-year and 1.7 percent lower than in Q3 2019. Both Vodafone (-8.6%) and KPN (-7.1%) underperformed, while T-Mobile (incl. Tele2) showed slightly higher revenues (+0.6%). T-Mobile moved ahead of Vodafone into second place already in Q3 2019, and finished Q4 with just slightly above 31 percent of market revenues.

Sim growth all from postpaid

The Dutch market added 317,000 new Sims in 2019, including 123,000 in Q4 alone, to finish the year with a total of more than 20.7 million (excluding M2M Sims). The growth came entirely from postpaid SIMs, which accelerated growth to nearly 1 million Sims added over the year. The share of postpaid in the total active base reached 81 percent at year-end, up 10 percent points over the past three years.

More Sims, less revenues

Telecompaper expects the number of mobile Sims (excluding M2M) to grow at an around 0.6 percent CAGR to 2024. The increase is mainly due to population growth, as well as FMC packages encouraging customers to add Sims, increased phone usage in certain age groups, as well as Sims in tablets, notebooks and other devices.

Despite the Sim growth, service revenues on the Dutch mobile market will continue to fall. Telecompaper estimates a contraction of 2-3 percent in 2020 and a negative CAGR of 1.6 percent over the five-year forecast period. The slightly slower rate of decline is due to a diminishing impact from regulation, such as lower termination and EU call rate cuts, while factors such as discounts in bundled packages and the increasing use of OTT applications will put pressure on prices.

The above figures are from Telecompaper’s continuous research into the Dutch communications market. A full analysis of all the KPIs in the mobile market with a five-year market forecast is available in the quarterly report ‘Dutch Mobile Operators’, the latest edition of which is now available for purchase. To order a copy of the report or receive a customised analysis, please contact research@telecompaper.com.