While Q1 is seasonally weak, the annual drop in service revenue accelerated to 9.0 percent from 5.8 percent a year ago, amid a continued fall in voice revenue and a double-digit drop in SMS revenue. While data services are still growing, the fall-off in SMS in favour of IP applications meant non-voice service revenue grew only 2.3 percent year-on-year in Q1. As voice revenue declines, the share of non-voice in total service revenue rose to 44.8 percent in the quarter.
Among the three mobile operators, mainly T-Mobile but also Vodafone increased their shares of the market's service revenues in Q1, as KPN lost the most revenues both on an annual and quarterly basis. T-Mobile increased its market share annually by 2.1 percent points, and Vodafone added 0.4 percent, while KPN lost 2.5 percent points.
KPN was still the largest in terms of customer numbers, with 48 percent of all Sims at the end of March 2014. Vodafone's share of customers declined to 27 percent, while T-Mobile was relatively stable at 25 percent. Excluding M2M and MVNOs, the market shares look somewhat different, with KPN dropping to 41 percent, while Vodafone and T-Mobile increased to respectively 32 percent and 27 percent of all Sims.
In total, the Dutch mobile market (including Tele2, Ziggo and the rest of the MVNOs) saw a slight decrease of 1.3 percent annually to 20.3 million Sims at the end of March 2014. As a consequence mobile market penetration decreased from 122.5 percent in Q1 2013 to 120.4 percent in Q1 2014. Telecompaper expects the total market to return to growth by the end of 2014 and increase to 22.6 million mobile SIMs in 2018 (excluding M2M).
