Market outlook

Market outlook according to Interim Report January-September 2016:

Competition is expected to remain intense in 2016. The Finnish economy is slowly returning to growth and the value of the telecommunications market has also returned to the growth path.

In addition to the overall economic situation, net sales and the profitability of the industry are being affected by the increased popularity of IP-based communications solutions driven by the growing number of smart phones and tablets. Moreover, they are affected by the reduction in interconnection prices in the mobile communication network and intense competition in the mobile communication and fixed-line broadband markets in particular.

Strong growth of mobile data use is expected to continue for several years, boosted by the growing number of 4G subscriptions and increased mobile data usage per user. In the coming years, mobile data use will shift mostly to 4G networks.

In the consumer market, consumer demand for fast broadband subscriptions and entertainment services in particular is expected to increase. Fixed-network broadband customers are expected to continue to switch to housing company subscriptions. The mobile broadband subscription base is expected to remain relatively steady in the near future.

In the mobile communication networks, SMS and voice traffic is expected to fall slightly. The market for fixed-network voice services is expected to continue declining. The sales volume of mobile devices in terms of numbers sold is expected to fall slightly in 2016.

Due to the overall economic situation, organisations will continue to seek cost savings, but they also
increasingly need to implement new ICT solutions to improve the productivity of their business. More mobile and versatile ways of working will boost demand for services such as cloud and video conference services. Companies transfer their applications to the cloud to increase their operational efficiency, which will boost the demand for connections with redundancy and high speeds.

The demand for Industrial Internet solutions, and subsequently for M2M subscriptions, is expected to grow.

DNA’s outlook for 2016 has changed

Net sales are expected to increase moderately and the operating result is expected to grow significantly in 2016 compared to 2015. The Group’s financial position is expected to remain at a healthy level.

In the second quarter, net sales were expected to remain at a similar level and the operating result was expected to grow significantly in 2016 compared to 2015. The Group’s financial position was expected to remain at a healthy level.