Large-scale changes continue in telecommunications markets

The number of connected devices continues to grow – and so does the volume of data transmitted in mobile and fixed networks. Popularity of pay-TV and various types of video services is also increasing. Working in companies is increasingly mobile and flexible today. All this sets new kinds of requirements for the quality and availability of operators’ systems and network infrastructure.

Despite undergoing market changes, the competitive environment of the Finnish telecommunications markets is fairly stable. Total net sales of the three biggest telecom service providers – DNA, Elisa and Sonera – is about 90 per cent of the net sales of the markets. Also, no new operators aggressively seeking market shares have emerged. All three leading operators provide both mobile and fixed network services for consumer and corporate customers.

The weak financial situation has affected the telecommunications industry less than many other industries because the demand for data communication services is fairly stable.

Finns are among the leading users of mobile communications in the world

In 2015, net sales of the mobile telecommunications markets in Finland amounted to EUR 1.9 billion(1, and mobile penetration is among the highest in the world. Although mobile penetration was as high as 167 per cent(2 at the end of 2015, subscriber numbers continue to grow.

Finland has the highest mobile penetration in the world

Finland has the highest mobile penetration in the world
Source: IDC

Proportionally, Finland is also the country with the largest number of postpaid subscriptions in Europe. At the end of 2015, as much as 92 per cent of the voice and data service subscribers in the mobile network had a postpaid subscription(3.

Almost all subscriptions supported unlimited data at a fixed monthly fee. Unlimited data combined with high-quality mobile networks has led to a high degree of use of mobile broadband in Finland. In 2015, Finns were the most active mobile data users in the world.

Finns are the most active mobile data users in the world

Finns are the most active mobile data users in the world
Source: tEfficient

Finland has lower fixed broadband penetration than EU countries on average

In 2015, net sales of the fixed telecommunications markets in Finland totalled approximately EUR 1.2 billion(4. Of this, fixed broadband services are estimated to account for approximately 81 per cent.

Approximately 57 per cent of Finnish households have a fixed broadband connection(5. The figure is smaller than in the EU-15 countries on average(6. This is particularly due to high mobile broadband penetration and mobile data subscriptions with unlimited data. In particular, demand for fast, fixed broadband services is expected to grow as popularity of services requiring higher bandwidth, such as streaming video services, increases.

Fixed broadband penetration

Fixed broadband penetration in Finland
Source: Finnish Communications Regulatory Authority, IDC

The pay-TV and video service market is growing

Finnish households mainly use the digital terrestrial TV network and the cable TV network for watching television content but more and more also services provided over the broadband network (e.g. Yle Areena and Netflix). The popularity of cable TV subscriptions has continued to grow steadily, and as many as about 60 per cent of households already receive television content from cable TV network. The number of terrestrial TV households has decreased slightly, but the terrestrial TV network is still the television network most often used in sparsely populated areas and at summer houses in Finland.

The Finnish pay-TV and video service market was estimated to amount to about EUR 235 million in 2015(7. Around 35 per cent of the Finnish households subscribe to pay-TV content(8. Linear broadcasts of cable and terrestrial TV network are the most common way to consume pay-TV content, especially HD sports broadcasts. The growth of the market in the past few years has been particularly attributable to the popularity of streaming and video-on-demand services used over the broadband connection.

Cable television continues to grow in popularity

Cable television continues to grow in popularity
Source: Finnish Communications Regulatory Authority, Statistics Finland

DNA has a strong position in mobile communications, fixed broadband and cable television

DNA has a strong position in all three markets: mobile communications, fixed broadband and cable television. In the cable television market, DNA is the largest player in Finland. In mobile communications and fixed broadband, DNA is a strong number three.

Mobile communication market shares in Finland
DNA is #3 in mobile communications
Cable television market shares in Finland
DNA is #1 in cable television
Fixed broadband market shares in Finland
DNA is #3 in fixed broadband

Sources: FICORA, Ampere

The way of working in companies is changing

Corporate markets comprise telecommunications services and value added services of corporate networks, IT services, IT software and equipment markets. The value of telecommunications markets is estimated to be EUR 1.2 billion, and the value added services markets – essential to DNA – are estimated at EUR 200–300 million (9. IT services and equipment markets form the largest part of the total markets, and their value is estimated to be EUR 6.2 billion(10.

Of telecommunications operators, DNA, Elisa and Sonera provide comprehensive telecommunications and network service solutions. IT service companies, in turn, focus on network value added services, IT services and equipment markets.

Today, working in companies is increasingly mobile, networked and flexible. This is reflected in the telecommunications services that companies require. Mobile data increases in importance, and cloud services gain popularity. The Industrial Internet and the Internet of Things (IoT) will further increase the mobile data volume and provide new growth opportunities for operators.

1) Source: FICORA
2) Source: FICORA, IDC
3) Source: Gartner LINE (Marketvisio)
4) Source: FICORA
5) Source: FICORA
6) Source: FICORA
7) Source: Valor, Finnpanel, TNS Gallup.
8) Source: IHS, DNA’s estimate
9) Source: The company, based on IDC’s and GartnerMarketVision’s data
10) Source: Gartner