The Dutch fixed broadband market grew by only 0.1% in the second quarter of 2017, according to research by telecompaper.
The number of connections amounted to 7.35 million. Cable grew, but less rapidly than in Q1. In the case of fibre, the development was exactly the other way round. For 2017, the elecompaper expects growth of more than 1% year-on-year.
As in the fourth quarter of 2016, cable and fibre accounted for growth in the broadband market in the first quarter of this year. Fibre grew faster than in Q1 by 1.5% versus 0.9%. For cable, there was a 0.1% growth in the number of connections, compared to 0.3% a quarter earlier.
At DSL (copper), the number of broadband connections continues to decline, despite KPN’s investments in speed improvement with applications such as pair bonding. Since 2015, the operator has been trying to get more out of copper with large-scale upgrades by increasing the speed for millions of households to 200 Mbps maximum for the time being. KPN and its brands (iincluding Telfort and XS4All) plus wholesale partners such as Tele2 already offer VDSL connections with up to 100 Mbps.
Telecompaper expects that the growth in broadband Internet connections will continue to grow in the coming quarters. For 2017, this will result in slightly more than 1% growth compared to 2016. That is considerably less than the 2.6% growth last year compared to 2015. The main cause of the slowdown in growth is the increasing saturation of the fixed broadband Internet market, with a 94% penetration in households.
Viewed by broadband technology, cable remains the market leader with 3.38 million connections. DSL is still number two, despite a decrease to 2.85 million connections. Fibre-optic broadband grew to 1.13 million connections at the end of Q2 2017.
Cable provider Ziggo is still the largest broadband ISP in the Netherlands. The company grew by 0.3% in volume terms in the first quarter to nearly 3.2 million broadband subscribers. This accounts for 43.5% market share. Runner-up KPN grew by 0.3% to 40.5% market share.
In addition to Ziggo and KPN, the market also has a number of smaller players, of which T-Mobile (T-Mobile Home) shows the highest quarterly growth of 8,000 to reach 184,000. This accounts for 2.5% market share. On the other hand, established names such as Tele2 and M7’s Online.nl are losing customers and market share.
“The smaller suppliers are doing well due to the arrival of NLE and T-Mobile,” explained Telecompaper analyst Kamiel Albrecht. “But they seem to win customers mainly from other smaller parties, which means that market leaders Ziggo and KPN do not lose market share, but even win.”
Broadband connection revenues in the second quarter amounted to 474 million Euro. This is equal to the first quarter’s turnover. Telecompaper expects a slight sales growth of 0.4% for the year as a whole, partly due to the price increases of KPN and its brands and Ziggo on 1 July 2017.
For the period 2017-2021, Telecompaper predicts an average annual growth rate of 1.% in the number of broadband connections and an average annual growth rate of 0.8%. The lower revenue growth is also due to the increase in the number of multiplay bundles, where the total revenue per customer is growing but the turnover per service is often
