Kosovo - Telecoms, IP Networks, Digital Media and Forecasts, 10th Edition

Abstract

Executive summary

As a potential European Union (EU) candidate (under a United Nations Security Council Resolution 1244), Kosovo is a partner to the EU's Stabilisation Tracking Mechanism, which aims to build an institutional, legislative, economic and social framework directed by the values and models subscribed to by the EU.

As part of the EU pre-accession process, the country has received financial aid to build public institutions and improve cross-border cooperation under the EU fund Instrument for Pre-Accession Assistance. Kosovo is expected to receive € 68.7 million during 2011 and € 70.0 million during 2012. The EU is Kosovo's main trading partner and its main source of foreign direct investment.

Kosovo's telecom industry has been liberalised and legislation has been introduced that adopts regulatory principles found in the EU's regulatory framework for communications, which promotes competition as the most efficient way to offer communications products and services while ensuring universal access. Nevertheless, poor telecom infrastructure has meant that fixed-line penetration remains very low, and as a result fixed-line broadband penetration is also relatively low while in rural areas broadband is dominated by WiMAX solutions.

Prior to independence Kosovo operated its own telecom industry, with a separate ministry, regulator, network operators and service providers. Kosovo is yet to receive a country code from the International Telecommunication Union. Hence network operators in Kosovo at present use one of three country codes: Monaco (+377), Slovenia (+386) and Serbia (381).

Broadband penetration in Kosovo is slowing increasing due to competition and government policy implemented in recognition of the potential of applying ICT to improve both social and economic development. DSL accounts for the majority of broadband connections, while the government and PTK have put in place policy measures to build out a national FttX network.

Kosovo's burgeoning mobile market is comprised of two mobile networks operators and a number of mobile virtual network operators. Competition has improved due to the increased number of service providers. Mobile services are available via both postpaid and prepaid tariff options, with the latter instrumental in popularising mobile voice services due to its inherent flexibility and affordability. Mobile data services such as SMS, MMS, GPRS and EDGE are also available and will become increasingly important as a source of new revenue as growth opportunities from new subscriber additions disappear in the maturing mobile voice market.

Market highlights:

• Competition in the liberalised fixed market is evident as new market entrants account for a growing proportion of total fixed lines. Competition is infrastructure-based due to the present lack of a strong regulator regime in regards to network access. Nevertheless, poor investment in the sector has meant that Kosovan fixed-line telecoms penetration remains among the lowest in Europe.
• Broadband availability through ADSL, cable and wireless is being supplemented by initial FttX deployments. Poor infrastructure means that rural broadband is still dominated by wireless access: WiMAX networks offer near universal population coverage.
• Digital TV programming is available from cable TV operators. The country's main broadcasters have formed a consortium to promote digital terrestrial TV development.
• Competition in the mobile market is secured by two mobile network operators and two mobile virtual network operators. Mobile penetration has broached 90%, showing the sector's popularity in response to poor fixed-line infrastructure.

Henry Lancaster

January 2012

Data in this report is the latest available at the time of preparation and may not be for the current year.

This report provides a comprehensive overview of trends and developments in Kosovo's telecommunications market. The report analyses the mobile, Internet, broadband, digital TV and converging media sectors. Subjects include:

• Market and industry analyses, trends and developments;
• Facts, figures and statistics;
• Industry and regulatory issues;
• Infrastructure;
• Major players, revenues, subscribers, ARPU, MoU;
• Broadband;
• Mobile voice and data markets;
• Broadband (FttH, DSL, cable TV, wireless);
• Broadband market forecasts for selective years to 2020.

Key developments:

Mobile subscriber base climbing steadily; government's privatisation of PTK put off to later in 2012 following corruption charges against PTK management; telecom sector revenue showed slight growth in 2011, expected to continue into 2012; continuing economic strain leads to dramatic fall in telecom investment in 2011 - mobile sector accounting for almost a quarter of investment.

Companies covered in this report include:

PTK, IPKO, Artmotion, Kujtesa; Dukagjini Telecommunications, Dardafon.

This report is essential reading for those needing high level strategic information and objective analysis on the telecom sector in Iceland. It provides further information on:

• Market liberalisation and regulatory issues;
• The impact of the global economic crisis;
• Telecoms operators - privatisation, acquisitions, new licences;
• Mobile data market developments in coming years in light of spectrum auctions and new license awards in 2010;
• 3G developments, regulatory issues and technologies including HSPA and LTE;
• Broadband migration to an FttH architecture;
• Historical and current subscriber statistics and forecasts;
• ARPU statistics and forecasts.

Table of Contents

1. Executive summary

2. Key statistics

• 2.1 Country overview

3. Telecommunications market

• 3.1 Overview of Kosovo's telecom market

4. Regulatory environment

• 4.1 Regulatory authorities
• 4.2 Telecom sector liberalisation in Kosovo
• 4.3 Privatisation
• 4.4 Interconnect
• 4.5 Access
• 4.6 Number portability (NP)

5. Fixed network operators in Kosovo

• 5.1 Post and Telecom of Kosovo (PTK)
• 5.2 IPKO
• 5.3 Kujtesa
• 5.4 Kone

6. Telecommunications infrastructure

7. Broadband market

• 7.1 Overview
  • 7.1.1 Broadband statistics
• 7.2 Asymmetric Digital Subscriber Line (ADSL)
• 7.3 Cable broadband
• 7.4 Wireless broadband

8. Digital media

• 8.1 Overview of broadcasting market
• 8.2 Cable TV

9. Mobile communications

• 9.1 Overview of Kosovo's mobile market
  • 9.1.1 Mobile statistics
• 9.2 Regulatory issues
  • 9.2.1 First mobile licence
  • 9.2.2 Second mobile licence
  • 9.2.3 Third mobile licence
  • 9.2.4 MVNO Framework
  • 9.2.5 Mobile number portability (MNP)
• 9.3 Mobile technologies
  • 9.3.1 Digital
• 9.4 Major mobile operators
  • 9.4.1 Vala
  • 9.4.2 IPKO
  • 9.4.3 Mobile Virtual Network Operators (MVNO)
• 9.5 Mobile voice services
  • 9.5.1 Prepaid
• 9.6 Mobile data services
  • 9.6.1 Short Message Service (SMS)/Multimedia Messaging Service (MMS)
  • 9.6.2 General Packet Radio Service (GPRS)

10. Forecasts - fixed broadband subscribers - 2010 - 2013; 2020

• 10.1 Scenario 1 - higher broadband subscriber growth
• 10.2 Scenario 2 - lower broadband subscriber growth
• 10.3 Notes on scenario forecasts

11. Related reports

• Table 1 - Country statistics Kosovo - 2011
• Table 2 - Telephone network statistics - 2011
• Table 3 - Internet user statistics - 2011
• Table 4 - Internet user statistics - 2011
• Table 5 - Broadband statistics - 2011
• Table 6 - Mobile statistics - 2011
• Table 7 - National telecommunications authority
• Table 8 - Telecom revenue by sector - 2010 - 2011
• Table 9 - PTK financial data - 2007 - 2010
• Table 10 - IPKO fixed-line and mobile subscribers - 2010 - 2011
• Table 11 - Fixed lines in service and teledensity - 2004 - 2011
• Table 12 - Fixed broadband subscribers and penetration rate - 2006 - 2012
• Table 13 - Internet users - 2007 - 2012
• Table 14 - IPKO broadband subscribers - 2006 - 2009
• Table 15 - Broadband market share by operator - 2010 - 2011
• Table 16 - Broadband subscribers by operator - 2007 - 2011
• Table 17 - Broadband market share by platform - 2007 - 2011
• Table 18 - DSL broadband subscribers - 2007 - 2011
• Table 19 - Cable broadband subscribers - 2007 - 2011
• Table 20 - Wireless broadband subscribers - 2007 - 2011
• Table 21 - Mobile subscribers and penetration rate - 2004 - 2012
• Table 22 - Mobile market share by subscribers - 2004 - 2011
• Table 23 - Mobile market revenue - 2008 - 2011
• Table 24 - Vala subscribers - 2008 - 2010
• Table 25 - Vala mobile revenue - 2007 - 2010
• Table 26 - Prepaid as proportion of total mobile subscribers - 2008 - 2011
• Table 27 - Vala SMS volume - 2009 - 2010
• Table 28 - Forecast broadband subscribers - higher growth scenario - 2010 - 2013; 2020
• Table 29 - Forecast broadband subscribers - lower growth scenario - 2010 - 2013; 2020

• Chart 1 - Telecom revenue by sector - 2010 - 2011
• Chart 2 - PTK financial data - 2007 - 2010
• Chart 3 - Mobile subscribers and penetration rate - 2004 - 2012

• Exhibit 1 - Access, the local loop and unbundling - an overview