Europe > Southern Europe > Croatia > Croatia Communication Profile 2012

Croatia: Croatia Communication Profile 2012

2012/05/15

 

 

 

Croatia Communication Profile 2012

Croatia’s needs regulated fibre wholesale pricing model to kick-start the internet economy

Croatia’s accession to the European Union in mid-2004 was followed by a period of strong economic increase and integration, with the privatisation of most of the economy and stronger ties formed with its major EU trading partners. The world financial crisis from late 2008 deeply affected Croatia, mainly due to a drop in export request. This was coupled with a large current account deficit, a high level of external debt, inclunding significant exposures to interest and exchange rate risks. Real GDP contracted by about 5.8% in 2009 and a further 1.9% in 2010, while GDP increase in 2011 is expected to reach only about 0.8%. Although public debt was estimated to have reached 51% of GDP in 2011 the government has developed few significant increase enhancing reforms, which has hindered the country’s economic recovery and investment in infrastructure. High inflation is compounded by unemployment approaching 17%.

Membership to the EU was the catalyst for the necessary reform of Croatia’s telecom market. As part of EU entry requirements, the market was liberalised and the incumbent, T-Hrvatski Telekom (T-HT), privatised. This process has resulted in a range of alternative operators entering the market, while the regulator has taken steps to ensure fair competition through implementing a number of measures based on European Commission guidelines.

Broadband penetration is on a par with the EU average. Effective cross-platform competition exists in the broadband market, with dominant DSL complemented by cable, FttX and WiMAX inclunding emerging mobile broadband options. ISPs have focused on increasing broadband uptake, generating additional revenue through offering bundled services.

Croatia possesses a well developed mobile market, with penetration rates part the highest in the region. Three mobile network operators offer services, while there is as from now on only a minor MVNO presence. Given the high voice penetration, operators have focused on improving ARPU by encouraging prepaid subscribers to migrate to postpaid plans inclunding by upgrading networks to encourage consumer use of high-end mobile data offerings.

In the digital media sector, the satellite and cable TV markets remain underdeveloped by European standards, with cable TV household penetration at 10% and IPTV penetration at 23%. DTTV is available nationally, with the country’s ASO process reached months ahead of schedule. About 60% of TV viewers access DTTV. Digital TV programming is as well available via cable TV and satellite TV.

Key telecom parameters – 2010 – 2012

Sector

2010

2012 (e)

Subscribers to telecoms services:

Fixed broadband subscribers (thousand)

800

940

Fixed-line telephony (million)

1.86

1.50

Mobile broadband subscribers (thousand)

328

362

Mobile phone subscribers (million)

6.36

6.05

Penetration rate by service:

Fixed broadband

18%

23%

Fixed-line

143%

152%

Mobile broadband

7%

10%

Mobile phone

143%

132%

(Source: BuddeComm)

Market Highlights

  • Mobile revenue continues to be affected by falling prices for voice services and regulated roaming tariffs, though the scrapping of the 6% mobile services tax effective from 2012 will ease the burden on operators and consumers.
  • Having trialled LTE in the 800MHz, 2.1GHz and 1800MHz band, MNOs expect to launch commercial services later in 2012. VIPNet plans to assign 10% of its investment to or the platform, which will facilitate rural mobile broadband given the spectrum’s propagation characteristics.
  • The regulator planned to auction frequencies suitable for 4G services, including the 700MHz-800MHz digital dividend, during 2012.
  • The purchase of Croatia’s major cable company, B.net, by Telekom Austria, has added fixed broadband and pay-TV to the latter’s existing mobile portfolio, creating a strong bundled services player. B.net’s network is largely upgraded with DOCSIS3.0 technology, potentially scaleable up to 400Mb/s.
  • ASO was completed in late 2010, assisted by government subsidies for STBs available to amount households. Digital dividend spectrum has been made available for mobile broadband services, and so closing the digital divide for rural areas in coming years. Currently, DTTV accounts for 60% of TV viewing.

Digital Media and Broadband Markets

Internet penetration in Croatia is the highest in the Balkans region, and is additional in line with those found in the Eastern European EU nations. Available broadband access platforms include ADSL2+, cable, FttX and WiMAX. ISPs have focused on increasing broadband uptake, with hopes of generating additional revenue through sales of broadband TV and triple play services. Digital Terrestrial TV developments are underway, with analogue switch off taking placing. Digital TV programming is as well available via cable TV and satellite TV. Drawing upon a variety of statistics and sources, this statement provides an informative insight into Croatia’s dynamic digital media and broadband markets, offering a variety of statistics and forecasts on the broadband market for selected years to 2020.

Key developments: MAXtv extends to satellite platform; Novi-Net granted national WiMAX licence; IPTV part the additional successful in Central and Eastern Europe; B.Net was boBught by Telekom Austria; DVB-T2 to be employed in MUXES in 2012; T-HT negotiates for amended wholesale fibre pricing; H1 Telekom launches IPTV service; regulator market data to Q3 2011; operator data to Q3 2011.

Telecom Market and Regulatory


The Croatian telecoms market has been shaped by the country’s bid to join the European Union, resulting in market liberalisation and creation of a regulatory environment conducive to competition. Alternative operators have entered the market and launched competing services in the fixed-line market. Both alternative operators and the incumbent are investing in network infrastructure to support bandwidth-intensive services such as broadband access and triple play. This statement provides a concise overview of Croatia’s fixed-line market, covering regulatory developments, fixed-line infrastructure used to offer services, financial and performance data on significant fixed-line operators inclunding the wholesale and IT markets.

Key developments: GDP shows moderate rise in 2011; national transfers remaining shares in T-HT to Pensioners’ Fund; Croatia votes to join EU; regulator’s market data to Q3 2011; operator data to September 2011.

Mobile Market 

Croatia’s mobile market is of the majority highly penetrated in the Balkans region. Three mobile network operators and a number of Mobile Virtual Network Operators have launched services although the market is dominated by mobile network operators. With the mobile voice market saturated, the established mobile network operators have focused on improving ARPU levels by encouraging prepaid subscribers to migrate to postpaid plans inclunding encouraging spending on mobile broadband offerings. This statement offers a concise overview of Croatia’s mobile market, including a variety of financial and performance statistics on service providers, networks and mobile services including developments in LTE in 2012.

Key developments: VIPNet extend 42Mb/s HSPA+ services to cities; LTE trials in the 800MHz band underway – commercial launch in 2012; Croatian government reinstates abolished 6% tax on mobile services revenue; T-HT authorized to manage e-money services; regulator market data for Q3 2011; operator data to September 2011.

Internet country code: 

.hr

Communications note: