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Mobile Tariff Price Cuts Drive Bullish Growth in Germany
Growth in the German mobile market shows little sign of abating despite penetration reaching 127.5% at the end of Q3. Quarterly net additions stood at 2.51m, up from 2.33m in Q3 07, while annual net additions reached 12.53m - the highest figure for almost seven years. In proportionate terms, annual growth stood at 13.6%, up 1.1pp compared to the prior twelve months. Q3 was the fourth successive quarter to see annual growth in excess of 13%, a feat not achieved since the heady days of 2001.
At the end of the quarter, there were nigh on 105 million mobile connections in Germany.
Market leader T-Mobile finished the quarter with 38.80m customers having recorded 0.40m quarterly net additions, the worst figure in the market. This was the second successive Q3 in which T-Mobile finished bottom, although the Q3 08 figure was at least substantially higher than the 0.14m recorded in Q3 07. High churn was at the root of both of these figures, with a rate of 1.5% in Q3 07 and 1.2% in Q3 08, double that of the previous quarter. The poor performance saw T-Mobile's market share drop to 37.0%, the lowest level it has ever recorded. It is in little danger of ceding first place, however, with second-placed Vodafone losing 0.7pp of market share annually to finish Q3 on 34.5%. In real terms, Vodafone had 36.19m customers at the end of the quarter. It led the market for quarterly net additions for the second successive Q3 with a figure of 0.90m.
E-Plus continued to lead the market in terms of proportionate growth with an annual gain of 20.7%, compared to 14.9% for O2, 12.6% for T-Mobile and 11.2% for Vodafone. Accordingly, it saw a 0.9pp gain in market share to 15.2%. In real terms it finished the quarter on 16.01m, more than 20m behind Vodafone but more than 2m ahead of fourth-placed O2 (13.98m). O2 does lead the market in some respects, however: it had the highest proportion of contract customers with a figure of 49.2%, 5.5pp ahead of the next best, Vodafone; and it also maintained the highest ARPU figure with a quarterly average of €17.30 a month. However, this represented a 16.8% year-on-year decline, and there were double-digit drops across the market. This points to price reductions at all four operators, which explains why growth remains at the highest level in Western Europe.
Posted to the site on 9th January 2009
This article was extracted from The Mobile World Briefing, the weekly newsletter from The Mobile World.
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