Telecommunications

Market

The following comes directly from a report put together by Maria Kowalska (Please see endnote).

"The telecommunications market in Poland will become fully liberalized at the beginning of 2003. At that time, Telekomunikacja Polska S.A., the national telecom operator, will lose its monopoly for international voice services, the last segment of the telecommunications services protected against competition. A recent report on Internet services contains information on data transmission networks in Poland.

TPSA, the dominant operator, provides approximately 94% of all fixed-line telecommunications services and owns most of the infrastructure. Three independent domestic long-distance telephone operators (NOM, Netia and Energis) have only marginal market shares and offer services only to clients who pre-subscribe to their services. Out of over 50 licensed local telephone operators, only approximately 20 actually are active in business, serving a total of approximately 1,000,000 subsribers. Netia and Telefonia Lokalna with its Dialog network are the most significant ones. Because the Polish telecommunications market began to open up only in 1990s, emerging operators invested in the latest digital technologies and laid out fiber cables. This today, they and are in position to offer enhanced services to their subscribers.

The traditional fixed-line telecommunications sector has lately been experiencing serious problems. Most independent telecommunications operators are faced with serious financial difficulties. Moreover, existing telephone operators have had problems with negotiating interconnection agreements with TPSA. As a result, their investments in infrastructure have substantially decreased.

Cellular operators are Polska Telefonia Cyfrowa operating Era GSM network, Polcomtel operating Plus GSM network and Polska Telefonia Komorkowa Centertel operating Idea network, all three holding GSM 900, DCS 1800 and UMTS licenses. UMTS services are expected to be launched in 2005. The cellular market is competitive and is growing fast. There are close to 11 million users of cell phones, matching fixed-line subscriber rates.

As a result of a lack of competition in fixed-telephony, the cost of telephone connections in Poland remain one of the highest in Europe. For example, current rates for a connection to the U.S. costs $0.86 (zl 3.46) per minute which is three times higher than from the Czech Republic or four times more than from Greece. TPSA has just recently announced a plan to substantially reduce rates for international calls. It is expected that TPSA prices will fall by approximately 20%.

Voice over Internet (VoIP) technology has become quite popular in Poland as a way to provide voice services to customers at lower costs. The actual size of VoIP in the telecommunications market is very difficult to assess. This service is provided by a large number of small, often local service providers. The statistics are hard to come by. An indication of VoIP market size might come from the measurable decrease in TPSAs international traffic. TPSA observed that the total length of international calls decreased from 495 million minutes in 2000 to 455 million minutes in 2001. Also, TPSAs income from international calls in 2001 was $185 million in 2001, some $10 million less than in 2000.

Industry sources estimate that VoIP already represents between 2 and 15% of international voice services, depending on the direction. VoIP services are the most popular in connections with the United States. One of the local operators estimates the current VoIP market at $15 million with strong indications of future growth.

2001 2002* 2003*

Total size of Polish Telecommunications market $9.4bln $9.66bln $9.8bln

VoIP market $62.5mln $65.5mln $73mln

Fixed-line telephone density (No of phones per 100 inhabitants) 30 31 32

No. of fixed-line telephones 11.5mln 11.8mln 12.2mln

Number of cellular phone users 10mln 11.5mln 13.2mln

Also, telecommunications carriers use Internet Protocol technology for routing their voice traffic although the actual size of this technology is very hard to estimate.

Most market players are getting ready for the 2003 opening of the market by extending their full telecommunications offer including VoIP services. Since the beginning of 2002, URTP has registered over 20 new service providers, including 3 virtual mobile operators.

Industry sources estimate that the VoIP services in international outgoing traffic will increase from 50,000 minutes in 2002 to 65 thousand in 2003 and close to 90 thousand in 2004. International incoming VoIP traffic is estimated at close to 800 thousand minutes in 2002 and is expected to increase to 870 thousand in 2003 and approximately 960 thousand minutes in 2004.

Per the estimates of Gartner Group, in 2003-2005 most analog PBXs (private branch exchanges) in Poland will be replaced with equipment based on Internet protocols." (1)

Mobile Telephony

"The mobile telephony market has three major phone network operators in Poland: Centertel, belonging to TP S.A. capital group, Polkomtel S.A. and Polska Telefonia Cyfrowa S.A. These three mobile phone networks account for more than 11 million customers, already accounting for more users of fixed telephone lines. It is predicted that by the end of 2005, every other Pole will have his or her own mobile phone." (2) "The number of Poles with mobile phones in 2002 reached the 11.5 million mark, and is projected to be as many as 13.2 million by the end of 2003." (3)

SOURCES

Top of page