KPN launches 3G to consumers

12 Oct 2004

Dutch cellco KPN Mobile yesterday launched third generation (3G) mobile services to consumers, three months after rolling out the offering to business users. The company claims its 3G network currently covers 50% of the Netherlands’ main cities, and that it expects it to be available to 40% of the Dutch population by the end of 2004. Customers currently have just one handset at their disposal, the SonyEricsson Z1010, which it is retailing at EUR219 in combination with an UMTS subscription.

KPN shares the Dutch mobile market with four other network operators – Vodafone, Telfort (formerly O2), Orange and T-Mobile – plus two newly established MVNOs, Tele2 Mobiel and Scarlet Telecom. The highly saturated 2G services market has seen several of the operators suffer a drop in customer numbers at certain points over the last few years, although all managed to bounce back in 2003, and by the end of June 2004 there were 14.478 million mobile subscribers in the country, up from 11.95 million at the end of 2002, a penetration rate of 88.9%. KPN’s market share stood at 37.3% at the same date, down from just over 50% at the end of 1999. Its nearest competitor Vodafone has also seen its market share fall over the same period, losing more than seven percentage points to stand at 23.8%. The other three network operators, meanwhile, have had better fortune, with T-Mobile adding 10% to its market share in just over four years to end the period with 15.4%, while Telfort and Orange have each added around five percentage points to reach 12.8% and 10.7% respectively.

All five main operators hold 3G licences, having received their 15-year concessions in July 2000. The licence terms required them to provide coverage of 12% of the population by 1 April 2004 and 60% by the beginning of 2007. However, during 2001 concerns began to grow that the effects of the global slowdown and the cooling of sentiment towards 3G services could affect the long-term stability of the industry, and in August that year the Dutch labour unions asked the government to take steps to stimulate investment in 3G. OPTA, the NMa and the Ministry of Economic Affairs agreed to allow network sharing with the aim of reducing costs and providing a more rapid rollout, and in November 2001 KPN Mobile signed a MoU with Telfort with the aim of building a 3G network together, though they shelved their plans in February 2003. Meanwhile, in May 2002, T-Mobile and Orange set up a 50/50 joint venture under the banner RANN for the joint rollout of their 3G networks. The two cellcos will keep independent control of their networks but will cooperate with the rollout of the radio access network and the core operations and maintenance centre. Vodafone has not revealed any plans for 3G network sharing.

PriMetrica’s GlobalComms Database

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