bulgaria:how technology ict evolution toward market competition

Bulgaria: How technology ICT evolution

toward market competition

Simeon Arnaudov Professor SeungHyun Kim 463.541Technology Industry organization TEMEP, Seoul National University 2012.05.12

Study problem

How technology ICT evolution toward market competition. In other words how communication companies using ICT technologies are maximizing their company profit.

Simeon Arnaudov Professor SeungHyun Kim 463.541Technology Industry organization TEMEP, Seoul National University 2012.05.12

Market overview

TV and radio

10.3%

Internet access

10.1% E-commerce

5.6%

TR= € 1,61 billion

Source: Arc fund; Capital newspaper; CRC

Communication

74%

History of telecommunication industry

1. Market Evolution

1992

NMTi 450

1995

GSM 2G

Time

2005

GSM 3G

2012

LTE

Low

co

mp

etit

ion

Tech

no

logy

2011

GSM 2G

Virtual operator Monopoly

market 1995

Duopoly market 2001

Oligopoly market 2005


2. Nordic Mobile Telecommunication

• Est. 1992

• Brand name: Mobikom

• Technology: NMTi 450 (voice); POCSAG 1200 (pager).

• Data transfer speed 1200 bps

Core technology developer (Alcatel and Ericsson)

• Frequency: 450MHz;

• Mobile services: Voice, text, VoIP

• Technology upgrade (2003): CDMA 450 (CDMA one (2G))

Core technology developer Huawei (China)

• Close down 2007

• Free frequency 420 – 460 MHz

1992

NMTi 450

Simeon Arnaudov

Professor SeungHyun Kim

463.541Technology Industry organization

TEMEP, Seoul National University

2012.05.12


3. Global Service for Mobile

Telecommunication (GSM)

• Est. first GSM network 1995

• Brand names: Mobiltel (since 1995); Global (since 2001); Vivacom (since 2005); Bob (2011) – first virtual operator

1992

NMTi 450

GSM 2G

3G

LTE

Core technology: Ericsson;

2G (1995)

EDGE

UMTS (2005)

----

HSDPA (2009)

HSPA+ (2011)

LTE (1800MHz - Ericsson)

Core technology: Motorola;

Ericsson; Huawei

2G (2001)

----

UMTS (2005)

HSUPA (2006)

HSDPA (2009)

----

Planning to launch LTE 2012

Core technology: Ericsson;

Huawei; Nokia

2G (2005)

----

UMTS (2005)

-----

HSDPA (2009)

----

N/A launch LTE about

Virtual network

2G

UMTS

HSDPA

Mobile communication market

1. Market share / number of customers The survey does not include information for Virtual operator Bob

Source: investor.bg

2. Revenue/ Customers/ Market

Post pay 52%

Pre pay 48%

Subscribers: 5 400 000

Revenue: € 614,7 (2009)

Net profit: € 147 (2009)

Mobile broadband: 70,9% up

Wire broadband: 33,8% up

Subscribers: 2% down

Mobile communication market cont.

144%

subscribers

91% of

population has

mobile phone

€ 0,063

termination

price (2012)


Revenue: € 423 (2010)

Net profit: N/A


Revenue: € 515 (2005) include

all company branches

Mobile

broadband

(fast increase) 99,98%

territory

penetration

98,92%

population

penetration

Subscribers: 15 000

Mobile communication market

3. Mobile broadband

Total number of mobile phones 8 500 000

Total number of smart mobile phones 1 024 000

android

iOS

RiM

W8

Bada

Linux

Maemo

Palm

Symbian

65.8%

15.2%

8.5%

4.8%

4.5% 1.1%


Wireless and wired broadband access

TR= € 340 million (2011)

TR= € 185 million Home internet access

TR= € 87 million Mobile internet access

TR= € 48 million Business internet access


Internet access

Source: Foundation ARC, 2012

Simeon Arnaudov




2012.05.12

Internet access 1. Internet users (in million)

1.17

1.32

1.44 0.64

Home Internet access

2011.01 2012.01 2011.01 2011.01

Cable TV Satellite TV

2. Used technology (broadband only)

50%

LAN

31%

ADSL

13%

CaTV 23% broadband

54% Internet access


Regulation

Communication regulation commission - implements the state sector policy in the field of telecommunications and postal services.

Law of electronic messages

Licensing mobile operators

No barrier to enter ISP market

Simeon Arnaudov




2012.05.12

Conclusion

new ICT technologies give opportunity to communication companies to do services diversification

High barrier to enter Mobile communication market Low barrier to enter Internet service provider market Mobile communication market is highly saturated and

it is difficult to gain profit, so companies are introducing new strategies with adding new services (as mobile internet; IPTV; fixed home phone; attracting customers to move from pre pay to post pay mobile services)

Mobile regulation give high bureaucracy

References

• ARC fund: http://www.arcfund.net/ • http://www.capital.bg/biznes/kompanii/2012/04/27/1816434_goliamata_kabelna

_razprodajba/?sp=1#storystart • http://www.mtel.bg/lte • http://www.globul.bg/bg/map.html • http://www.vivacom.bg/bg/residential/about_us/company_information • http://www.maxtelecom.bg/bg/devices/wimax-wifi-3.html • http://www.dnevnik.bg/tehnologii/2010/10/18/978390_bulgariia_e_chetvurta_po

_kachestvo_na_internet_v_sveta/ • http://www.capital.bg/biznes/kompanii/2012/04/27/1816537_pruv_sred_neravni

/ • http://hardwarebg.com/forum/archive/index.php/t-89382.html • http://en.wikipedia.org/wiki/GLOBUL • http://www.standartnews.com/biznes/mtel_otchita_709_rast_na_klientite_na_int

ernet-148150.html • http://blog.mobikom.bg/2012/05/radio-telecommunications-company.html

http://hardwarebg.com/forum/archive/index.php/t-89382.html



































http://en.wikipedia.org/wiki/GLOBUL

http://en.wikipedia.org/wiki/GLOBUL

http://www.standartnews.com/biznes/mtel_otchita_709_rast_na_klientite_na_internet-148150.html





http://blog.mobikom.bg/2012/05/radio-telecommunications-company.html




