In this presentation we show our analysis of revenue growth trends for mobile operators in the top five European markets (UK, Germany, France, Italy and Spain). The historical analysis is based on the published results of the operators, although they include our estimates where their data is inconsistent or not complete. A copy of the underlying data in spreadsheet format is available to our subscription clients on request

Vodafone Europe’s service revenue growth improved marginally in the September quarter, a very solid performance under tricky circumstances, helped by good competitive performances and judicious pricing measures

The combined Europe and group common function EBITDA margin was again held flat, despite continued smartphone adoption pushing up handset costs, with strong cost control again evident

Pricing, competitive, regulatory and cost trends are all going well; but macroeconomic trends are clearly not, and are likely to make an acceleration in the second half of the year very difficult

In this presentation we show our analysis of revenue growth trends for mobile operators in the top five European markets (UK, Germany, France, Italy and Spain). The historical analysis is based on the published results of the operators, although they include our estimates where their data is inconsistent or not complete. A copy of the underlying data in spreadsheet format is available to our subscription clients on request

After strong underlying improvements in growth and profitability in 2010, in H1 2011 H3G Europe’s service revenue growth was steady at 3% and margins only slightly improved to (underlying) EBIT breakeven

In the UK, service revenue growth accelerated to 7% (from -1% in H2 2010), with EBIT maintained at about breakeven, as the UK company’s ongoing strong contract subscriber growth fed through

Italy suffered roughly the opposite fate, with service revenue growth falling to -8%, as its recent subscriber losses fed through, and EBIT remained firmly negative

Vodafone Europe’s service revenue growth dropped by 0.5ppts to -1.3% in the June quarter, although most of this was due to a sharp MTR cut in the UK

Revenue in Spain was very weak due to a price re-adjustment, but trends elsewhere were broadly positive, with voice minutes growth improving overall

Medium term prospects are good, with MTR cuts fading, competitive performance improving and data growth likely to re-accelerate, but we expect declining growth in Turkey to drive a worse performance in the short term

BT’s plans to deploy next generation access, combined with state-aided rural broadband projects, look set to give almost three quarters of UK households access to high speed broadband by 2016

New wireless technology is a feasible substitute for wireline for some low-end users and in specific areas, but we do not expect it to have a major impact on high speed broadband deployment

BT Retail and Virgin Media will in effect move significant numbers of their customers onto high speed broadband, but without significant price reductions we believe that, even by 2016, consumers’ reluctance to pay more will result in two-thirds of households remaining on lower speed options

In this presentation we show our analysis of trends in UK broadband and telephony to March 2011, based on the published results of the major service providers. This quarter’s edition includes an updated outlook for broadband market subscribers and market shares to 2015.

Highlights in the quarter included broadband market growth moving back into line with consumer confidence, continuing strong broadband subscriber growth at both BT Retail and Sky, greater stability in the proportion of the market served by BT Wholesale and a significant price increase at O2. We project that, by the end of 2015, about 21 million households will subscribe to fixed broadband, and that Sky’s market share will exceed that of TalkTalk Group to rival that of Virgin Media.

The most dramatic observation from our survey is the surge in mobile data service usage: 48% of UK mobile users now use a data service at least once a month, up from just 30% last year. This increase is substantially all from the increased number of internet-centric smartphones (i.e. iPhone, BlackBerry and Android handsets) in the base

The internet-centric smartphones themselves had substantially no reduction in data usage penetration rates (all at 90%+) despite their volumes surging, with users from all age and socio-economic groups using them for data services. Data service usage penetration on a daily basis actually increased for Android and BlackBerry handsets

This supports our view that it is the nature of these handsets in terms of their ease-of-use for data services that is driving overall usage, and that overall data usage will continue to surge as they continue to diffuse through the subscriber base

In this presentation we show our analysis of revenue growth trends for mobile operators in the top five European markets (UK, Germany, France, Italy and Spain). The historical analysis is based on the published results of the operators, although they include our estimates where their data is inconsistent or not complete.

Vodafone Europe’s service revenue growth dipped by 1ppt in the March 2011 quarter, but nearly all of this was due to regulated MTR cuts, with its competitive performance actually improving again

The combined Europe and common cost EBITDA margin was actually held flat in H2 10/11 on H2 09/10, aided by some heroic (and, frankly, uncharacteristic) cost cutting efforts, with Vodafone’s cost profligacy days apparently behind it

The outlook for next quarter is poor due to the UK MTR cut, but we then expect revenue growth to steadily improve for the rest of the year, with smartphone-driven data growth a help rather than a hindrance