Global Insight Perspective | |
Significance | Eventis and Moldtelecom will join dominant players Orange and Moldcell on the country's 3G market. |
Implications | With penetration above 50%, three GSM operators on the market, foreign investment, and now 3G licences granted to all major players, the market is showing signs of growing maturity. |
Outlook | These indicators of market maturity are typical of many of the Commonwealth of Independent States countries. The introduction of 3G services reflects the fact that operators will increasingly focus on service usage and ARPU levels as this maturation continues. |
Licences to offer 3G services in Moldova have been awarded to Eventis Mobile and Moldtelecom. Each operator is to pay US$8 million, and under the licence terms they must launch services no later than 1 August 2009. Each must have network coverage across the capital (Chisinau) and Balti within a year; across the cities of Comrat and district centres of Cahul, Orhei, Ungheni, and Soroka within two years; and across 29 regional centres within three years. After three years each operator must offer full network coverage across the entire territory of the country.
Outlook and Implications
Orange and Moldcell Likely to Lead 3G Market: In 2008, 3G licences in Moldova were awarded to France Telecom's Orange, and Moldcell, owned by the TeliaSonera-Turkcell vehicle Moldcell (see Moldova: 15 September 2008: Moldcell Becomes Moldova's Second 3G Licence holder). Orange is the subscriber market leader, with around a two-thirds market share, while Moldcell is well established as the second-largest player. Eventis only entered the GSM market in late 2007, and Moldtelecom, which operates in the mobile sphere under the brand name "Unite", is a CDMA operator. IHS Global Insight expects that the general mobile subscriber trends are likely to be replicated in the 3G market. Orange and Moldcell are likely to lead the way in the 3G market, because of the fact that they were awarded licences first and have therefore been able to launch services before their rivals and also because they will be able to appeal to their larger existing subscriber bases when advertising 3G services. Even aside from the dynamics of market competition in the sector, uptake of 3G services is likely to be a fairly slow process, as it is targeted at a smaller band of higher end subscribers.
Maturation of Moldovan Market Reflects Commonwealth of Independent States (CIS) Trend: Although uptake of 3G services is likely to occur at a sedate pace, the awarding of licences is indicative of a gradual maturation of the Moldovan mobile market. During the course of 2008 penetration rose to more than 50%, and the presence of a third established GSM operator and several 3G licence holders reflects a healthy market. The sector is also benefiting from the expertise and financial strength of established foreign players, in the form of France Telecom, TeliaSonera, and Turkcell. Indeed, these factors—competition, 3G licence holders, and foreign investment—are increasingly emerging across the entire CIS region, as mobile markets mature throughout the former Soviet Union. Licences for 3G provision were recently awarded in Armenia, which also recently gained a third GSM operator, while in Azerbaijan, Belarus, and Kazakhstan 3G licensing has been slated for 2009, with each market also now boasting a third GSM operator (see Armenia: 1 October 2008: Armentel Launches Armenia's First 3G Network, Azerbaijan: 3 September 2008: Mobile Operators in Azerbaijan Studying Market Feasibility of 3G Services, and Belarus: 4 December 2008: Minister Assures Belarusian 3G Services Will Be Launched During 2009). It is therefore understandable that these markets have attracted investment from the likes of Mobile TeleSystems and VimpelCom in Russia, Turkey's Turkcell, and Sweden's TeliaSonera. Although there remains room for further growth in these markets in the short term, the introduction of 3G services reflects the fact that operators will increasingly focus on service usage and ARPU levels, rather than subscriber uptake, in the long term.