Report On The Telecoms Market in Poland 2011

+
Report on the telecommunications market in

Poland in 2011
The President of
the Office of Electronic Communications
Warsaw, June 2012
1
1. Preface ....................................................................................................................... 3
2. Internet access .......................................................................................................... 6
2.1. Retail market ...................................................................................................... 6
2.1.1. Characteristics of the Internet access market ............................................... 6
2.1.2. Users ................................................................................................................... 8
2.1.3. Revenues .......................................................................................................... 10
2.1.4. Internet access technologies ......................................................................... 12
2.1.5. Bandwidth ......................................................................................................... 15
2.1.6. Prices for broadband access services ......................................................... 16
2.1.7. Bundled services market ................................................................................ 19
2.2. Wholesale market ............................................................................................ 20
2.2.1. The service of wholesale bitstream access (BSA) ..................................... 21
2.2.2. The service of wholesale access to the local subscriber loop (LLU) ...... 21
3. Mobile telephony ..................................................................................................... 22
3.1. Retail market .................................................................................................... 22
3.1.1. Characteristics of the mobile telephony market .......................................... 22
3.1.2. Revenues .......................................................................................................... 24
3.1.3. Client structure ................................................................................................. 24
3.1.4. Shares of the operators .................................................................................. 25
3.1.5. Service volumes............................................................................................... 27
3.1.6. Number portability ........................................................................................... 31
3.1.7. Prices for mobile telephony services ............................................................ 32
3.2. Roaming ............................................................................................................ 35
3.2.1. Characteristics of the roaming market ......................................................... 35
3.2.2. Prices for roaming services ............................................................................ 37
4. Fixed-line telephony ............................................................................................... 42
4.1. Retail market .................................................................................................... 42
4.1.1. Characteristics of the fixed-line telephony market ..................................... 42
4.1.2. Revenues .......................................................................................................... 44
4.1.3. Traffic volume ................................................................................................... 45
4.1.4. Shares of TP and AO ...................................................................................... 47
4.1.5. Number portability ........................................................................................... 50
4.1.6. VoIP ................................................................................................................... 50
4.1.7. Prices for fixed-line telephony services ........................................................ 52
5. Investments.............................................................................................................. 58
6. Prospects for market development ...................................................................... 60
7. List of figures and tables ........................................................................................ 62
8. Glossary of terms .................................................................................................... 64
2
1. Preface
In 2011, the value of the telecommunications market amounted to nearly PLN 43
billion1, and was higher by 1.1% in comparison to the previous year. The volume of
retail sales of the three major market segments - Internet access, mobile telephony
and fixed-line telephony - reached the level of approximately PLN 28.3 billion. The
small change of the rate resulted from the continued, long-standing downward trend
for voice call services at a fixed location, which was compensated by development of
the other two segments to a limited extent.
At the present moment, the Polish telecommunications market is relatively saturated,
resulting in a slower growth in the number of new users of telecommunications
services.
Revenues across the industry are determined by profound changes in the patterns of
consumption, ways to provide services and processes of fixed-to-mobile substitution.
The expansion of data transmission services also plays an important role.
One of important trends on the Polish telecommunications market is further
consolidation of the telecommunications industry.
Other trends, evident for several years, include among others: falling prices, sales of
bundled services, continuing depreciation of the fixed-line telephony market, growing
number of broadband lines, and debuts of successive MVNOs.
The development of competition has opened to the user the prospect of selection of
an offer accommodated to individual needs. This has stimulated growth in the use of
telecommunications services, particularly in the segments of mobile telephony and
Internet access.
The leader of the mobile telephony market in terms of increased revenues in 2011
was P4 (over 49% increase compared to 2010), the second was PTK Centertel
earning only 1% more than last year.
The volumes of all mobile services increased. The average total connection time per
user was longer by up to 270 minutes in comparison with the previous year. SMS
continued to be one of the most popular forms of communication in Poland. Last
year, there were over 51.6 billion messages sent in the country. A small growth rate
(0.4%) last year can be explained by high saturation of the mobile telephony market
and growing popularity of other forms of communication, such as MMS (up by 19%),
use of text messaging and e-mails sent from mobile phones. The highest increase in
popularity (by 97.3%) was reported by domestic mobile data transmission.
Due to the increasing prevalence of smart phones, mobile telephony operators
competed primarily on the Internet packages. There were available tariffs which
included Internet access in the subscription price, as well as promotional packages
for browsing different sites.
The average price for data transmission was lower by 11%, and the maximum price
by 50%, in comparison to 2010. The average price was by about 3% lower for voice
calls, while the price for SMS remained unchanged.
Despite a subsequent price reduction under the EU regulation on roaming, prices for
these services were still much higher than their national counterparts.
1
Throughout this document, unless otherwise indicated, all values are net.
3
The most spectacular move on the mobile telephony market in 2011 was the
purchase of Polkomtel by company Spartan Capital Holdings. An important event
was rebranding of PTC. Starting from 5 June 2011, the Era brand disappeared from
the Polish telecommunications market, and was replaced by T-Mobile.
Activities of market participants leading to lower operating costs, such as establishing
the Networks! company (joint venture of PTK Centertel and PTC) in July 2011, which
is to co-utilize their radio access networks, grow in significance. Its establishment will
result in a number of benefits to customers in the form of improved coverage and
network quality, as well as access to the latest technologies.
The battle for a customer and building a competitive advantage no longer relies
solely on cutting the prices. Other-than-cost factors become increasingly important
for the customers, like the connection speed for the Internet access. The number of
lines with speeds equal to or exceeding 2 Mb/s increased by 64.2%. At the same
time, the fall in prices of Internet access was propelled by cable TV providers, who
offered the subscribers more attractive tariffs than the operators of xDSL services. In
comparison to the European Union countries, the tariffs of Polish providers come out
well - in majority of cases their costs were lower than the average for individual
throughputs.
Bundling of services was an important trend, which allowed to meet the demand for
several telecommunications services to be purchased at significantly lower prices in
a bundle rather than separately. More than 2.6 million users benefited from this
option. The most popular were double-play offers, most often combining cable TV
with Internet access.
The increase in intensity of use of telecommunications services traditionally has not
concerned the fixed-line telephony. The statistics concerning the number of
subscribers, market value and traffic volumes have been dropping year by year. This
trend was exacerbated by the phenomenon of substitution of services at a fixed
location with the mobile telephony offers.
According to data gathered for the annual infrastructure inventory, investments in the
access network amounted to approximately PLN 980 million, while in the optical fibre
network to nearly PLN 83 million. The main part of these expenses (62.8%)
concerned the xDSL technology.
The subsequent parts of the document present the status and development of
various segments of the telecommunications market: Internet access, mobile and
fixed-line telephony. Special emphasis was placed on changes in retail prices of
services.
The report was prepared on the basis of information contained in the reports of the
telecommunications business for the year 2011 (database as of 30 May 2012),
provided in accordance with Article 7 of the Telecommunications Law by
telecommunications companies, as well as using the analytical resources held by the
Office of Electronic Communications.
4
Internet access
 In 2011, the number of new users of broadband services increased by over 1
million, while approximately 52.2% of them opted for mobile access.
 Penetration with mobile Internet increased by 17.2%, while for fixed-line
services the ratio was 10.8%.
 Main players in the segment were: TP S.A. and four infrastructural operators
(MNOs) – P4, PTK Centertel, Polkomtel, and PTC.
 The most popular access technology were 2G/3G modems, the importance of
cable TV and WLAN modems grew successively.
 Participation of lines with bandwidth exceeding or equal to 2 Mb/s increased
by 24.7 percentage points. Increasing the speed constituted a response to the
expectations of customers for whom this ratio was the most important criterion
of choice.
 Over 2.6 million persons used bundled telecommunications services, an
increase by 23.5% in comparison to 2010.
 Alternative operators (AO) developed their own telecommunications
infrastructure - its market share increased by 40.2%. Positive dynamics also
characterized LLU services (41%), while the share of BSA lines decreased by
7.6%.
Mobile telephony
 In 2011, over 50.1 million SIM cards were used, which meant a penetration at
the level of over 131.6%.
 There was a slight increase in the share of pre-paid service users, which
changed a trend observed throughout the years of reduction in the number of
pre-paid users over post-paid users.
 The majority (71%) of ported numbers in mobile networks concerned migration
to the Play network operator.
 The largest (by over 3.1 percentage points) increase in the market share in
terms of the number of users compared to the year 2010 was recorded by the
company P4. The market share of MVNOs once again did not exceed 1%.
 Average prices for domestic mobile services decreased by 2.8 % for voice
calls, 2.2% for MMS, and 11% for data transmission, respectively. Only the
prices for SMS remained unchanged.
 Decreasing prices for roaming services translated into their greater use,
particularly data transmission (increase by 38%).
Fixed-line telephony
 The year 2011 was characterized by a further decline in the value of fixed-line
telephony (by PLN 0.8 billion) and the number of subscribers (by 0.8 million).
 The declining trend was typical for voice services provided over traditional
PSTN (POTS and ISDN) networks. At the same time, the number of cable TV
and WLR lines increased - by 21.8% and 6.4%, respectively.
5
 With the shares at the level of 62.6% in the number of subscribers and of
60.6% in revenues, TP remained the main player.
 The structure of revenues from calls made was dominated by calls to mobile
networks (40.6% in value) and local calls (36.3%).
 Traffic volume was dominated by domestic fixed-line calls - local (58.6%) and
long distance calls (23.2%).
 The development of VoIP services slowed down. The number of users
decreased by 20.3%, while the market value increased by only 6.8%.
2. Internet access
2.1. Retail market
2.1.1. Characteristics of the Internet access market
The Internet access market was characterised by growing popularity and demand for
this service. As of the end of 2011, it was used by over 10 million users, nearly 12%
more than in 2010. This translated into penetration at the level of 74.4% for
households and 26% per 100 Polish inhabitants (Figure 1).
Nearly 6.7 million persons had fixed-line access, while over 3.3 million bought mobile
Internet service. From among over a million new customers up to 52.2% decided to
use 2G/3G modems, which became the most popular access technology in Poland.
Figure 1. Broadband Internet penetration rates
80% 74,4%
70,0%
65,9%
61,0%
60%
40%
23,0% 24,5% 26,0%

21,3%
20%
0%
I half II half I half II half
2010 2011
per 100 inhabitants per household
Source: UKE.
Comparison with the EU countries
The widespread popularity of mobile Internet meant that Poland was one of the
countries with the highest penetration rate in this service (the ninth place), exceeding
the EU average by 0.2 percentage points (Figure 2).
6
Figure 2. Penetration per 100 inhabitants of the mobile broadband Internet access in the EU
countries
52,8%
55%
50%
45%
40%
35%
30%
20,5%
19,9%
25%
16,5%
13,3%
20%
10,7%
10,7%
10,2%
15%
8,3%
8,1%
7,9%
7,1%
6,1%
6,6%
6,0%
6,6%
6,4%
5,1%
5,1%
3,3%
5,3%
2,5%
4,8%
3,7%
3,4%
4,9%
3,5%
10%
5% average EU 8,1%
0%
FI SE AT DK IE EE PT IT PL GB LT SK ES DE LU CZ NL HU RO LV FR MT GR BG CY BE SI
Source: UKE based on Digital Agenda Scoreboard 2011.

Note: According to UKE’s evaluations, the penetration ratio for Poland was 8.7%. The difference
results from including in the Digital Agenda Scoreboard only 2G/3G modems of four MNOs.
Fixed-line Internet access in Poland remains at a lower level than in majority of the
EU countries. The penetration remained at the level of 10.4 percentage points below
the EU average (Figure 3).
7
Figure 3. Penetration of fixed broadband Internet access in the EU countries, per 100
inhabitants
60%
50%
40,6%
39,3%
35,0%
33,3%
32,6%
32,4%
32,0%
31,7%
40%
30,9%
29,9%
27,2%
24,6%
22,1%
26,4%
21,8%
24,7%
23,0%
24,3%
22,6%
25,1%
22,2%
average EU
30% 27,7%
21,6%
20,4%
17,8%
17,3%
16,0%
15,2%
20%
10%
0%
NL DK FR DE SE BE LU GB MT FI EE AT CY ES SI IE CZ LT IT HU GR PT LV SK PL BG RO
Source: UKE based on Digital Agenda Scoreboard 2011.

2.1.2. Users
Internet access services are provided primarily through 2G/3G modem, xDSL lines,
cable modems of cable TV operators, wired LAN-Ethernet networks and wireless
WLAN networks (Figure 4). The largest number of users had mobile Internet access,
which became the most popular form of service. Other technologies, including above
all CDMA, WiMax, and FWA, were used by approximately 2.7% of recipients.
8
Figure 4. Number of users in terms of the access technology used
3,5 3,33
3,0 2,82 2,84 2,79
2,5
1,96
[users in millions]
2,0 1,81
1,5
1,04
1,0 0,76
0,60 0,58
0,5
0,0
xDSL CTV modem LAN-Ethernet WLAN 2G/3G modem
2010 2011
Source: UKE.
As in 2010, the largest customer base was held by TP (Figure 5). Subsequent
positions were occupied by mobile network operators whose combined shares at the
level of 40.5% demonstrate the popularity of mobile services and their growing
competition in relation to the fixed-line Internet access. The largest increase in the
number of users was reported by PTK Centertel (37.6%) and P4 (24.1%).
9
Figure 5. Shares of the operators in terms of the number of users
0% 5% 10% 15% 20% 25% 30%
TP 20,1%
22,1%
PTK Centertel 15,9%
12,9%
Polkomtel
10,4%
10,5%
P4
7,5%
6,7%
PTC
6,7%
7,3%
6,0%
UPC
5,9%
4,4%
Netia
5,1%
3,6%
Multimedia Polska
3,4%
Vectra 3,3%
3,1%
2,1%
Aster
2,1%
1,5%
Telefonia Dialog
1,6%
1,0%
Internetia
1,0%
Other ISP's 17,6%
18,1%
2011 2010
Source: UKE.
Note: the following technologies were included: 2G/3G modem, xDSL, cable TV modem,
LAN-Ethernet, WLAN, leased lines, fixed wireless FWA, WiMax, CDMA, and satellite links.
2.1.3. Revenues
The market value measured by revenues reached nearly PLN 4 billion 2, which
represented a slight decrease (1.8%) in comparison to 2010. This was primarily the
result of the reduction of revenues from the offers based on xDSL lines by nearly
10.7%. Revenues of operators providing services based on other access
technologies increased, in the case of WLAN by up to 18.3%, while in respect to
2G/3G modems, by 10% (Figure 6).
2
Total revenues (excluding VAT) from the Internet access services provided through xDSL lines,
cable modem, local area wired networks LAN-Ethernet, wireless WLAN networks, leased lines, fixed
FWA, WiMax, CDMA, satellite links and 2G/3G modems. Each category includes revenues from
services based on BSA.
10
Figure 6. Value of the market in terms of technologies used
[PLN billion, VAT excl.]
0,00 0,50 1,00 1,50 2,00
1,51
xDSL
1,69
0,92
CTV modem
0,91
0,37
LAN-Ethernet
0,36
0,25
WLAN
0,21
0,73
2G/3G modem
0,66
2011 2010
Source: UKE.
In the structure of revenues, xDSL lines still play a major role, although their shares
decline annually (Figure 7). This is mainly due to the growing competitiveness of offers
of cable TV operators and mobile networks.
Figure 7. Revenues structure in terms of technologies used
5,1% 5,0%
100%
5,3% 6,4%
9,0% 9,3%
80%
16,3% 18,2%
60%
22,6%
23,1%
40%
20% 41,8% 38,0%
0%
2010 2011
xDSL CTV modem 2G/3G modem LAN-Ethernet WLAN others
Source: UKE.
Note: The category "others" includes: Fixed Wireless Access, leased lines, satellite links, CDMA and
WiMax.
ARPU
Average monthly revenue from the subscriber of the Internet access service (ARPU)
amounted to PLN 33.1, being a decrease by almost 12%. As in 2010, the highest
ARPU was characteristic for the LAN-Ethernet services - PLN 52.8. Average monthly
11
revenue generated by the user of xDSL lines continued at a relatively high level -
PLN 44.3, and of cable TV – at PLN 39.
2.1.4. Internet access technologies
XDSL lines
The services based on xDSL lines were used by a total of approximately 2.8 million
users, generating revenues for operators at the level of PLN 1.5 million. Compared
with 2010, the market structure did not change substantially. The largest share, both
in terms of the number of customers and revenues, was recorded by TP (Figure 8).
Figure 8. Shares of the operators in the total number of users that use Internet access
services based on xDSL lines
4,8% 4,8%
5,5%
14,2%
70,7%
TP Netia PTK Centertel Telefonia Dialog others
Source: UKE.
12
Cable modem
Over 1.96 million customers were using the Internet access services provided by
cable TV operators, nearly 0.16 million more than in 2010. The market value
increased by 0.6%, to PLN 0.92 million. The growing popularity of this technology
was associated with high bandwidth offered at an attractive price, especially
compared to xDSL lines.
The main suppliers of services were six companies: UPC, Vectra, Multimedia Polska,
Aster, Toya and INEA (Figure 9). The largest increase in the number of users was
recorded by Vectra (18.4%), thus becoming the second player on the market after
UPC.
Figure 9. Shares of the operators in the total number of users that use Internet access
services through cable TV modem
20,7%
30,3%
3,8%
4,1%
8,8%
16,8%
15,5%
UPC Vectra Multimedia Polska Aster Toya Inea others
Source: UKE.
2G/3G modem
In 2011, 2G/3G modems became the most popular form of Internet access, getting
ahead of the so far dominant xDSL lines. The number of users amounted to over
3.33 million, an increase by nearly 19.5%.
Mobile Internet access was provided mainly by the four MNOs, who together held
95.6% of the customer base. At the same time, shares of other operators increased
fourfold (particularly Cyfrowy Polsat), which testifies to their growing competitiveness
against major suppliers (Figure 10).
Polkomtel had the highest number of users. However, the company's shares decline
each year, primarily for the benefit of PTK Centertel and P4. Both operators
increased their customer base by 32.5% (PTK Centertel) and 24.1% (P4),
respectively.
13
Figure 10. Shares of the operators in the total number of users that use 2G/3G modems
0,2% 1,1% 4,4%
100%
24,7% 22,4% 19,1%

80%
15,4% 21,7% 22,5%

60%
20,5%
21,0% 23,2%
40%
20% 39,2% 33,9% 30,8%
0%
2009 2010 2011
Polkomtel PTK Centertel P4 PTC others
Source: UKE.
WLAN and LAN-Ethernet
WLAN and LAN-Ethernet technology is used mainly by local ISPs providing services
to a narrow audience. Their number oscillated at a level of over 8,500, of which
nearly half had fewer than 100 customers.
Over 1 million persons used WLAN access, i.e. 37.7% more than in 2010. Almost
half of them (46.4%) were the customers of PTK Centertel, while shares of the other
operators did not exceed 1%.
LAN-Ethernet enjoyed less popularity than wireless networks. The total number of
users reached 0.58 million, which represented a slight decrease compared to 2010
(by 3.4%). The main supplier of the service was Internetia, shares above 2% were
also reported by MNI Telecom, Aster, Multimedia Polska and the ONET Group (Figure
11).
Figure 11. Shares of the operators in the number of users that use Internet access service
through the LAN-Ethernet technology
16,8%
5,1%
2,6%
2,2%
71,2% 2,1%
Internetia MNI Telecom Aster

Multimedia Polska Grupa ONET others
Source: UKE.
14
As in Poland, xDSL lines comprised the most common fixed-line technology in almost
all countries of the European Union (Figure 12). In the Czech Republic, Romania,
Latvia, Bulgaria, Slovakia and Lithuania, other access technologies, mainly LAN and
WLAN, had the highest penetration rate. In contrast, in Hungary, the largest
percentage of households uses the services of cable TV operators.
Figure 12. Penetration of households with fixed-line broadband Internet access services by
type of technology used in the selected EU countries
5,2%0,7%
100%
3,4%
0,1%
15,6% 0,2%
13,6%
13,0% 1,4%
80%
8,9% 0,6%
16,5% 5,1%
18,0% 11,3%
0,2%
37,2%
11,0% 8,5%
6,4%
17,8% 1,1%
36,0%
1,1%
21,9%
12,9% 20,0%
60%
9,6%
12,7% 20,9%
22,9% 12,9% 10,1%

22,7%
21,2% 11,3% 23,9%
16,6% 2,4% 23,9%

15,0% 3,3% 35,8%
81,8%
14,4% 5,6% 25,4%
16,5% 4,7%17,3%
11,7%6,1% 24,4%
40%
24,9%
63,5%
60,9%
56,9%
54,3%
51,6%
48,3%
46,4%
46,3%
46,1%
45,8%
40,6%
38,8%
34,1%
32,8%
29,2%
20%
20,6%
0%
NL FR BE DK GB ES SI IE DE SE FI PT EE GR AT CZ HU LT IT PL RO LV BG SK
DSL CTV modem others
Source: UKE based on Telecoms Market Matrix, Analysys Mason database.

Note: The category "others": PLC, WLAN, FWA, FTTB and LAN.
2.1.5. Bandwidth
A consumer survey commissioned by UKE showed that the line speed was the main
criterion for choosing a service provider (56.9% of responses), whereas the price was
in the second place (54.7%).3 In response to the growing demand, the number of
lines with high bandwidth increased. Approximately 73.8% of them were
characterized by a speed equal to or exceeding 2 Mb/s, an increase by 24.7
percentage points in comparison to 2010 (Figure 13). The highest rate was offered
primarily by cable TV operators - they had 70.9% of lines in the range of 10 Mb/s or
more.
3
Respondents could indicate more than one answer.
15
Figure 13. Throughput in terms of the type of access technology used
0% 20% 40% 60% 80% 100%
26,2%
<144 kb/s, 2 Mb/s)
50,9%
50,0%
<2 Mb/s, 10 Mb/s)
36,4%
20,3%
<10 Mb/s, 30 Mb/s)
11,1%
2,9%
<30 Mb/s, 100 Mb/s)
1,3%
0,7%
≥100 Mb/s
0,3%
2011 2010
Source: UKE.
Notes: Includes bandwidth of which throughput was determined by the operator. Summary includes:
xDSL (including LLU and BSA), cable TV, FWA, LAN-Ethernet, WLAN, WiMax, fixed CDMA, FTTH,
and satellite links.
2.1.6. Prices for broadband access services
To compare prices, there were compiled offers of thirteen operators with the largest
customer base providing services over xDSL lines (own lines and TP lines) and
through cable TV modems:
 INEA S.A.,
 Multimedia Polska S.A.,
 Multimedia Polska-Południe S.A.,
 Netia S.A.,
 Petrotel Sp. z o.o.,
 Polska Telefonia Cyfrowa S.A.
 PTK Centertel Sp. z o.o.,
 Telefonia Dialog S.A.,
 Telekomunikacja Kolejowa Sp. z o .o.
 Telekomunikacja Polska S.A.,
 Toya Sp. z o.o.;
 UPC Polska Sp. z o.o.,
 Vectra S.A.
The following are the monthly usage costs in one-year and two-year contracts for the
service provided over alternative operators’ own infrastructure and over TP's lines.
The fees for the Internet access depended on three factors - the line speed, type of
infrastructure (TP or AO-based), and the length of the contract (Figure 14, Figure 15).
Internet access rates offered by AO based on their own network were on average
cheaper by 28.5% than on the TP lines. In the case of cable TV operators, an
additional factor affecting the attractiveness of the offer were high-speed lines - up to
120 Mb/s (UPC, Multimedia Polska and Multimedia Polska-Południe). Users of the
xDSL technology could get no more than 50 Mb/s (Telefonia Dialog).
16
Longer contractual periods also translated into lower monthly usage costs. This was
due to spreading over time the one-off payments incurred by the subscriber, in
particular the connection fee. Two-year contracts decreased the average monthly
cost by 19.9% in the case of service offers provided over the TP lines, and by 12%
for services based on alternative operators’ own infrastructure.
Figure 14. Average monthly Internet access usage fees for the contract period of 12 months
155,74
200
180
123,03
113,03
160
100,72
[PLN, VAT incl.]
140
95,93
93,59
83,49
83,49
120
73,15
72,5
61,41
100
59,74
41,32
80
60
40
20
0
≤1 2 (2,5> (5,10> (10,20> (20,30> (30,100) ≥100
[Mb/s]
TP AO's own infrastructure
Source: UKE.
Notes: For each bandwidth there was calculated an arithmetic mean of costs of offers of operators
included in the analysis. Promotions and pricing tariffs for individual customers using only the Internet
access service were taken into account. TP means both offers of Telekomunikacja Polska and
services provided based on the incumbent operator’s lines. Situation as of 06/06/2011.
Figure 15. Average monthly Internet access usage fees for the contract period of 24 months
140 105,42
120
89,63
83,18
81,84
100
71,28
70,83
66,95
[PLN, VAT incl.]
58,54
53,42
80
51,45
39,85
60
40
20
0
≤1 2 (2,5> (5,10> (10,20> (20,30> (30,100)
[Mb/s]
TP AO's own infrastructure
Source: UKE.
Notes: For each bandwidth there was calculated an arithmetic mean of costs of offers of operators
included in the analysis. Promotions and pricing tariffs for individual customers using only the Internet
access service were taken into account. TP means both offers of Telekomunikacja Polska and
services provided based on the incumbent operator’s lines. Situation as of 06/06/2011.
17
According to a consumer survey conducted in December 2011, the average monthly
amount of charges for the Internet access oscillated at the level of PLN 57. Over half
of respondents (52%) paid for the service PLN 50 or less (Figure 16).
Figure 16. Average monthly expenses for using the Internet access service
0% 5% 10% 15% 20% 25% 30% 35% 40%
to 20 1,5%
21-40 17,8%
41-50 33,0%
[PLN]
51-60 21,0%
61-80 12,9%
81-100 5,5%
above 100 3,0%
I do not know/hard to say 5,3%
Source: UKE based on Telecommunications market in Poland in 2011. Individual customers,

report of a consumer survey conducted for UKE by PBS DGA Sp. z o.o. and CBM
INDICATOR Sp. z o.o., December 2011
Prices of service baskets in the European countries
For the selected speeds, the Internet access prices in Poland ranked near the EU
average (Figure 17, Figure 18). Only in the case of offers with a line of 20 Mb/s, monthly
costs of service were the highest among the countries included in the summary.
Figure 17. Average monthly cost of service in the selected EU countries
80
57,14
49,71
60
39,74
35,79
[EUR, VAT incl.]
33,32
32,49
29,82
25,76
25,51
25,18
40
24,38
23,94
22,06
19,68
19,31
18,93
17,31
17,33
16,72
16,43
16,33
15,53
13,49
14,7
9,81
20
6,86
5,24
1,54
0
IT
IE
FI
GR
GR
FI
CY
RO
CZ
LT
DE
LV
LT
LV
DE
CY
EE
PT
AT
SI
PL
BE
AT
ES
SK
PL
SI
SE
≤1 2
[speed in Mb/s]
Source: UKE based on Teligen T-Connect.

Notes: offers for 12 and 24 months were taken into account. For Poland the selected undertaking was
Telefonia Dialog. The cost of service as of September 2011.
18
Figure 18. Average monthly cost of service in the selected EU countries
100
75,13
71,61
80
50,39
[EUR, VAT incl.]
60
37,92
31,40
30,34
27,18
27,12
26,83
23,46
23,20
23,25
22,13
19,80
21,36
40
17,76
19,70
19,61
19,53
18,26
15,65
16,65
13,50
11,54
11,54
11,00
8,75
5,25
20
2,75
IT
MT
FI
HU
GB
LT
RO
DK
CZ
LU
RO
LU
DK
LV
NL
SK
AT
PL
SE
EE
BG
PL
SI
ES
SK
BE
EE
SI
ES
10 20
[speed in Mb/s]
Source: UKE based on Teligen T-Connect.

Notes: offers for 12 and 24 months were taken into account. For Poland the selected undertakings
were UPC (for 10 Mb/s) and TP (for 20 Mb/s). The cost of service as of September 2011.
2.1.7. Bundled services market
Bundling of services is one of the dominant trends in the telecommunications market.
The number of users of packages increased by 23.5% to over 2.6 million subscribers,
generating revenues of around PLN 1 billion.
Nearly 80% of users opted for one of the double-play offers, 19.7% chose the triple-
play option. The most frequently bundled offers were cable TV and Internet access.
The customers also showed a growing interest in the offer "fixed-line telephony +
Internet" (Figure 19).
Figure 19. Shares of service bundles in terms of the number of subscribers
0% 20% 40% 60%
cable TV + Internet
48,1%
54,0%
fixed-line telephony + Internet+ cable TV
16,4%
16,8%
fixed-line telephony + Internet
15,1%
10,8%
mobile telephony+ Internet
10,0%
10,8%
fixed-line telephony +cable TV
3,3%
3,1%
fixed-line telephony + mobile telephony
2,7%
2,4%
other variants
4,3%
2,1%
2011 2010
Source: UKE.
Note: The category "other options" includes the following bundles:
- mobile telephony + Internet access + cable TV,
- fixed-line telephony + mobile telephony + Internet access,
19
- fixed-line telephony + mobile telephony + Internet access + cable TV,
- mobile telephony + cable TV,
- fixed-line telephony + mobile telephony + cable TV,
The package "cable TV + Internet" was used by a total of approximately 1.3 million
subscribers. The main supplier of the service was TP and cable TV operators,
including in particular UPC together with Aster (total shares - 24.6%) and Vectra
(Figure 20).
Figure 20. Shares of the operators in terms of the number of subscribers to the "cable TV +
Internet access" bundle
9,1%
4,2%
5,0%
45,9%
16,2%
19,6%
TP UPC Vectra Aster Toya others
Source: UKE.
2.2. Wholesale market
The wholesale market includes the provision of bitstream access (BSA) and network
infrastructure access to AO at a fixed location on the basis of local loop unbundling
(LLU). BSA and LLU together accounted for 22.3% of all xDSL lines ( Figure 21). The
only provider of these services was TP, and their main customer - Netia and PTK
Centertel.
Figure 21. Structure of the market for wholesale access to the Internet in terms of the type of
infrastructure used
100% 1,8% 4,4% 5,9%

15,9%
17,8% 16,5%
80%
10,4%
10,5% 14,7%
60%
40%
71,9% 67,3% 62,9%
20%
0%
2009 2010 2011
TP AO's own infrastructure BSA LLU
Source: UKE.
20
2.2.1. The service of wholesale bitstream access (BSA)
Telecommunications services based on BSA were provided primarily by Netia, PTK
Centertel, PTC and Telefonia Dialog (Figure 22). Individual shares of the other 38
operators using bitstream access were less than 0.5%.
Figure 22. Shares of alternative operators in terms of the number of BSA lines
1,5% 4,6%
7,4%
29,9%
56,6%
Netia PTK Centertel PTC Telefonia Dialog others
Source: UKE.
2.2.2. The service of wholesale access to the local subscriber loop (LLU)
By the end of 2011, there were 186 400 unbundled local loops, over 43.5% more
than in 2010. The penetration rate, measured by the ratio of the total number of LLU
to xDSL lines, was 6.88% (Figure 23).
The only recipient of the service was Netia. Lack of interest from other alternative
operators resulted primarily from investment risk and costs associated with the use of
LLU.
Figure 23. LLU penetration in the number of all xDSL lines
10%
8%
6,88%
6,06%
6%
4,88%
4%
2,89%
1,99%
2%
0,07% 0,31%
0,01%
0%
I half II half I half II half I half II half I half II half
2008 2009 2010 2011
Source: UKE.
21
Comparison of Poland and the EU countries
Average penetration of LLU in the European Union amounted to 19.2%. The service
enjoyed the greatest popularity in Greece, Britain and France (Figure 24). Poland was
one of the countries with the lowest percentage of unbundled loops in xDSL lines. In
four countries - Lithuania, Bulgaria, Latvia and Slovakia - LLU service was not
provided.
Figure 24. LLU penetration in the number of all xDSL lines in the selected EU countries
69,3%
80%
48,9%
60%
45,7%
38,5%
37,1%
34,1%
29,8%
30,3%
40%
27,4%
27,0%
16,5%
14,5%
13,2%
20% 8,4%
5,8%
5,2%
4,2%
2,9%
2,4%
0,2%
0%
0%
0%
0%
0%
GR GB FR DE NL SE ES IT FI SI DK PT AT IE PL CZ EE HU BE RO LT BG LV SK
Source: UKE based on Telecom Market Matrix, Analysys Mason database.

3. Mobile telephony
3.1. Retail market
3.1.1. Characteristics of the mobile telephony market
As of 31 December 2011, services in the segment of mobile telephony were
conducted by 23 telecommunications undertakings, including 16 virtual network
operators (MVNO). The Aero 2 company provided services of free internet access
only.
The penetration of the Polish market amounted to approximately 131.6%, which gave
over 50.1 million SIM cards used by consumers (Figure 25) and demonstrates the
maturity of this market segment.
The dynamics of growth in the number of users amounted to 6.8% and was higher
than in 2010 by 4.8%. The position of a leader in terms of customers acquired was
held by the P4 company, with increased subscriber base by over 1.9 million (an
increase of 37%) in comparison to the year 2010. The second place, with an increase
of over 950,000 (7.4%) clients was reported by PTC. A decrease in the number of
users at the end of 2011 was recorded by Polkomtel, which lost almost 63,000
customers over the year.
22
Figure 25. Nominal number of users and nominal market penetration in Poland
Source: UKE.
Based on data from the Telecom Market Matrix Analysys Mason base, the
penetration rate of 123.7% was below average for the EU countries (129.5%),
whereas the reported values do not include customers who have not used the
services for more than three months (Figure 26).
Figure 26. Penetration of the mobile telephony market in the European Union
Source: UKE based on Telecom Market Matrix, Analysys Mason.

The number of SIM cards distributed is not synonymous with the number of mobile
phone users. According to a consumer survey conducted in December 2011, up to
94.1% of Poles (by over 4 percentage points more than a year earlier) declared to
have a mobile phone, and to have two private phones - 3.3% of the respondents
(down by 1.3 percentage points). One business phone was statistically owned by
4.4% of respondents. (Figure 27).
23
Figure 27. Number of mobile phones owned (private and business) in a household
Source: UKE based on Telecommunications market in Poland in 2011. Individual customers

Report on a consumer survey conducted for UKE by PBS DGA Sp. z o.o. and CBM
Note: The number of telephones in the household: n = 1356, only the respondents who own a mobile
phone were asked the question.
In the coming years, the increase in the number of active SIM cards only minimally
will depend entirely on new users, because the customer base of mobile telephony in
the country has already been considerably utilized. The increase in market
penetration will largely depend on the customers who decide to have more than one
phone.
3.1.2. Revenues
The value of the segment in terms of revenue from the retail services 4 reached
slightly over PLN 19 billion (it was only by 0.6% higher than in 2010).
The majority of revenues (80%) were generated by post-paid customers. The highest
revenue category comprised income from outgoing voice calls (over 40%), revenues
from SMS reached almost 14%, whereas revenues from data transmission 8.6%.
Retail revenues from the mobile telephony sector in 2011, as in the previous year,
accounted for more than 44% of the entire telecommunications market value.
The value of average revenue per mobile telephony customer (ARPU) in Poland has
been steadily decreasing each year. One of the main reasons for the decrease is
largely the reduction of MTRs, as well as calls price reduction on the retail market.
3.1.3. Client structure
The mobile telephony customer base saw a slight increase in the proportion of users
of pre-paid services. Over recent years, the number of customers using pre-paid
4
Total revenue from fees collected from end-users due to: activation of services and
terminal equipment – telephones, subscription fees, voice calls originated in the
network, sent SMS and MMS, data transmission, outbound roaming, number
portability services, premium rate services, stipulated and other penalties obtained
from end-users, in PLN, excluding VAT.
24
cards has been decreasing. In 2011, there was a reversal of this trend and the share
of customers of pre-paid cards increased. The number of users of post-paid and pre-
paid services constituted 47% and 52%, respectively (Figure 28). P4 was the only
company to maintain the share of pre-paid users at the level of over 63%.
Figure 28. Share of customers of post-paid and pre-paid services
Source: UKE.
3.1.4. Shares of the operators
Shares of the largest operators in the market are stable, P4 strengthens its position
year by year.
PTK Centertel had the largest customer base, while Polkomtel, despite loss of
customers, occupied the second place. The most significant increase in shares (by
more than 3.1 percentage points), in comparison with the year 2010, was recorded
by the P4 company (Figure 29).
25
Figure 29. Shares of the operators in terms of the number of users
Source: UKE.
In 2011, there was a change in leadership in the mobile telephony market in Poland
in terms of obtained revenues. PTK Centertel became the leader (over 31.6%), while
the Play network operator improved its position by 3 percentage points (Figure 30). The
highest, almost 6% drop in revenues was recorded in 2011 by Polkomtel, the biggest
increase - over 49% by P4.
Figure 30. Shares of the operators in terms of revenues
Source: UKE.
Despite the introduction of new brands on the market and increase in the number of
users, the share of MVNO in the entire mobile telephony market in Poland, both in
terms of revenue and number of customers, continues to be insignificant and remains
at the level below 1%.
In the case of revenues from voice calls, the largest market share was held by PTK
Centertel, over 16.5 percentage points more than by Polkomtel, which occupied the
second position (Figure 31).
26
Figure 31. Shares of the operators in terms of revenues from voice calls
Source: UKE.
Revenues from voice calls recorded a negative dynamics of change (- 6.3%).
Another decrease in revenues is a consequence of the introduction of new, cheaper
fares, as well as increased popularity of free minutes packages. Eventually, an
increase by 10.5% in the network traffic was not reflected in revenues from services.
In terms of the number of SMS sent, Polkomtel took the first position, with a
predominance of 6.33 percentage points over the second PTK Centertel and more
than 28 percentage points over PTC (Figure 32).
Figure 32. Shares of the operators in terms of SMS sent
Source: UKE.
3.1.5. Service volumes
The total time of outgoing voice calls amounted to over 63.8 billion minutes,
representing an increase of more than 10.6% in comparison to 2010 ( Figure 33). The
27
mobile telephony user5 talked on average for over 1670 minutes annually, i.e. by
about 270 minutes longer than in 2010.
Average length of the call made amounted to 1.72 minutes.
Figure 33. Duration of outgoing voice calls and the dynamics of change
Source: UKE.
In terms of the calls structure, in 2011 again the greatest share (89.4%) belonged to
calls directed to mobile networks (M2M), which included over 62% of on-net traffic,
owing its popularity to offers of cheap or free calls with chosen numbers in the same
network.
In 2011, in Poland over 51.6 billion SMS were sent, which means that the statistical
user per year sent around 1352 messages, which at the same time constituted an
increase by only 0.4%, in comparison to the previous year ( Figure 34). This is the
result of the possibility to quickly send messages using Internet communications,
such as instant messengers or social networking sites, like Facebook.
5
In this context, users are understood as inhabitants of Poland.
28
Figure 34. Number of SMS sent in Poland and the dynamics of change
Source: UKE.
In 2011, in Poland, 326 million multimedia messages were sent, which means
approximately 8.5 per person (increase by 19% compared to 2010) ( Figure 35). This is
due to popularization of high-tech mobile phones with integrated cameras with
increasingly higher resolution, and lower prices for the MMS service.
Figure 35. Number of MMS sent in Poland and the dynamics of change
Source: UKE.
Data transmission in mobile phones was a service whose popularity has increased
the most in the recent years. The statistical customer generated 1930 MB of
transferred data, by over 97% more than last year (Figure 36), because an increasing
number of users is interested in being able to access the Internet on the phone,
which enables it at any time and any place. A growth driving factor in this segment
are also gratis data packages added within the subscription.
29
Figure 36. Data transmission volumes (in MB) and the dynamics of change
Source: UKE.
Among the EU countries, Poland in terms of the number of minutes of voice call per
one active user (1351 min) was below the average for the EU countries (1551 min)
(Figure 37).
Figure 37. Duration of outgoing voice calls in the EU per one active user (min)
30
In terms of the number of SMS sent, the position of our country was slightly different.
On average, the Polish user sent over 200 messages more than the EU average -
986 (Figure 38).
Figure 38. Number of SMS sent in the EU per one active user

3.1.6. Number portability
The possibility to quickly and easily port the number has been available in Poland
since 2009. The essence of the service is cooperation and performance of all
operations by the existing and new operator, without the need to involve the service
user.
In 2011, over 1 million numbers were ported, most of them (71%) were transferred to
the Play network (Figure 39). The main driving force for migration to another network
are financial reasons and the opportunity to receive attractive phones.
31
Figure 39. Numbers ported from the network and to the network of the operator
Source: UKE.
3.1.7. Prices for mobile telephony services
In the conducted consumer survey, Poles declared the maximum amount they would
be able to pay for particular services. The average values amounted to PLN 0.27 per
minute for a voice call, PLN 0.15 for sending an SMS, and PLN 0.25 for an MMS,
respectively (Figure 40).
Figure 40. Maximum retail prices declared by individual customers

Report of a consumer survey conducted for UKE by PBS DGA Sp. z o.o. and CBM
Note: The expectations of consumers in respect of domestic prices: n = 1356, only the respondents
who own a mobile phone were asked the question, the average of the response brackets was given.
32
Prices for voice calls
Prices for domestic voice calls ranged from PLN 0.19 to PLN 0.67 per minute. The
average cost of calls stood at the level of PLN 0.35 per minute, so it was 2.8% lower
than in 2010 (Figure 41).
Figure 41. Prices for domestic voice calls made by users
Source: UKE.
Note: The calculations were made on the basis of the so-called basic tariff plans, without cost
decreasing promotions offered by all domestic mobile operators functioning at that time. The average
was calculated as the arithmetic mean value. Offers for individual and business subscribers as well as
prepaid customers were taken into account. Situation as of October 2011.
Prices for SMS
Prices for domestic SMS ranged from PLN 0.06 to PLN 0.25. The average cost of a
sent message fluctuated around PLN 0.18, and it remained unchanged in
comparison to the previous year (Figure 42).
Figure 42. Prices for domestic SMS sent by users
Source: UKE.
33
Prices for MMS
Prices for domestic MMS ranged from PLN 0.15 to PLN 1.23. The average cost of a
sent multimedia message amounted to PLN 0.45, so it was lower by 2.2% than in
2010 (Figure 43).
Figure 43. Prices for domestic MMS sent by users
Source: UKE.
Prices for data transmission
The charges for domestic data transmission ranged from PLN 0.00 to PLN 6.20 per 1
MB. The average price of the domestic service amounted to PLN 2.07 per 1 MB, and
so it was by 11% lower than in 2010, the maximum fee for 1 MB was also decreased
(by almost 50%) (Figure 44).
Figure 44. Prices for domestic data transmission realised by users
Source: UKE.
34
Prices for service baskets in the EU countries
According to the data provided by Teligen Polska, in 2011, Poland in terms of prices
for a monthly service basket intended for moderately active users was in the 9th
place among 18 selected countries of the European Union. The basket price
increased by 46% in comparison to 2010. The service charge for moderately active
users was lower by EUR 1.37 than the EU average (Figure 45).
Figure 45. Prices of monthly service baskets for moderately active mobile users from the
selected 18 countries in the European Union
Source: UKE based on the Teligen database.

Note: The basket for pre-paid and post-paid services in total, together with the purchasing power
parity, including VAT, calculated in Euro, for a moderately active customer, including the selected
promotional solutions. The average for 18 EU countries is calculated as the arithmetic mean value.
Situation as of November 2010 and November 2011.
3.2. Roaming
3.2.1. Characteristics of the roaming market
The total duration of outgoing voice calls in outbound roaming (Polish mobile
customers travelling abroad) amounted to over 467 million minutes, which is an
increase by almost 31% in comparison to 2010 (Figure 46).
35
Figure 46. Duration of outgoing voice calls while roaming and the dynamics of change
Source: UKE.
The users of Polish networks abroad sent more than 457 million SMS, which
translated into an increase in the service usage by more than 12% in comparison to
2010 (Figure 47).
Figure 47. Number of SMS sent while roaming and the dynamics of change
Source: UKE.
The volume of data transmission increased by over 38% in comparison to 2010 and
amounted to 9.4 million MB ( Figure 48).
36
Figure 48. Data transmission volumes (in MB) in roaming and the dynamics of change
Source: UKE.
3.2.2. Prices for roaming services

In the conducted consumer survey, Poles declared, also in relation to roaming
services, the maximum amounts they would like to pay for services. These sums
amounted to: PLN 0.74 per minute for voice calls, PLN 0.34 for sending an SMS,
PLN 0.49 for sending an MMS, and PLN 0.73 per 1 MB of transmitted data (Figure 49).
Figure 49. Maximum prices for roaming services as declared by individual customers

Report of a consumer survey conducted for UKE by PBS DGA Sp. z o.o. and CBM
Note: Consumer expectations concerning the roaming prices: n=144, the question was asked only to
respondents who have a mobile phone, travel to other EU countries and use roaming. The average
values were provided from the range of answers, the respondents were not asked about their
preferred price of incoming roaming calls.
37
Prices for voice calls
Prices for voice calls outside the country were several times higher than the costs
incurred domestically and ranged from PLN 0.99 up to PLN 1.70 per minute. The
average charge per minute was PLN 1.64, and thus it decreased compared to the
previous year by 7% (Figure 50).
Figure 50. Prices for voice calls made by roaming users within the European Union
Source: UKE.
Prices for SMS
Prices for SMS sent in roaming ranged from PLN 0.53 to PLN 0.54 per message.
The average charge, in comparison to 2010, did not change and amounted to PLN
0.53 (Figure 51).
Figure 51. Prices for SMS sent by roaming users within the European Union
Source: UKE.
38
Prices for MMS
Prices for MMS sent by users abroad ranged from PLN 0.53 to PLN 6 per one
multimedia message. The average price was PLN 2.98 and it was by 5.7% lower
than in 2010 (Figure 52). The maximum price remained at the same level.
Figure 52. Prices for MMS sent by roaming users within the European Union
Source: UKE.
Prices for roaming data transmission were far higher than domestic charges and
were set at the level from PLN 5 to PLN 70 per 1 MB of data. The average cost of
services amounted to PLN 18.55, an increase by 6.4%. The maximum price
increased by almost 16% (Figure 53).
Figure 53. Prices for 1 MB of roaming data transmission in the European Union
Source: UKE.
Average prices of services provided to Polish mobile customers abroad were several
times higher than domestic services: by PLN 1.29 for voice calls made, by PLN 0.35
39
for every sent SMS, by PLN 2.53 for an MMS, and by no less than PLN 16.48 for
data transmission services.
Revenues from interconnection
The interconnection market for mobile telephony involves origination and termination
of calls in the network of a given undertaking, as well as transit services.
Mobile operators achieved revenues from interconnection in the amount similar to
2010, i.e. approximately PLN 5 billion. Call termination played a major role in the
revenue structure (76.9% of share) (Figure 54).
Figure 54. Structure of revenues in the interconnection market
Source: UKE.
Note: The category of "other traffic" includes the undertaking's revenue from the traffic originating in
the network and routed to another operator's network, from the traffic incoming from another operator's
network, from data transmission calls terminated on the undertaking’s own network, from incoming
SMS, and from other interconnection services available in the undertaking’s own network.
The largest share in the interconnection market in terms of generated revenue was
recorded by PTK Centertel (Figure 55). P4, despite much smaller customer base
than the other MNOs, reached a high, over 18% market share, which was a
consequence of higher MTRs.
40
Figure 55. Shares of the operators in terms of revenue in the interconnection market
Source: UKE.
The total duration of all calls terminating in the undertakings’ network amounted to
almost 18.6 billion minutes.
Also in terms of duration of calls terminating in the network, PTK Centertel recorded
the highest share (31.1%). Shares of Polkomtel and PTC were 3 and 3.6 percentage
points lower, respectively. The share of P4 significantly increased (by more than 4.7
percentage points) in comparison to 2010, and thus reached 13% (Figure 56).
Figure 56. Shares of the operators in terms of duration of terminated calls in the
interconnection market
Source: UKE.
Almost 80% of terminating traffic originated in the mobile networks of other operators.
Users continued to rarely use the fixed-line network to make calls to mobile networks
(Figure 57).
41
Figure 57. Share of duration of calls originating in mobile and fixed-line networks, terminating
on a mobile network
Source: UKE.
Termination rates
The level of termination rates in mobile telephone networks (MTR) plays an essential
role in the development of the mobile telephony market in Poland. The four largest
operators in the market agreed to a slower pace of reductions of MTRs in exchange
for investments in areas known as "white patches". Starting from July 2011, the
MTRs for them was 15.2 grosze. P4 had a rate of 27.21 grosze, defined as the
percentage rate of the other three operators (179% of rate).
Following feedback from the regulator, operators decided to reduce the wholesale
rates for SMS, bringing them down to PLN 0.08 in early 2011.
4. Fixed-line telephony
4.1. Retail market
4.1.1. Characteristics of the fixed-line telephony market
This segment is characterized by a steady reduction in the number of subscribers
and the generated revenues (Figure 58). The number of users amounted to about 7.9
million subscribers, about 0.8 million less than in 2010. This was accompanied by
negative dynamics of the market value - revenues from fixed-line telephony
decreased by about PLN 0.8 billion to the level of PLN 5.2 billion.6
6
The market value, measured by the sum of revenues from charges for connecting to the network,
subscriptions and charges for telephone services (excluding revenues from the VoIP services
provided outside the xDSL network), excluding VAT.
42
Figure 58. Market value and the number of subscribers
14 12
10,7
10,0
12 9,2 10
8,7
10 7,9
[million of subscribers]
8,6 8
7,5
[PLN biliion]
8 7,2
6,0 6
6 5,2
4
4
2 2
0 0
2007 2008 2009 2010 2011
market value number of subscribers
Source: UKE.
A decrease in the demand for fixed-line telephony related mostly to the traditional
PSTN networks (POTS and ISDN) - in the past five years their customer base
decreased by nearly 33.5%. Simultaneously, the interest in the offer of cable TV
operators and the WLR lines has been gradually growing (Figure 59).
Figure 59. Number of lines by technology
12
0,45
0,33 0,41
0,27 0,35 0,22
10
1,36 0,88 0,39 0,27
1,05 0,47
[million of lines]
1,19 0,57
8 1,26 1,28
1,36
1,23
6 1,14
8,94 8,27
4
7,24
6,44 5,71
2
0
2007 2008 2009 2010 2011
POTS ISDN WLR CTV xDSL
Source: UKE.
Note: Due to their marginal role, no other types of lines were included. In 2007, no
data were collected on WLR.
In most EU countries, as in Poland, fixed-line services were provided primarily based
on traditional PSTN lines (Figure 60). An exception to this rule was Germany and the
Netherlands, which were dominated by digital ISDN lines.
43
Figure 60. Shares of lines by technology in the EU countries
25,0%
23,9%
21,1%
30,4%
11,8%
12,6%
10,8%
14,2%
3,0% 3,3%
6,3% 2,2%
9,6%
9,2%
6,1% 5,9%
4,8%
12,4% 4,3%
1,1% 4,5%
8,0%
5,1%
4,8%
8,5%
7,4%
1,5%
100%
18,1%
18,5%
16,9%
11,2%
18,6%
15,9%
12,5%
26,5%
22,3%
21,4%
9,2%
26,0%
80%
33,2%
21,4%
15,9%
17,7%
60% 54,0%
36,7%
98,5%
94,4%
93,6%
91,5%
87,9%
83,3%
81,9%
81,5%
80,8%
78,3%
76,6%
76,6%
75,7%
74,9%
69,2%
69,0%
68,4%
40%
61,4%
60,2%
57,5%
57,3%
56,0%
38,6%
32,9%
20%
0%
AT BE BG CZ DE DK EE ES FI FR GB GR HU IE IT LT LV NL PL PT RO SE SI SK
PSTN ISDN CTV

4.1.2. Revenues
The main source of revenues for operators were monthly rental and call charges
(Figure 61). The decreasing importance of voice services in the cost structure
resulted primarily from tariff plans widely offered with a package of pre-paid minutes.
According to a consumer survey conducted in December 2011, this option was used
by 78.8% of respondents.
A general practice included also promotions and discounts on connection to the
network, thus these charges generated only 0.3% of total revenues.
Figure 61. Revenue structure by service elements
0,2% 0,3% 0,5%

100,0%
0,2% 0,3%
80,0%
44,5% 46,7% 42,0% 42,9% 40,3%
60,0%
40,0%
55,4% 53,0%
20,0% 57,5% 56,8% 59,4%
0,0%
2007
2008
2009
2010
2011
fixed fees calls access fee
Source: UKE.
44
Local calls and calls to mobile networks played the main role in the revenue structure
(Figure 62). They constituted a total of 76.9% of volume, by 1 percentage point more
than in 2010. The shares of voice calls to mobile networks, maintaining at about
40%, were the effect of higher prices for these services, particularly in comparison to
revenues from fixed-line calls.
Figure 62. Revenue structure by type of outgoing calls
100%
80% 42,0% 41,5% 38,2% 38,2% 40,6%
60% 9,4% 9,7%

10,2% 9,2% 9,4%
14,9% 15,9% 14,5% 13,7%

40% 15,3%
20% 36,6% 37,7%

32,5% 34,5% 36,3%
0%
2007 2008 2009 2010 2011
local long distance international to mobile networks
Source: UKE.
ARPU
An average monthly revenue from subscriber (ARPU) reached PLN 54.6 - by almost
5% (PLN 2.8) less than in 2010. Over the past five years, operators' revenues from
an individual user decreased by more than 18.5%.
4.1.3. Traffic volume
Traffic volume amounted to approximately 14.7 billion minutes, about 8.6% less than
in 2010 (Figure 63). Despite this decline, an average monthly number of used minutes
per subscriber remained at the same level. This was the result of negative dynamics
of change, both for traffic volume and the number of users.
45
Figure 63. Traffic volume per subscriber and the monthly average number of minutes per
subscriber
25 190 200
175
160 154 154
20
[billion of min]
150
15
24,3 100
10 21,0
17,6 16,1 14,7
50
5
0 0
2007 2008 2009 2010 2011
total volume
monthly average number of minutes per subscriber
Source: UKE.
A fixed-line phone was used primarily for local calls (Figure 64). Their share in the
traffic volume, however, gradually decreases, mainly for the benefit of calls to mobile
networks.
Figure 64. Structure of the traffic volume
100% 10,2% 11,4% 12,5% 14,0% 15,5%

2,0% 2,1% 2,2% 2,3% 2,8%
80%
22,0% 22,3% 22,5% 22,9% 23,1%
60%
40%
65,8% 64,2% 62,8% 60,8% 58,5%
20%
0%
2007 2008 2009 2010 2011
Source: UKE.
The use of the fixed-line telephony by consumers and business customers shows
significant differences (Figure 65). The average duration of voice calls made by an
individual customer was 1307 minutes, of which 87.3% were to fixed-line numbers
(local and long-distance). Business customers used traditional phone lines much
more actively. A single subscriber called on average 3830 minutes, of which 73.8% in
the local and long-distance conversations. Calls to mobile networks were
characterized by over twice as large share than in the case of consumers.
46
Figure 65. Structure of traffic volume for business clients and consumers
business 47,4% 26,4% 3,4% 22,7%
residential 66,5% 20,8% 2,4% 10,3%
0% 20% 40% 60% 80% 100%
Source: UKE.
In all EU countries, domestic fixed-line calls held dominant position in the structure of
traffic volume (Figure 66). Poland stood out against other EU countries with a low
percentage of international calls (2.6%), only in Hungary this ratio was lower (2.2%).
Figure 66. Shares of call types in the volume of traffic in the EU countries
10,8%
14,4%
14,9%
14,2%
32,6%
16,2%
12,9%
14,4%
14,2%
11,5%
10,7%
18,6%
20,9%
27,4%
15,9%
19,9%
16,6%
4,0% 5,4%
9,3%
8,8%
9,2%
9,9%
2,6% 6,4%
9,4%
100%
4,7%
4,1%
4,2%
6,5%
7,1%
7,1%
7,8%
3,9%
2,2%
6,7%
2,6%
10,6%
9,9%
6,2%
6,0%
16,6%
26,1%
5,0%
6,7%
80%
15,5%
6,8%
6,0%
60%
91,0%
90,6%
86,7%
86,5%
86,5%
84,0%
83,2%
83,1%
82,9%
82,1%
81,6%
80,8%
79,5%
79,1%
77,6%
75,9%
75,1%
74,7%
74,1%
67,5%
40%
65,8%
64,7%
62,4%
61,4%
20%
0%
AT BE BG CZ DE DK EE ES FI FR GB GR HU IE IT LT LV NL PL PT RO SE SI SK
domestic international to mobile networks
4.1.4. Shares of TP and AO

Shares of the incumbent operator, both in terms of revenues and the number of
subscribers, exceeded 60% (Figure 67). However, for both indicators, negative
dynamics of change was recorded - 3.1 and 2.2 percentage points, respectively.
47
Figure 67. Shares of the operators in terms of the number of subscribers and the amount of
revenues in 2011
0% 20% 40% 60% 80%
TP 62,6%
60,6%
Netia 10,7%
15,7%
Telefonia Dialog 5,5%
5,5%
UPC 3,8%
2,5%
PTC 3,4%
2,0%
Telekomunikacja NOVUM 2,4%
1,7%
Multimedia Polska 2,3%
0,8%
PTK Centertel 1,6%
1,1%
Vectra 1,5%
0,6%
MNI Telecom 1,3%
1,1%
others 5,0%
8,4%
subsribers revenues
Source: UKE.
TP obtained most of its revenues from subscription fees (Figure 68). In the case of
alternative operators, both elements of the service reached a similar level in the
structure of revenues.
Figure 68. Revenue structure of TP and AO by service elements
100%
14,7% 15,5% 15,3% 17,1% 15,5%
80% 8,8% 9,4%
14,6% 11,6% 14,4%
60% 29,7% 31,2% 26,8% 25,8% 24,8%
40%
20%
46,8% 43,8% 43,4% 45,5% 45,3%
0%
2007 2008 2009 2010 2011
TP fixed fees TP calls AO fixed fees AO calls
Source: UKE.
As in 2010, the incumbent obtained most of the revenue generated by traffic to
domestic fixed-line numbers ( Figure 69). Proceeds from other types of connections
spread relatively uniformly. The AO networks covered most of the traffic to mobile
48
and international numbers, however, this did not translate into a similar share in
revenues.
Figure 69. Revenue structure of TP and AO by types of calls
100%
26,8%
80% 31,0%
46,8% 48,2%
60%
40%
73,2%
69,0%
20% 53,2%
51,8%
0%
local
long distance
international
to mobile
networks
TP AO
Source: UKE.
Figure 70. Shares of TP and AO in the traffic volume
100%
80% 46,3%
52,4%
60% 68,1% 45,8%
40%
53,7%
20% 47,6%
54,2%
31,9%
0%
local
long distance
international
to mobile
networks
TP OA
Source: UKE.
The service of wholesale line rental (WLR)
The WLR-based services enjoyed an unchanged popularity. In 2011, they were used
by over 1.4 million subscribers, nearly 18.1% of all users of fixed-line telephony. This
translated into an increase by nearly 5.3% in comparison to 2010.
In the most extensive scope, the wholesale network access was used by Netia,
whose customer base constituted 43.7% of subscribers on WLR. Among the other
alternative operators, the highest shares had Telefonia Dialog and Telekomunikacja
Novum (Figure 71).
49
Figure 71. Shares of alternative operators in the use of the WLR service
4,2% 6,8%
6,0%
8,6%
43,7%
13,2%
Netia 17,6% Telefonia Dialog

Telekomunikacja NOVUM PTK Centertel
Niezależny Operator Międzystrefowy MNI Telecom
others
Source: UKE.
4.1.5. Number portability
Number portability service attracted less attention than in the previous years
(Figure 72). The service was more popular for business customers, for whom keeping
the existing mobile phone number is important in their business.
Figure 72. Numbers ported from the network and to the network of the operator
600 531
500 398
400
[thousand]
300 329
200
197
122
100 126 153 146
-
from network
to network
2010 from network
to network
2011
residential business
Source: UKE.
4.1.6. VoIP
The VoIP services were provided to the users of traditional public networks (including
PSTN), based on own network and using the IP access networks of other operators.
They brought a total of approximately PLN 0.26 billion in revenues, thus recording an
increase at the level of 6.8%.
The VoIP market was characterised by steady increase in traffic volume. The total
duration of calls amounted to over 1.3 billion minutes, by 31.6% more than in 2010
(Figure 73). This trend continued despite the decline in the number of subscribers
using services - by 20.3%.
50
Figure 73. Number of subscribers and the traffic volume for VoIP services
1,00 1,00
[million of subscribers]
[billion of min]
0,80 0,79 0,80

0,92
0,60 0,59 0,60

0,57 0,48
0,47
0,36 0,37
0,40 0,40
0,75 0,37
0,52
0,20 0,39 0,40 0,20
0,26
0,06 0,15
0,00 0,00
2008 2009 2010 2011
traffic volume in own network

traffic volume in the network of another operator
number of subscribers in own network
number of subscribers in the network of another operator
Source: UKE.
The VoIP services provided within own network
The telephone services offered in the VoIP technology based on the operator’s own
network were used by about 0.48 million users generating revenues of approximately
PLN 0.13 billion. As in 2010, the largest share in the number of customers was
reached by TP (Figure 74). The highest revenues for providing the service was
recorded by Multimedia Polska (Figure 75).
51
Figure 74. Shares by the number of users Figure 75. Shares by the obtained
revenues
15,4%
37,7% 19,2%
9,7% 33,8%
5,0%
5,4%
11,6% 25,6%
15,0% 21,6%
TP Multimedia Polska Netia Inotel others
Multimedia Polska Netia
TP TATA Communications
Inotel others
Source: UKE
Traffic volume increased by 23.2%. The majority constituted domestic fixed-line calls
(66.9), while the highest revenue was generated by mobile calls (46.8).
VoIP services provided in the network of another operator
The VoIP services offered with the use of access network of other operators were
used by about 0.37 million users generating revenues of approximately PLN 0.08
billion. The largest customer base was held by Aiton Caldwell (owner of the
FreeConet tlenofon brand) and Netia (Figure 76). Netia obtained the highest shares in
terms of revenue by increasing its receipts by more than double in comparison to
2010 (Figure 77).
Figure 76. Shares by the number of users Figure 77. Shares by the obtained
revenues
3,0% 7,5%
35,1% 21,7%
20,1%
11,1%
34,3% 67,2%
Aiton Caldwell Netia Tartel Voxnet others
Netia Aiton Caldwell others

Source: UKE.
The volume of VoIP traffic generated by the users of VoIP services offered in other
operators’ access networks amounted to over 0.4 billion minutes, recording an
increase by 55.9% in comparison to 2010. Over 82.5% constituted domestic calls to
fixed-line networks. Voice services to mobile networks, although constituted only 11.9
% in total traffic, corresponded to 46.2% of revenues obtained for these calls.
4.1.7. Prices for fixed-line telephony services
To compare the prices, the tariffs of nine largest operators in the market in terms of
the number of subscribers were compiled. From among the offers from each of them,
one tariff plan was selected. The basic criterion was the lowest price of calls to
mobile networks, followed by the cost of calls to fixed-line networks. In case of a
uniform rate for several tariff plans the one with the lowest subscription fee was
considered.
52
Based on the above criteria the following tariff plans were selected:
 MNI Telecom S.A.: Taryfa Twoje Minuty 60,
 Multimedia Polska S.A.: Plan Taryfowy Wygodny,
 Netia S.A.: Non Stop,
 Polska Telefonia Cyfrowa S.A.: Nowa Taryfa Domowa,
 Polska Telefonia Komórkowa Centertel Sp z o.o.: Nowy Orange Stacjonarny,
 Telefonia Dialog S.A.: Profil 100 Minut,
 Telekomunikacja Polska S.A.: Plan doMowy Ile Chcesz,
 UPC Polska Sp. z o.o.: Rozmowy non-stop Europa i świat,
 Vectra S.A.: Plan Rozmowy bez limitu świat.
Prices for calls to fixed-line networks
The prices for domestic fixed-line calls ranged from PLN 0.06 (Multimedia Poland) to
PLN 0.49 (MNI Telecom). With the exception of MNI Telecom, operators applied a
single rate for local and long distance calls.
As in the case of domestic voice services, the lowest and the highest rate for
international calls were offered by Multimedia Poland (PLN 0.30) and MNI Telecom
(PLN 1.69), respectively.
A common practice of the operators was to use zero rates for calls within a fairly high
subscription. This option was offered by Netia, UPC and Vectra (Figure 78).
Figure 78. Prices for domestic and international fixed-line calls
[PLN, VAT incl.]
0,0 0,2 0,4 0,6 0,8 1,0 1,2 1,4 1,6 1,8
Vectra 0,00
UPC 0,00
0,36
TP
0,07
0,55
Telefonia Dialog
0,17
1,48
PTK Centertel
0,20
0,39
PTC
0,17
Netia 0,00
0,30
Multimedia Polska
0,06
1,69
MNI Telecom 0,49
0,11
international long distance local
Source: UKE.
Note: The cost of calls according to the selected tariff plans, based on operators'
tariffs as of 28 November 2011.
53
Prices for calls to mobile networks
All operators applied a single rate for calls to the three largest mobile networks, and
different (higher) fees to the other. For example, calls to a user of the Play network
were on average by PLN 0.30 more expensive than for the incumbent MNOs.
The charges for calls to Plus, Orange and T-Mobile from a fixed-line subscriber
amounted from PLN 0.30 in the PTC tariff to PLN 0.85 in the case of Telefonia
Dialog. The corresponding rates for calls to the Play network amounted to PLN 0.53
(TP) and PLN 1.09 (MNI Telecom), respectively.
The lowest rate was offered by PTC, also the tariff offered by Telekomunikacja
Polska was attractive. As in the case of fixed-line calls, the highest costs for calls
were characteristic for the tariff plan of MNI Telecom (Figure 79).
Figure 79. Prices for calls to mobile networks
[PLN, VAT incl.]
0,0 0,2 0,4 0,6 0,8 1,0 1,2
0,39
Vectra 0,79
0,86
0,39
UPC
0,80
0,32
TP 0,53
0,78
Telefonia Dialog 0,85
0,93
0,40
PTK Centertel 0,75
0,69
0,30
PTC 0,59
0,49
0,32
Netia 0,73
0,89
0,38
Multimedia Polska 0,57
0,86
0,64
MNI Telecom
1,09
Orange, Plus, T-Mobile Play others
Source: UKE.
Note: The cost of calls according to the selected tariff plans, based on operators'
tariffs as of 28 November 2011. The category "others" includes the average cost for
calls to Cyfrowy Polsat, Mobyland and CenterNet.
The value of annual price baskets for individual customers
The lowest average cost for the use of fixed-line telephony was offered by PTC in its
plan "Nowa Taryfa Domowa". It was almost four times cheaper than "Rozmowy non-
stop Europa i świat" by UPC, the last on the list. The attractiveness of this plan was
associated primarily with the low cost of charges for rental, connection and calls to
mobile networks, as well as with the package pre-paid minutes.
54
UPC and Vectra belonged to the group of the most expensive tariff plans, which
resulted from the aforementioned high subscription and included zero rate for fixed-
line calls. This resulted in a small share of voice services in the cost structure. A
different situation took place in the case of MNI Telecom - expensive calls and a
small package of pre-paid minutes resulted in a high average cost of using the
operator's tariff plan (Figure 80, Figure 81).
Figure 80. Structure of costs for the fixed-line telephony service
100% 4,7%
8,5% 5,2% 5,4%
18,6% 25,7%
80%
30,1%
42,6%
60%
100,0% 95,3% 94,6%
91,5% 94,8%
40% 81,4% 74,3%
69,9%
57,4%
20%
0%
fixed fees usage
Source: UKE.
Figure 81. Monthly values of fixed-line telephony baskets
100 92,4
85,9
81,0 81,1
80
[PLN, VAT incl.]
69,2
average 62 63,6
60
47,9 50,0
40
23,4
20
0
PTC PTK Multimedia Telefonia Netia TP Vectra MNI UPC
Centertel Polska Dialog Telecom
Source: UKE and Telecommunications market in Poland in 2011. Individual customers,

report of a consumer survey conducted for UKE by PBS DGA Sp. z o.o. and CBM
Notes: The value of the basket consists of installation and activation fees, the
average value of the subscription for a 24-month period of contract, the cost of 109
used minutes (72 for local calls, 23 for long distance calls, 3 for international calls,
and 11 minutes for calls to mobile networks), packets of free minutes and available
promotions lowering the costs of service. Average monthly amount of a telephone bill
in the last 3 months declared by fixed-line subscribers in a consumer survey.
55
Prices for services in the EU countries
As in the case of Polish operators, in other European countries, a zero rate for
domestic calls was a frequent practice (Spain, Slovakia, Slovenia, United Kingdom,
Denmark and Hungary) or for all types of calls (Belgium) (Figure 82). Poland was
among the countries with the lowest cost for domestic calls for both fixed-line and
mobile networks.
Figure 82. Prices for calls in the selected EU countries
[EUR, VAT incl.]
0,0 0,1 0,2 0,3 0,4 0,5 0,6 0,7
ES 0,46 0,14
FI 0,09 0,48 0,13
CZ 0,01 0,56
NL 0,06 0,24 0,09
PL 0,01 0,35 0,06
IT 0,04 0,56 0,08
BE
IE 0,02 0,22
AT 0,04 0,28 0,08
SK 0,40 0,09
DE 0,02 0,06 0,10
FR 0,03 0,22 0,09
PT 0,01 0,50 0,06
GR 0,01 0,48
LU 0,02 0,19 0,08
SI 0,19 0,11
GB 0,12
DK 0,26 0,06
SE 0,03 0,17
EE 0,01 0,35 0,14
HU 0,41
domestic international to mobile networks
Source: UKE based on the Teligen T-Basket database.

Note: The base as of November 2011. For Poland the doMowy 300 plan by TP was
taken into account. Lack of a category means that the tariff plan included zero rates
for calls or a package of pre-paid minutes in a subscription.
An average monthly cost of using fixed-line telephony services in the EU amounted
to EUR 38.19, including VAT. The TP tariff plan doMowy 300, included in the
summary, was more expensive than the EU average by EUR 5.54 (Figure 83).
56
Figure 83. Monthly values of service baskets in the selected EU countries
60
50
average 38,19
40
[EUR, VAT incl.]
55,93
51,80
30
48,57
47,51
43,73
42,39
42,35
41,52
40,17
39,69
37,23
36,77
36,67
34,29
32,62
31,70
20 30,30
29,11
28,46
28,36
22,74
10
0
HU EE SE DK GB SI LU GR PT FR DE SK AT IE BE IT PL NL CZ FI ES
Source: UKE based on the Teligen T-Basket database.

Note: The base as of November 2011. For Poland the doMowy 300 plan by TP was taken into
account. The value of the basket consists of installation and subscription fees, the cost of 190 used
minutes (150 for fixed-line networks, 25 to mobile networks, and 14 minutes for international calls).
The value of the wholesale market, which includes origination and termination of calls
in the network of a given telecommunications undertaking, the traffic from the
network of another operator originated and outgoing from the network of the
undertaking, and call transit services in the public telephone network, amounted to
PLN 1.46 billion. Compared to 2010, there was a marginal decrease in revenues
from interconnection - 0.5%.
In the structure of revenues, similar to last year, transit played a dominant part. Over
one-quarter revenue was generated by the operators' call termination service
(Figure 84).
Figure 84. Structure of revenues by service type
65,3%
64,7%
80%
70%
60%
50%
28,2%
27,9%
40%
30%
4,1%
20%
3,7%
3,0%
3,0%
10%
0%
call origination call termination call transit other traffic
2010 2011
Source: UKE.
57
Note: The category "other traffic" includes:
- revenues from data transmission calls terminated on the undertaking's own network,
- revenues from incoming SMS to the undertaking’s own network,
- other interconnection services available in the undertaking’s own network.
The total volume of traffic within call origination and termination services amounted to
21.3 billion minutes, recording a slight decrease in comparison to 2010. This
represented primarily the effect of decreasing popularity of termination services.
TP remained the dominant player in the market with the shares of 46.5% in revenues
and 58.7% in the traffic volume (Figure 85). MNI Telecom, T-Systems Polska and
Netia strengthened their position. The companies increased their share in revenues
by 3.2 percentage points, 1.6 percentage point, and 1 percentage point, respectively.
Figure 85. Shares of the operators in the general revenues from the wholesale market for
fixed-line telephony
0% 20% 40% 60% 80%
TP 46,5%
58,7%
Netia 11,4%
9,5%
Media Nowej Generacji 8,0%
MNI Telecom 6,0%

2,5%
T-Systems Polska 5,5%
3,0%
GTS Poland 4,0%
4,7%
Mediatel 3,3%
3,3%
Telepolska 3,0%
0,8%
Telefonia Dialog 2,4%
1,7%
Elterix 1,8%
0,02%
others 8,1%
15,9%
revenues traffic volume
Source: UKE.
5. Investments
The value of infrastructure investments amounted to over PLN 1.06 billion, which
constituted approximately 80.4% of the planned expenditures (Table 1). Most of them
were allocated to access network (92.2%), in which 75 operators decided to invest.
58
Table 1. The value of investment conducted in 2011
Planned investments Completed projects Target indicator
Access network 1 036 034 569 979 725 846 94.6%
Optical fibre 285 479 807 82 949 963 29.1%
network
Total 1 321 514 376 1 062 675 809 80.4%
Source: UKE.
In comparison to 2010, the investment value, both in terms of access network and
optical fibre network, decreased (Figure 86). The plans for 2012 provide for reversal of
this trend and increase in expenditures, particularly in the optical fibre infrastructure,
in which 165 entities intend to invest.
Figure 86. Value of investments
1 800 1608
1 600
1 400
1 200 980 1040
[PLN million]
1 000
800
486
600
400
93 83
200
0
2010 2011 2012
access network optical fiber network
Source: UKE.
Note: Values planned for 2012.
Most of investments implemented in 2011 concerned the xDSL technology, the
second was the 2G/3G network (Figure 87). Copper lines still play a major role in
projects for 2012 (34.7% of the planned investments), but an increase in expenditure
on the cable TV, FTTH, WLAN and 4G infrastructure is expected.
59
Figure 87. Shares of each technology in the value of investments
2,2% 1,6% 0,2%
3,7% 0,2%
29,4%
62,8%
xDSL 2G/3G CATV POTS FTTH 4G others
Source: UKE.
Note: The category "others" includes WLAN, WiMax, FWA and SAT. For the ISDN, Ethernet, and
CDMA technologies, no investments were recorded.
6. Prospects for market development

The dominant trends in the telecommunications market in 2011 included further
growth in importance of mobile solutions, bundling and convergence of
telecommunications services, as well as increase in their availability. Also the
preferences of consumers were changing as they were primarily interested in non-
voice services and their high quality level.
In the following years, the Internet access will remain a strategic segment of the
market, as its penetration rate will gradually increase. A particularly dynamic
development is to be expected in relation to mobile services, affected primarily by
awarding frequency licenses allowing the provision of the LTE services.
Stable growth is predicted for the fixed-line Internet access market, on which the
substitution effect with the mobile offer will have a limited impact. Services at a fixed
location are still perceived as providing better connection quality and reliability.
Customer bases will be expanded especially by the cable TV operators, offering
higher data flow capacity at more attractive prices than in the xDSL technology.
High levels of market saturation means that operators have increasingly limited
opportunities for acquiring new customers, so better management of the customer
base already possessed grows in importance. This will be achieved with package
offers of several telecommunications services; the number of their customers has
been gradually increasing.
Price stops to be the fundamental factor in achieving a competitive advantage. Users
will increasingly pay attention to other-than-cost terms of the offer, expecting
operators to ensure a certain level of service quality.
Successive increase in the number of lines with higher bandwidth will allow recipients
to widely use the high speed Internet offers.
Due to high saturation of the mobile telephony market, the growth opportunities in the
number of users are very limited. In the future, the increase in market penetration will
largely depend on the customers who decide to have more than one SIM card. In
60
addition, operators will endeavour to migrate their pre-paid customers in the direction
of subscription services. These actions will aim to increase ARPU (higher in the post-
paid segment), establish customer loyalty and consequently reduce migration from
the network. A common element inducing customers to use the operator's
subscription services is not only the price but also subsidized devices. Offers
containing larger free packages of services, as well as smart phones offered at lower
prices are to entice the user to sign a contract for a specified period and to increase
the use of operator's services, primarily in respect of data transmission.
Sales of smartphones provides an additional opportunity for operators to increase
revenue from data transmission, which in 2011 was a major field of the competitive
"struggle". A further drop in prices of this service may be expected, resulting in its
increased use.
Increasing popularity of data transmission services abroad will be fostered with new
roaming regulation supplemented with price caps for this service.
Changes in the market share of MVNOs are not to be expected, as their importance
in the coming years will remain marginal.
The growing substitution of fixed-line telephony with mobile telephony influences the
steady decline in consumer interest in the voice services at fixed locations. In
particular, this relates to traditional lines of POTS and ISDN connections. Their
existing users will migrate to mobile networks or buy a bundled fixed-line phone
service, for example with Internet access. These changes will benefit mobile
operators, already having a significant customer base of telephony at a fixed location,
and cable TV operators. The decreasing number of customers will therefore be
limited to the elderly who adhere to the traditional lines, and those using packages of
several services of a given operator.
The phenomenon of convergence will remain an important market process. The use
of variety of electronic communications technologies by the telecommunications
operators will cause further blurring of the existing distinction between voice services
and data transmission.
The analysis of trends characteristic of global markets points to the relevance and
need for investment in the latest generation of NGA networks. While anticipating
these changes, operators will have to gradually increase their investments in optical
fibre networks, especially FTTH.
61
7. List of figures and tables
Figure 1. Broadband Internet penetration rates .......................................................... 6
Figure 2. Penetration per 100 inhabitants of the mobile broadband Internet access in
the EU countries ......................................................................................................... 7
Figure 3. Penetration of fixed broadband Internet access in the EU countries, per 100
inhabitants .................................................................................................................. 8
Figure 4. Number of users in terms of the access technology used ........................... 9
Figure 5. Shares of the operators in terms of the number of users ........................... 10
Figure 6. Value of the market in terms of technologies used .................................... 11
Figure 7. Revenues structure in terms of technologies used .................................... 11
Figure 8. Shares of the operators in the total number of users that use Internet
access services based on xDSL lines ...................................................................... 12
Figure 9. Shares of the operators in the total number of users that use Internet
access services through cable TV modem ............................................................... 13
Figure 10. Shares of the operators in the total number of users that use 2G/3G
modems .................................................................................................................... 14
Figure 11. Shares of the operators in the number of users that use Internet access
service through the LAN-Ethernet technology .......................................................... 14
Figure 12. Penetration of households with fixed-line broadband Internet access
services by type of technology used in the selected EU countries ........................... 15
Figure 13. Throughput in terms of the type of access technology used .................... 16
Figure 14. Average monthly Internet access usage fees for the contract period of 12
months ...................................................................................................................... 17
Figure 15. Average monthly Internet access usage fees for the contract period of 24
months ...................................................................................................................... 17
Figure 16. Average monthly expenses for using the Internet access service ........... 18
Figure 17. Average monthly cost of service in the selected EU countries ................ 18
Figure 18. Average monthly cost of service in the selected EU countries ................ 19
Figure 19. Shares of service bundles in terms of the number of subscribers ........... 19
Figure 20. Shares of the operators in terms of the number of subscribers to the
"cable TV + Internet access" bundle ......................................................................... 20
Figure 21. Structure of the market for wholesale access to the Internet in terms of the
type of infrastructure used ........................................................................................ 20
Figure 22. Shares of alternative operators in terms of the number of BSA lines ...... 21
Figure 23. LLU penetration in the number of all xDSL lines ..................................... 21
Figure 24. LLU penetration in the number of all xDSL lines in the selected EU
countries ................................................................................................................... 22
Figure 25. Nominal number of users and nominal market penetration in Poland ..... 23
Figure 26. Penetration of the mobile telephony market in the European Union ........ 23
Figure 27. Number of mobile phones owned (private and business) in a household 24
Figure 28. Share of customers of post-paid and pre-paid services........................... 25
Figure 29. Shares of the operators in terms of the number of users ......................... 26
Figure 30. Shares of the operators in terms of revenues .......................................... 26
Figure 31. Shares of the operators in terms of revenues from voice calls ................ 27
Figure 32. Shares of the operators in terms of SMS sent ......................................... 27
Figure 33. Duration of outgoing voice calls and the dynamics of change ................. 28
Figure 34. Number of SMS sent in Poland and the dynamics of change .................. 29
Figure 35. Number of MMS sent in Poland and the dynamics of change ................. 29
62
Figure 36. Data transmission volumes (in MB) and the dynamics of change ........... 30
Figure 37. Duration of outgoing voice calls in the EU per one active user (min)....... 30
Figure 38. Number of SMS sent in the EU per one active user ................................ 31
Figure 39. Numbers ported from the network and to the network of the operator .... 32
Figure 40. Maximum retail prices declared by individual customers ......................... 32
Figure 41. Prices for domestic voice calls made by users ........................................ 33
Figure 42. Prices for domestic SMS sent by users ................................................... 33
Figure 43. Prices for domestic MMS sent by users .................................................. 34
Figure 44. Prices for domestic data transmission realised by users ......................... 34
Figure 45. Prices of monthly service baskets for moderately active mobile users from
the selected 18 countries in the European Union ..................................................... 35
Figure 46. Duration of outgoing voice calls while roaming and the dynamics of
change ...................................................................................................................... 36
Figure 47. Number of SMS sent while roaming and the dynamics of change .......... 36
Figure 48. Data transmission volumes (in MB) in roaming and the dynamics of
change ...................................................................................................................... 37
Figure 49. Maximum prices for roaming services as declared by individual customers
................................................................................................................................. 37
Figure 50. Prices for voice calls made by roaming users within the European Union 38
Figure 51. Prices for SMS sent by roaming users within the European Union ......... 38
Figure 52. Prices for MMS sent by roaming users within the European Union ......... 39
Figure 53. Prices for 1 MB of roaming data transmission in the European Union..... 39
Figure 54. Structure of revenues in the interconnection market ............................... 40
Figure 55. Shares of the operators in terms of revenue in the interconnection market
................................................................................................................................. 41
Figure 56. Shares of the operators in terms of duration of terminated calls in the
interconnection market ............................................................................................. 41
Figure 57. Share of duration of calls originating in mobile and fixed-line networks,
terminating on a mobile network ............................................................................... 42
Figure 58. Market value and the number of subscribers ........................................... 43
Figure 59. Number of lines by technology ................................................................ 43
Figure 60. Shares of lines by technology in the EU countries................................... 44
Figure 61. Revenue structure by service elements ................................................... 44
Figure 62. Revenue structure by type of outgoing calls ............................................ 45
Figure 63. Traffic volume per subscriber and the monthly average number of minutes
per subscriber ........................................................................................................... 46
Figure 64. Structure of the traffic volume .................................................................. 46
Figure 65. Structure of traffic volume for business clients and consumers ............... 47
Figure 66. Shares of call types in the volume of traffic in the EU countries .............. 47
Figure 67. Shares of the operators in terms of the number of subscribers and the
amount of revenues in 2011 ..................................................................................... 48
Figure 68. Revenue structure of TP and AO by service elements ............................ 48
Figure 69. Revenue structure of TP and AO by types of calls .................................. 49
Figure 70. Shares of TP and AO in the traffic volume .............................................. 49
Figure 71. Shares of alternative operators in the use of the WLR service ................ 50
Figure 72. Numbers ported from the network and to the network of the operator .... 50
Figure 73. Number of subscribers and the traffic volume for VoIP services ............. 51
Figure 74. Shares by the number of users ............................................................... 52
Figure 75. Shares by the obtained revenues ............................................................ 52
Figure 76. Shares by the number of users ............................................................... 52
63
Figure 77. Shares by the obtained revenues ............................................................ 52
Figure 78. Prices for domestic and international fixed-line calls ............................... 53
Figure 79. Prices for calls to mobile networks .......................................................... 54
Figure 80. Structure of costs for the fixed-line telephony service ............................. 55
Figure 81. Monthly values of fixed-line telephony baskets ....................................... 55
Figure 82. Prices for calls in the selected EU countries ............................................ 56
Figure 83. Monthly values of service baskets in the selected EU countries ............. 57
Figure 84. Structure of revenues by service type ..................................................... 57
Figure 85. Shares of the operators in the general revenues from the wholesale
market for fixed-line telephony.................................................................................. 58
Figure 86. Value of investments ............................................................................... 59
Figure 87. Shares of each technology in the value of investments ........................... 60
Table 1. The value of investment conducted in 2011 ............................................... 59
8. Glossary of terms
ARPU – average revenue per user- average monthly revenue per subscriber
ISP – Internet Service Provider- provider of the Internet access service
AO – alternative operator
xDSL – X Digital Subscriber Line – including technologies such as: ADSL, CDSL,
HDSL, IDSL, RADSL, SDSL, VDSL
TVK – technology of Internet access via cable modem of the cable television
operators
WLAN – Wireless Local Area Network - local wireless network for which the Internet
access is offered only through radio to the subscriber's device
LAN-Ethernet – Local Area Network - local wired network built according to the
Ethernet standard
CDMA – Code Division Multiple Access - multiple access with code division of signal
WiMax – Worldwide Interoperability for Microwave Access – wireless technology
based on the 802.16 standard
FWA – Fixed Wireless Access - fixed-line wireless access
Modem 2G/3G – a mobile device dedicated to broadband Internet access in the form
of a card, key or a modem. This category does not include mobile phones through
which users can connect to the Internet.
FTTB – Fibre To The Building - optical fibre line pulled to a building and forming a
part of distribution network
FTTH – Fibre To The Home - optical fibre line pulled to the end-user's house and
ended in his premises, on the outside wall of his premises, or no more than 2 meters
from the outer wall of his premises.
LLU – Local loop unbundling - access to local subscriber loop and sub-loop
BSA – Bitstream Access wholesale broadband access service
64
LTE – Long Term Evolution - standard for data transmission in the mobile telephony
NGA – Next-generation Access - access networks of next generation
MTR - Mobile Termination Rate - rate for call termination in the network of mobile
telephony operator
MVNO – Mobile Virtual Network Operator – operator providing mobile telephony
services based on the infrastructure of another operator
MNO – Mobile Network Operator – operator of mobile telephony with its own
telecommunications infrastructure
PSTN – Public Switched Telephone Network
POTS - Plain Old Telephone Service - basic analogue telephone service that allows
voice communication through switched lines
ISDN - Integrated Services Digital Network- digital network with integrated services
WLR – Wholesale Line Rental - wholesale Internet access service
Prepared by:
Department of Telecommunications Strategy and Market Analysis
65

Report On The Telecoms Market in Poland 2011

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Report On The Telecoms Market in Poland 2011

Uploaded by

Copyright:

Available Formats

+

Report on the telecommunications market in

Warsaw, June 2012

23,0% 24,5% 26,0%

per 100 inhabitants per household

Source: UKE based on Digital Agenda Scoreboard 2011.

Source: UKE based on Digital Agenda Scoreboard 2011.

3,0 2,82 2,84 2,79

20% 41,8% 38,0%

TP Netia PTK Centertel Telefonia Dialog others

24,7% 22,4% 19,1%

15,4% 21,7% 22,5%

20% 39,2% 33,9% 30,8%

Internetia MNI Telecom Aster

22,9% 12,9% 10,1%

21,2% 11,3% 23,9%

16,6% 2,4% 23,9%

14,4% 5,6% 25,4%

DSL CTV modem others

Source: UKE based on Telecoms Market Matrix, Analysys Mason database.

TP AO's own infrastructure

TP AO's own infrastructure

above 100 3,0%

I do not know/hard to say 5,3%

Source: UKE based on Telecommunications market in Poland in 2011. Individual customers,

Source: UKE based on Teligen T-Connect.

Source: UKE based on Teligen T-Connect.

100% 1,8% 4,4% 5,9%

Netia PTK Centertel PTC Telefonia Dialog others

Source: UKE based on Telecom Market Matrix, Analysys Mason database.

Source: UKE based on Telecom Market Matrix, Analysys Mason.

Source: UKE based on Telecommunications market in Poland in 2011. Individual customers

Source: UKE based on Telecom Market Matrix, Analysys Mason database.

Source: UKE based on Telecommunications market in Poland in 2011. Individual customers

Source: UKE based on the Teligen database.

3.2.2. Prices for roaming services

Source: UKE based on Telecommunications market in Poland in 2011. Individual customers

market value number of subscribers

POTS ISDN WLR CTV xDSL

PSTN ISDN CTV

Source: UKE based on Telecom Market Matrix, Analysys Mason database.

0,2% 0,3% 0,5%

80% 42,0% 41,5% 38,2% 38,2% 40,6%

60% 9,4% 9,7%

14,9% 15,9% 14,5% 13,7%

20% 36,6% 37,7%

100% 10,2% 11,4% 12,5% 14,0% 15,5%

business 47,4% 26,4% 3,4% 22,7%

residential 66,5% 20,8% 2,4% 10,3%

0% 20% 40% 60% 80% 100%

local long distance international to mobile networks

domestic international to mobile networks

Source: UKE based on Telecom Market Matrix, Analysys Mason database.

4.1.4. Shares of TP and AO

0% 20% 40% 60% 80%

60% 29,7% 31,2% 26,8% 25,8% 24,8%

TP fixed fees TP calls AO fixed fees AO calls

Netia 17,6% Telefonia Dialog

0,80 0,79 0,80

0,60 0,59 0,60

traffic volume in own network

Aiton Caldwell Netia Tartel Voxnet others

Netia Aiton Caldwell others