26 May 2016
2015: a year of exceptionally high investments
Totalling €10.6 billion, including spending on frequencies, operators' investments increased sharply in 2015 (+50.2% in one year) due to 700 MHz frequency band allocations on which €2.8 billion were spent. More significantly, investments excluding spending on frequencies also reached a record high of €7.8 billion, which marks a more than 10% increase over the previous year.
Meanwhile employment levels continue to decrease apace with previous years.
Link between investment, connectivity and regulation
As indicated in its December 2015 report on mobile operators' spending (1), Arcep stresses that their Capex constitutes an investment indicator that needs to be completed by other considerations. In the telecommunications sector, improvements in quality of service, for instance, must also be measured, along with progress in coverage levels. Expenditure expressed in only monetary terms is not an end goal in itself: public authorities in general, and Arcep in particular, must view connectivity and a sustained rate of investment over the long term as the real objective.
Arcep's pro-investment regulation has been established in this spirit: in its regulatory choices, Arcep is working to promote efficient investment, in other words which improves consumer satisfaction directly and which, thanks to competition, ensures investment over the long term which is beneficial to the whole of society.
It was to this end that, on 25 May 2016, Arcep published guidelines for mobile market stakeholders on the terms and conditions governing mobile network sharing between operators that hold frequency licences (2) and that, as part of its review of fixed broadband and superfast broadband market analyses, the Authority is working on measures that will help accelerate the transition from broadband to superfast broadband, and help businesses migrate to superfast access solutions.
On 30 June 2016, when it publishes its annual report, Arcep will review the different aspects of its regulation geared to stimulating investments in infrastructure and innovation.
Decrease in operators' revenue down to -2.6% in 2015, compared to -4.0% in 2014
Operators' revenue stood at €32.6 billion excl. VAT in 2015 (€35.9 billion excl. VAT when including ancillary sources of revenue such devices). This confirms that the rate of decrease for their revenue is slowing: -2.6% in 2015 compared to -4.0% in 2014 and -7.2% in 2013. The trend is particularly visible in the mobile services market whose rate of decrease (-3.2% in 2015) has shrunk by three time over two years, thanks to increasing consumption and smaller decreases in mobile prices: -5.5% in 2015 versus 10.6% in 2014 and -26.6% in 2013.
Consumption habits continue to evolve as users make increasing use of mobile data services, which are flourishing, whereas messaging and mobile calling traffic are increasing only moderately.
With the number of users on 4G networks doubling in one year (now representing one in three SIM cards), and rising usage on 3G networks (two-thirds of all SIM cards), data traffic climbed to 560,000 Terabytes in 2015, which marks an 83% increase year on year (YoY). This translates into average traffic of up to 1.2 Gigabytes a month per mobile internet user. Despite the popularity of instant messaging on mobiles, sending SMS remains a common and growing practice: an additional 5 billion text messages were sent compared to 2014, for a total of just over 200 billion text messages in 2015. Mobile calls account for two thirds of all voice calls, a proportion that continues to grow year on year due to a rise in mobile traffic (+3.2% in 2015) and the concomitant decrease in calls originating on fixed networks (-7.9% in 2015). Overall calling traffic (fixed and mobile) in France decreased for the second year in a row (-1.1% YoY).
Use of fixed and mobile high-speed services also on the rise in France's overseas departments and territories
Two outstanding features of French overseas markets are the high rate of mobile ownership (2.7 million SIM cards, which translates into a penetration rate of 123.9%) and the heavy use of prepaid cards, which account for up to 75% of the base in Mayotte. The revenue earned by operators in overseas markets stood at €1.2 billion excl. VAT in 2015, of which €711 million for mobile services, which marks a slight decrease (-1.5%) over the previous year. As in Metropolitan France, consumption habits are evolving, with the growing adoption of fixed broadband and superfast broadband plans (+3.3% YoY), which are being bundled more and more with a voice over broadband service (50% of telephone subscriptions) or a pay-TV plan (45% of subscriptions). Two thirds of calling traffic originates on mobile networks (+5.9% YoY), despite which fixed calling traffic increased by 3.6% on the year thanks to the widespread use of VoBB. Mobile data traffic increased by 38.1% compared to 2014, due to an increase in the number of 3G users (+37.5% or 45% of all SIM cards). SMS traffic, on the other hand, has been on the decline for two years in the departments of Antilles and Guyana, bringing the number of text messages sent down to 4.7 billion in 2015 versus 5 billion in 2014.
2015 annual observatory (pdf - 1.05 Mo) (provisionnal figures) (in French only - pdf)
2015 annual observatory - French OVERSEAS markets (pdf - 550 Ko) (provisionnal figures) (in French only - pdf)