RA: competition concerns in key markets
Two providers dominate the electronic communications sector on the island, the latest market analysis from the Regulatory Authority of Bermuda shows.
The report, which covers the 2019 and 2020 calendar years, reveals that One Communications and Digicel Bermuda continue to be sector leaders.
The significance of that dominance was identified by the RA in its September 2020 market review when it noted there were “competition concerns in seven of the 15 markets across four of the six services: broadband, mobile, fixed voice and business connectivity”.
One and Digicel were identified by the RA as having significant market power in one or more of these categories.
The most recent market analysis shows that One has a 47 per cent share of the overall EC sector, while Digicel has a 42 per cent market share.
The sector includes fixed, mobile, internet, leased lines and subscription television.
The fixed network services market is characterised by consumer equipment in a fixed location and used to make/receive calls, send/receive faxes and support broadband services.
Total fixed line revenue in 2020 was $13.1 million, a decrease of six per cent from the 2019 figure of $14 million.
The fixed line market made up 7.14 per cent of the overall EC market by revenue in 2020, a small change from 7.02 per cent in 2019.
The Digicel Group (which includes Bermuda Telephone Company) has approximately 80 per cent of the fixed network market as of December 31.
One Communications increased its share in the market from 12.67 per cent in 2019 to 16.43 per cent in 2020.
The remaining market was split between Link Bermuda (3 per cent), Telebermuda International (less than one per cent) and Fort Knox Bermuda (less than one per cent).
There were 17,276 residential subscribers in 2020 (2019: 19,048) and 11,496 commercial subscribers (2019: 11,281).
The residential fixed-line market penetration rate for Bermuda fell from 68 per cent in 2019 to 61 per cent in 2020.
The average residential subscriber paid $33.61 per month in 2020, up from $31.14 a year earlier.
Total broadband revenues in 2020 were $66.8 million, a decrease of 9.96 per cent from the 2019 figure of $74.1 million.
The broadband market in 2020, which made up 36.4 per cent (2019: 37.23 per cent) of the overall EC market by revenue, was dominated by One Communications (57.29 per cent) and Digicel (39.43 per cent).
The remaining market was split between TBI (1.66 per cent), Link Bermuda (1.15 per cent), and Fort Knox Bermuda (0.47 per cent).
In 2019, the market split was One (61.84 per cent), Digicel (35.72 per cent), Link (1.28 per cent), TBI (0.69 per cent), and FKB (0.47 per cent).
The fixed broadband penetration rate for Bermuda was 96.79 per cent in 2020 (2019: 96.99 per cent).
The average monthly spend per user for broadband in 2020 was $121.02 (2019: $140.16).
The average broadband subscription speed was 139Mbps (2019: 59Mbps).
There were 37,892 broadband subscriptions on the island in 2020 (2019: 37,252), and 58,124 mobile phone subscriptions (2019: 59,152).
One Communications held 55 per cent of the mobile market in 2020 (2019: 54 per cent), while the other sectoral provider, Digicel, held 45 per cent (2019: 46 per cent).
The mobile segment made up 41.39 per cent of the overall EC market by revenue in 2020 (2019: 37.12 per cent).
Total revenue from mobile networks increased by 3 per cent in 2020 to $75.9 million (2019: $73.9 million).
Commercial mobile revenue was up 38 per cent to $33.6 million (2019: $24.4 million), and residential mobile revenue declined by 15 per cent to $42.3 million (2019: $49.5 million).
The subscriber base in 2020 was made up of 52,119 residential (2019: 52,316) and 6,005 commercial subscribers (2019: 6,836).
The number of handsets in the market was 171,491 in 2020 (2019: 171,524).
Revenue from roaming declined by 69 per cent in 2020 to $1 million (2019: $3.3 million).
The average monthly revenue per residential mobile subscriber in 2020 was $67.65 (2019: $78.88).
The average monthly spend per user for mobile prepaid in 2020 was $94.27 (2019: $113.05). For mobile post paid, the average was $62.47 in 2020 (2019: $71.59).
The subscription TV market made up 9.61 per cent of the overall EC market by revenue in 2020 (2019: 9.82 per cent).
Total revenue from subscription TV in 2020 was $17.62 million, a drop of 9.82 per cent from 2019 ($19.54 million).
The RA said: “It should be noted that despite reporting subscribers in each period, several sectoral providers were unable to provide revenue figures associated with those subscribers.
“This will be resolved in future reports.”
The number of subscribers in 2020 was 15,049 (2019: 16,385).
One Communications held the lion’s share of the market in 2020 at 79.14 per cent.
The remaining four providers were Digicel (10.75 per cent), World on Wireless (9.02 per cent), and TeleBermuda International and Fort Knox Bermuda, each of which held less than a 1 per cent market share.
In 2019, One held 81 per cent, Digicel held 10 per cent and WoW held 9 per cent.
The retail leased line (international) market was worth $7.4 million in 2020, a drop of 6 per cent from 2019’s figure of $7.9 million.
The market made up 4.05 per cent of the overall EC market by revenue in 2020, an increase from 3.99 per cent in 2019.
The RA, which is Bermuda’s electronic sector watchdog, said its report for the 2019 and 2020 calendar years was based on data provided by the sectoral providers in the autumn of 2021. It added that data was also sourced from EC sectoral providers’ quarterly financial reports to the RA and from the government Department of Statistics.
The organisation said the 2019-2020 report should be considered in the context of the Covid-19 pandemic and resultant measures taken by the Bermuda government to reduce the impact of the virus.
In particular, the RA said, usage of EC services was affected by increased home working, technology solutions that enable continued communication such as internet-based meetings, and fewer travellers both inbound and outbound.
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