Weak economy, subsidy withdrawals contribute to shrinking Spanish mobile market

Weak economy, subsidy withdrawals contribute to shrinking Spanish mobile market

13 FEB 2013
Spain

New figures from the Spanish regulator reveal that mobile lines in the country shrunk by 2.77 million last year as recession-hit consumers continued to cut costs.

Spain’s Telecommunications Market Commission (CMT) said that mobile connections in the country fell to 55.8 million at the end of December 2012.

Market-leader Telefonica lost more than 3 million mobile connections, while second-placed Vodafone Spain lost 1.6 million. Both players are thought to have suffered customer defections after withdrawing handset subsidies during the year. Rivals Orange and Yoigo, which continued to offer subsidies, recorded smaller declines.

According to a Reuters report, Vodafone reintroduced smartphone subsidies in November but still ended the year on a 26 percent market share, down two percentage points from a year earlier.

All four Spanish operators have been impacted by Spain’s gloomy macroeconomic conditions. The country’s contracting economy has triggered a sharp decline in private consumption and pushed up unemployment to around 25 percent

However, there was brighter news in the broadband sector. Spain counted 11.6 million broadband lines at end-2012, up 3.7 percent year-on-year.

“Broadband was the only area that showed year-on-year growth, thanks to a push from alternative operators,” said the CMT.