BMI's 2010 report on the Norwegian telecommunications industry contains updated growth forecasts for the development of the country's mobile, fixed-line, broadband, internet and 3G subscriber markets, taking into account trends witnessed in a mature market possibly feeling the additional negative impacts of the global economic downturn. These forecasts have also been extended to 2014, but generally reflect slower growth than previously expected over the latter part of the period under assessment. To begin on a positive note, we believe the mobile market grew faster in 2009 than previously expected, particularly as Telenor completed the integration of certain resellers and service providers into its marketing channels, and capitalising on its increased high-street and online presence. The company also enjoyed some success in migrating low-cost prepaid su bscribers to more valuable postpay services, which served to stabilise ARPU. It was also successful in growing its 3G and mobile broadband businesses, particularly as it became more adept at offering smartphones and other rich media mobile devices while improving the scope of its value-added services. TeliaSonera -owned NetCom did less well in 2009, but still managed to grow its market share almost as fast as Telenor. The MVNO sector performed less well, though this may be attributable to the exit from the market of certain players as they fell under the thrall of Telenor and newcomer Mobile Norway . The latter began providing services via Telenor in 2009 and will launch its 2G/3G network in 2010; equipment supply contracts were signed in 2009. BMI believes that 2009 ended with a total of 5.334mn mobile subscribers in Norway. This would equate to a penetration rate of 111%. It would also represent a y-o-y increase of 3.4%. However, we continue to believe that saturation of the market is at hand. The latest regulatory data suggest that there were 1.613mn broadband customers in Norway at the end of June 2009; this is equivalent to around 70% of households and almost 34% of the country's inhabitants. The number of broadband connections grew by 10.4% in 2008, with growth notably down from the 15.1% rate of expansion recorded in 2007. For 2009 as a whole, we envisage growth of just 3.4%, taking the number of subscribers to 1.64mn. Recent data suggest that xDSL growth is waning, while growth in the number of cable and fibre-based broadband connections remains strong. Due to a faster than expected fall in fixed lines during 2008 and 2009, BMI has revised existing forecasts for the next five years. The number of fixed lines fell by 3.3% in 2007 and by 4.5% in 2008. In H109, the regulator reported a 5% y-o-y fall in the number of lines; BMI forecasts a 5.8% decline for 2009 overall. This would take the number of lines in service down to 1.79mn, a penetration rate of 37.2%.
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