Kosovo – Government nears sale of 75% interest in telecom incumbent

Kosovo has benefited from financial and regulatory assistance as part of the EU pre-accession process, The EU remains Kosovo’s main trading partner and its main source of foreign direct investment.

Telecom sector overview

The country’s telecom sector has been liberalised, with new legislation introduced in late 2012 to align with the EU’s revised regulatory framework. It also adopted measures relating to competition and to facilitating the market entry of new players. Nevertheless, poor telecom infrastructure has meant that fixed-line penetration remains low by European standards. Unlike most markets, the fixed-line broadband sector is dominated by new players, in particular the cable operator IPKO which has upgraded its network with DOCSIS3.0 technology.

Broadband market

Broadband penetration in Kosovo is developing slowly, with effective competition between the main cable and DSL operators. There are a number of smaller ISPs, though the sector is dominated by only two players. Cable accounts for the majority of connections, and though the incumbent PTK is building out an upgraded fibre-based NGN investment has been insufficient.

Mobile market

The mobile sector accounts for most lines as well as the greater part of telecom revenue. Two MNOs compete with two MVNOs, though the latter have a very small market presence. The prepaid sector accounts for the vast majority of subscribers, though it is gradually losing ground as more contract subscribers sign up for services. Mobile data services will become increasingly important in coming years as a source of new revenue growth.

Kosovo – Key telecom parameters – 2010; 2012

Sector

2010

2012 (e)

Subscribers to services (thousand)
Fixed-line 83 85
Fixed broadband 126 144
Mobile phone 1,450 1,570
Penetration rate by service:
Fixed-line 4.4% 4.9%
Fixed broadband 6.1% 8.4%
Mobile phone 70% 90%

(Source: BuddeComm based on industry data)

Market highlights:

  • Competition in the liberalised telecom market has been facilitated by the 2012 Law On Electronic Telecommunications which aims to ease the market entry of new players. Nevertheless, continuing poor investment in the sector has meant that fixed-line telecoms penetration in Kosovo remains among the lowest in Europe.
  • Broadband availability through DSL, cable and wireless services is being supplemented by nascent FttX deployments. Poor infrastructure means that rural broadband is still dominated by wireless access: WiMAX networks offer near universal population coverage, though data speeds are commonly about 256Kb/s, which severely limits internet functionality.
  • Digital TV programming is available from the cable TV operator IPKO. The country’s main broadcasters have formed a consortium to promote digital terrestrial TV development.
  • Competition in the mobile market is secured by two MNOs and two MVNOs, though the latter have a limited presence. Relatively high mobile penetration showcases the sector’s popularity as a customer response to poor fixed-line infrastructure.

For detailed information, table of contents and pricing see:

Kosovo – Telecoms, IP Networks, Digital Media and Forecasts

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