Subscribers:
In the first quarter of 2006, Swisscom net revenue
has decreased (-2.9% year-on-year) as a result
of harsh competition and tariff reduction by the
incumbent and other providers in the country.
Despite the overall decline in net revenue, the
DSL segment has shown a positive year in terms
of subscriber and revenue gain. The positive DSL
momentum will generate revenues with the Triple
play (telephony, broadband Internet and television
over the telephone line), VDSL and VoIP.
At the end of March 2006,
the total number of retail DSL connections amounted
to 775,000 (40.9% year-on-year), whereas the wholesale
DSL lines number rose to 441,000 (+29.2% year-on-year);
while the number of fixed lines in service decreased
to 3.118 million (-2.4% year-on-year). Furthermore,
a solid increase was also recorded in the number
of Internet users, the total number of which stood
at 1,165 million (+10.95% year-on-year).
Revenues
of Internet traffic accumulated to March stood
at 10.32 million Euro, a year-on-year decrease
of 3.87% mainly as a result of the tariff reduction
by the incumbent and migration of dial-up subscribers
to flat rate DSL services.
DSL
Packages
starts from 29 Euro for a flat rate of 600 Kbps
for the residential
market to 127 Euro for a flat rate of 600Kbps
for the professional market. There is no recurring
cost (Installation, Set-up and modem) for residential
subscribers whereas a DSL professional package
with speeds of up to 2Mb costs as little as 50
Euro. There is a one-off activation cost of 322
Euro for professional packages.
Price elasticity:
According to the result of our price elasticity
analysis of Swisscom broadband tariffs for Q1
2005 and Q1 2006, the demand for DSL broadband
is elastic to the change of tariffs, as the arc
elasticity ratio is -1.969. In other words, for
every drop in the cost of bandwidth by one Euro
there was a net gain of 5,700 new subscribers
since Q1 2005.
For more information about
this press release or this research brief, please
contact us at info@quantum-web.com
About Quantum-Web:
Quantum-Web is a leading provider of broadband
tariff research and analysis. It provides broadband
quarterly statistics, pricing analysis, consultancy,
and tailored reports, product of both a deep technological
understanding and a first-rate research methodology.
Quantum-Web uses a variety
of econometric models, statistical techniques
and in-depth market behavioural analysis to provide
comprehensive market intelligence in the broadband
sector. Our services include:
• Broadband
Statistics
• Broadband Tariffs
• Broadband Consultancy
• Tailored Reports
