Mobile market report: Italy

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The Italian mobile market is unlike other European mobile markets in that its network operators do not subsidise handsets and its customers tend to buy devices entirely separately of mobile airtime.

It is the kind of model that UK network operators considered properly a few years back, and which they now have tended towards with the introduction of SIM-only contracts and extended airtime subscriptions.

But the Italian market is entirely dominated by prepay. The penetration rate of mobile in Italy is the second highest in Europe, with 151 per cent. (Greece has 187 per cent, and the UK has 125 per cent).

It has around 60 million inhabitants and 88.4 million ‘live’ mobile connections – 12 million more than the UK. Virtually all are on prepay, which, because of the focus and competition, offers comparable value to subscription packages in the UK.

Consumer loyalty is low, churn is high. Many customers take multiple prepay SIMs and use them depending on the value they get for particular network services.

The market as a whole is one of the first in Europe to start contracting – in part because it is undergoing a ‘data cleanse’ of customers to remove inactive and extremely low-spending customers from their books.

TIM (Telecom Italia Mobile) has already shed around three million subscribers this year, and reported a corresponding rise in ARPU.
TIM leads the Italian market with a 37 per cent share (32.6 million customers), down from 40 per cent in June.

Full article in Mobile News issue 454 (December 14, 2009).

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