TDC Group Annual Report 2011(6,4MB) - TDC Annual Report 2011

Performance in 2011
Revenue
Wholesale’s revenue decreased by 81m or 3.6% from 2010
to 2011, largely as a result of a reduction in landline
broadband and landline telephony RGUs and the negative
effects stemming from increased regulation.
Landline telephony
In 2011, the market for traditional landline telephony
continued to decrease as the demand for mobile-only
solutions grew and customers increasingly migrated to VoIP
solutions. Wholesale continues to resell access to other
landline telephony operators with new market approaches
or a specific segment focus.
The method for calculating regulated wholesale prices was
changed in 2011 and led to a further reduction of the
PSTN/ISDN price in July, which had a negative impact on
revenue. The full-year effect of this price decrease will be
seen in 2012.
The international interconnect volume in Wholesale also
decreased in 2011, which was only partly compensated for
by higher revenue on national IC.
Revenue split, Wholesale
Internet and
network
41.2%
Other
8.7%
Landline
telephony
22.4%
Mobility
services
27.7%
TDC Group Annual Report 2011
Mobility services
The total number of domestic traffic minutes from MVNO
customers increased significantly from 418m in 2010 to
647m in 2011, and was the main driver for the DKK 10m or
1.7% increase in mobility services. However, the mobile
price war continued in 2011, putting ARPU from SPs under
pressure, while price regulations also negatively affected
revenue from international roaming.
Wholesale aims at achieving closer cooperation with
customers on products, systems and process development.
For instance, this has led to an increased focus on brand
partners. Consequently, in August 2011 the Danish
discount retailer Netto launched the mobile product
‘Nettalk’, while the retailer Coop launched ‘Coop Mobil’ in
December 2011, both using Wholesale’s subsidiary
Companymobile. Early results show that the products have
been well received by end users.
Internet and network
Revenue from internet and network activities decreased by
4.8% from 2010 to 2011.
ARPU on BSA and xDSL resale decreased significantly in
2011, as a result of regulated BSA prices and transfer of
high-ARPU customers on the fibre network to Consumer.
Lower revenue from co-location activities also contributed
negatively. The decline was partly offset by an organic
increase in BSA and xDSL RGUs. Wholesale’s ULL RGU base
decreased significantly in 2011, but was primarily a result
of large business customers moving from TDC's
competitors to Business. The revenue decrease from ULL in
Wholesale was therefore largely counterbalanced in
Business.
In order to mitigate the reduced revenue caused by
regulation, Wholesale increased its focus on unregulated
products, such as capacity. This led to continued strong
growth, primarily within Nordic IP-VPN and Nordic capacity
services. However, stagnating demand for domestic
capacity negatively affected revenue from capacity.
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