A1 Telekom Austria

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In 2017, competition in the Austrian mobile market continued to be driven by aggressive promotions including high data allowances in the mobile no-frills business but also data monetisation in the contract business. In this context, A1 Telekom Austria AG is monetising the growth in demand for data by including high data allowances and data roaming in the premium tariffs. As of November 2017, these also included 'zerorated' services enabling certain music and video streaming services to be used independently of data limits. At the same time, it is addressing the price pressure in the no-frills segment via its no-frills brands bob and YESSS!, for example by means of competitive national tariffs. The company has also introduced attractive regional promotions and targetgroup-oriented products, for example for the youth segment.

The fixed-line business profited from the increased demand for broadband products with a higher bandwidth. In this context, the hybrid modem—a combination of fixed-line and mobile network—remains a central factor, in addition to classic fibre products, in enabling A1 fixed-line products to be offered with higher bandwidths. As of 1 August 2017, monthly fees were increased for existing customers in the fixed-line business. In the Austrian broadband market, mobile Wi-Fi routers with unlimited data offers also remain an important element. Convenient unlimited mobile broadband offers therefore complete A1's data-centric premium package. On 26 June 2017, A1 increased the available download speed in its mobile and fixed-line broadband offers to up to 300 Mbps.

In the year under review, the total number of mobile communication subscribers declined by 1.9 % year-on-year, entirely driven by a decrease in the number of prepaid customers. At the same time, the high demand for mobile Wi-Fi routers and high-value tariffs resulted in an increase in postpaid customers. The market share in mobile communications declined to 38.8 % in the year under review (2016: 39.4 %). In the fixed-line business, revenue-generating units (RGUs) decreased by 3.0 % in 2017 due primarily to loss of voice RGUs. While demand for fibre upgrades remained strong and TV RGUs continued to exhibit solid growth (+4.5 % year-on-year), fixed-line broadband RGUs declined by 2.3 % year-on-year. This was attributable both to the ongoing substitution by mobile Wi-Fi routers and to the above-mentioned price increase of 1 August 2017, which resulted in increased churn.

Total revenues in the Austrian segment increased by 2.0 % year-on-year in the year under review, including the positive one-off effects described above in the total amount of EUR 14.2 mn in Q1 2017. Excluding these effects, total revenues rose by 1.4 %. The rise was driven by higher solutions & connectivity and interconnection revenues in the fixedline segment, increasing revenues from fixed-line services in the residential business as well as higher revenues from the sale of handsets. Revenues from fixed-line services in the residential business increased as the lower airtime revenues were more than offset by higher broadband revenues thanks to strong demand for products with a higher bandwidth and the above-mentioned price increases as well as increased TV revenues. In the mobile business, the lower revenues from mobile services were due to the negative effects from the stepwise abolition of retail roaming in the EU as of 30 April 2016 and 15 June 2017 as well as losses in the prepaid segment. This was somewhat compensated for by increased revenues in the mobile broadband business and the postpaid segment. Revenues from the sale of mobile handsets increased due to higher quantities sold and an updated handset portfolio with a shift to higher-value devices.

The average monthly revenue per user (ARPU) declined year-on-year from EUR 15.8 in 2016 to EUR 15.6 in 2017, which was attributable primarily to negative roaming effects. Excluding roaming, the ARPU in the year under review would have risen slightly in comparison with the previous year. The average monthly revenue per fixed line (ARPL) increased from EUR 28.0 in 2016 to EUR 29.3 in 2017. This was primarily due to upselling measures in the broadband business as well as the above-mentioned price increases.