A drop in household disposable income and an increase in unemployment have contributed to a reduction in the electronic communications sector's retail revenues - in 2013, revenues in Portugal fell by 6.4 percent. In the postal sector, the trend in postal traffic continues to decline, as a result of substitutability by electronic communications services and exacerbated by the economic crisis - in 2013, total postal traffic declined by 6 percent.
Portugal's economic recovery is unlikely to be swift or easy, and the communications business will likely face a difficult economic environment over the next few years.
However, in recent years, the strong dynamism of the Portuguese communications market has resulted in the growth of fixed and mobile broadband Internet access services and of subscription television services. At the same time, major structural changes have been seen, driven by prevailing economic conditions and emerging new technological possibilities.
In particular, Portugal has seen the merger between ZON and Optimus (becoming NOS Comunicações) and the acquisition of Onitelecom by Grupo Altice (which already controlled Cabovisão). There was also the merger agreement between PT and the Brazilian operator Oi, which, while having no direct impact on the structure of the Portuguese market, may determine changes in terms of strategic positioning.
These movements in the market have created conditions which accelerate convergence, especially between mobile and fixed infrastructure. As a result, a new dynamic has been instilled in the sector, including through the strengthening of convergent offers, allowing the appearance of quadruple-play and quintuple-play bundles with mobile and fixed voice offers, mobile and fixed broadband Internet, and subscription television. This has resulted in increased competition, which in turn has driven the appearance of offerings with increasingly competitive pricing, bringing benefits to consumers.
The agreement signed between PT Comunicações and Vodafone Portugal, in July 2014, to share optical fibre networks is a significant innovation which must be thoroughly evaluated by ICP-ANACOM, particularly in the context of market analysis.
Increased competition in the market and the increased consumption of bundled services has resulted in higher fixed broadband and subscription television service penetration and in a growing number of fixed service residential customers, as well as an increase in the penetration of mobile broadband.
Portugal also has high combined coverage of FTTH networks and EuroDOCSIS 3.0, allowing download speeds of 30 Mbps or higher (82.8 percent at the end of 1st quarter 2014). In terms of mobile broadband, coverage by Long Term Evolution networks (LTE) had reached 91.3 percent by the end of 2013. These values give Portugal some of highest levels of broadband network coverage in Europe.
The availability of these networks has fuelled the offer of bundles of different services and enabled new businesses such as cloud computing, which may provide telecom companies with new business opportunities.
At the same time, such networks enable further advances in the digitalisation of the economy and of society. Dematerialisation is a reality and is increasing the number of services that are provided online, by both businesses and government. Services of e-government, e-education, e-procurement, e-commerce, e-banking and electronic payments are all based on telecommunications and on technologies, and can make all the difference in terms of rationalisation, efficiency and improving quality of life for populations.
Meanwhile, the postal sector remains under pressure from competition from electronic communications. Overall traffic volumes continue to decline, largely due to the possibility of substitution of traditional postage by electronic communications. Meanwhile, areas associated with e-commerce, such as express mail and parcel traffic, despite reporting growth, are not yet large enough to compensate for the reduction in traditional business.
These pressures have led postal operators to seek new areas of activity, including international expansion, in search of new opportunities for growth not currently offered by the Portuguese market.
The recent privatisation of CTT - Correios de Portugal (70 percent of company's capital) may also contribute to the introduction of a new dynamic in the sector.
ICP-ANACOM will continue, with every effort, to maintain the right regulatory environment that will continue to allow the communications sector to develop. This Plan is intended as an instrument in accomplishing this environment.
