This week, the Commission published the latest figures on the European Electronic Communications Sector, which includes country reports and charts with the aim of illustrating the progress of the policy actions and the key performance targets1 in this sector across Europe. Below is an analysis of the major indicators that relate to Malta.

Investment in

telecommunications

The Commission reports that the latest available data, as at 2010, indicates that Malta ranks third in the EU with respect to investments undertaken by the telecommunications sector. In fact, investment was boosted in 2009 by the network deployment of the new mobile operator and continued to increase in 2010 mostly due to significant investment in the upgrade of broadband networks. Such investments reached €46 million, that is, 20.7 per cent of 2010 revenue.

Internet

In its report, the Commission stated that Malta is “one of the top EU performers for fixed broadband penetration” noting that broadband penetration continued to grow, reaching 30.9 per cent in December 2011, ahead of the EU average of 27.7 per cent. With a growth of 1.4 per cent, Malta is one of the four countries in the EU that presents both a penetration level and growth rate above the EU average.

The Commission noted that Malta was considered as having achieved the Digital Agenda for Europe target, aimed at securing a basic broadband connection for all EU households by 2013. “This is not only due to the geography of the islands or to the presence of two ubiquitous infrastructures; it is also linked to a strong public policy focus on ICT,” it stated.

The Commission also notes, in particular, the increasing popularity of bundled offers, with approximately 54 per cent of all fixed broadband subscriptions forming part of a bundle.

The report states that as at December 2011, most Maltese consumers were subscribed to packages with download speeds of between 2 and 10 Mbps. As regards consumers having connection speeds above 10 Mbps, although the report captures a moderate increase to 24.6 per cent as at December 2011, most broadband lines in Malta were in the range of 2Mbps and below 10Mbps (75.1 per cent), well above (31.7 per cent) the EU average rate of 43.4 per cent of lines in this speed range. The Authority notes that various upgrades to broadband speeds have been introduced on the market since December 2011 so that, at the end of March 2012, broadband lines above 10 Mbps increased significantly to 47.37 per cent above the EU average as at December 2011, which stood at 48.4 per cent. Subscriptions in the range of 2Mbps and below 10Mbps have, at the same time, decreased to 52.30 per cent.

Mobile broadband penetration is 21.2 per cent, up by 8.9 per cent year-on-year but is still significantly below the EU average penetration level of 43.1 per cent.

With regard to Next Generation Broadband Networks, the Commission notes positive developments in particular with the upgrading of the cable network, which allows customers to reach up to 100 Mbps in download speed. This places Malta in third place in the share of high speed broadband lines as a percentage of total broadband lines (46 per cent compared to the EU average of 12 per cent). Despite this progress however, the take-up of high-speed (30 Mbps) and very high-speed broadband (100 Mbps) offers remains marginal.

The Commission notes positively that “Malta is one of the few member states that has adopted measures to include access to a broadband connection in the national universal service”. Since 1 August 2011, these measures have ensured that all subscribers, irrespective of the area where they live, are able to have a connection with a speed of 4 Mbps.

With regard to the provision of broadband via Next Generation Networks, the report states that significant steps have been taken by Malta, while noting that following its feasibility study carried out in 2011, the Maltese government unveiled its decision to actively promote the deployment of a nationwide open-access Fibre-to-the-Home (FTTH) network.

Telephony

In the mobile telephony sector, the number of subscriptions per inhabitant is reported at 118 per cent. The Commission noted that “competition between the three main players has also intensified”. Nevertheless, the market entry of the third operator did not have an immediate impact on the level of prices: in 2010, Maltese customers were charged the highest mobile tariffs in the EU, with an average revenue per minute of €0.21 compared to the EU average of €0.11. Since then however, the latest calculations of the MCA show that the average revenue per minute at the end of 2011 has declined steadily to €0.122 (including international calls) and €0.119 (excluding international calls).

Broadcasting

On the broadcasting front, the Commission took note of the new free-to-air digital terrestrial platform, which is now fully operational and carries six Maltese broadcasters that meet general interest objectives. Digital switch-over was completed on 31 October 2011 when the analogue broadcasts were switche off.

The Commission noted that “the digital pay-TV scene remains characterised by intense competition between the two commercial players, Melita plc and GO plc, which have launched new products on the market (IPTV and Video on Demand).”

Spectrum management

The scoreboard also refers to the MCA’s successful conclusion of the reassignment of spectrum in the 900 MHz and 1800 MHz bands. This was the first time that the MCA reassigned spectrum that was already in use for the provision of mobile communication services. Spectrum licences were subsequently awarded to Melita Mobile Ltd, Mobisle Communications Ltd and Vodafone Malta Ltd respectively. The report also duly notes the satisfaction of mobile operators with regard to the efficient and balanced approach adopted by the Authority in the assignment process.

Transposition of

new telecoms framework

The timely transposition of the reviewed EU Electronic Communications Directives into Maltese law is also highlighted. This process, which was completed in July 2011, introduced amendments to the Malta Communications Authority (MCA) Act, the Electronic Communications (Regulation) Act and various subsidiary regulations enacted under this Act.

Appeals to MCA Decisions

The Commission noted that most appeals against decisions of the MCA are still pending before the Communications Appeals Board. In this regard, since 1 June of this year, the government decided that appeals would no longer be heard by the Communications Appeals Board, but by the Administrative Review Tribunal. 

Co-deployment and

facility sharing

With regard to co-deployment and facility sharing, the Commission reports a lack of clear boundaries between the powers of the Malta Communications Authority and Transport Malta. The government is providing a framework for rationalizing these procedures as part of the Fibre-to-the-Home project.

Card Sharing

The Commission noted the market players’ concern regarding the use of satellite card-sharing and its consequences on the value of content rights. The Authority recognises these legitimate concerns and notes that a number of court cases have been instituted in this regard.

Commenting on this report, Ing Micallef, chairman Malta Communications Authority said: “Malta continues to experience important year-on-year growth in all the key electronic communications sectors. This is particularly satisfying given the current difficult economic situation. The Authority’s work is now focusing not only on sustaining and strengthening the level of competition attained in this sector, but also on ensuring constant improvement in quality of service and consumer protection.

“The MCA is also pleased to be helping the government with a project aimed at facilitating the deployment of an FTTH network. This will assist in the provision of ultra fast broadband, which in turn will support a host of innovative, high-quality services,” he added.