BUSINESS

Price war hurts mobile phone companies

VANGELIS MANDRAVELIS

TAGS: Business

Not only did the Greek cell phone market suffer another year of contraction in 2016, but the rate of that contraction was sharper than in 2015.

Figures from the Association of Cell Phone Companies (EEKT) showed that the sector’s total revenues declined 5.9 percent on an annual basis last year, dropping from 1.87 billion euros to 1.78 billion, while service revenues fell 4.5 percent. Operating profits posted another small drop, from 720 million euros to 702 million.

The only ray of light, according to EEKT general director Giorgos Stefanopoulos, was that the last quarter of 2016 saw revenues swing to positive, going some way toward containing the losses recorded in the first three quarters. That may signal the stabilization of the mobile phone market, he argues.

The drop in the sector’s revenues once again appears to be the product of the strong competition among the sector’s enterprises. Despite the increase in the use of services, the price war continues to eat into revenues and profits, while subscribers increased 1.5 percent, voice calls rose 1.7 percent and data use was up by a staggering 75 percent.
 

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