Polkomtel holds to strategy

Polkomtel, the country's second-largest mobile operator, will stick with its strategy of offering more value-added services to low-end customers during the next few years and probably retain its brand name, Mirosław Bielicki, the firm's vice president and information technology director, told the WBJ last week. Competition in Poland for mobile users is still tight among Polkomtel and its competitors, Polska Telefonia Cyfrowa (PTC), the country's largest wireless operator, and PTK Centertel. Polkomtel, which until recently had specifically targeted more lucrative corporate clients with post-paid mobile services, has turned its attention to cornering the pre-paid market of budget-conscious subscribers who pay lower costs for mobile services, but offer more potential for revenue growth. Of its more than 3.8 million subscribers at the end of the second quarter of this year, Polkomtel had 1.8 pre-paid subscribers vs. 2 million post-paid ones. Pre-paid clients generated average monthly revenue per user (ARPU) of zł. 33, a 4.6% decrease compared to the same quarter in 2001. Post-paid subscribers generated about zł. 149 per month, a 12.4% drop vs. the same period last year.

But rather than continue to reduce tariffs to attract more pre-paid users, Bielicki said that Polkomtel would focus on pushing value-added services, such as short message service (SMS), to try to increase ARPU among pre-paid users. "It's the right way to go because the Polish market is entering a new phase of growth," said Anna Bossong, the director of Eastern Europe telecom research at CA IB in London. In 2001, pre-paid subscribers accounted for about 40% of all wireless customers for Poland's three mobile phone firms, a figure that is expected to increase to 62% by 2005, according to the IT research firm IDC. Polkomtel also plans to retain its Plus brand name for now, Bielicki said, despite a recent false press report that the firm had decided to use a logo of Vodafone, the British mobile operator that owns 19.6% of Polkomtel. The report came as Polkomtel's rival, Centertel, owed by France Telecom (FT) and dominant operator Telekomunikacja Polska (TPSA), is considering adopting the logo of FT's mobile company Orange. Centertel might make the switch as a marketing tactic to boost its acquisition of new high-end subscribers in an effort to replace Polkomtel as the country's second-largest operator. "We have a strong brand that is recognized by most Poles," Bielicki said, although he didn't dismiss the idea of rebranding Polkomtel's service in the future. "We never say never, but if the development of the market, plus the offer from our partners and the decision of the remaining shareholders (is made), then we can consider such an alternative," he said.