Broadband in Poland: a fast evolution

Poland is nowadays one of the most developing countries in European Union (EU). We analyze this case in collaboration with Piotr Paluch. After joining the union in 2004, the dynamic process of “catching up” to the rest of the Western Europe countries have started and it also includes major progress in the area of broadband and communication. Today Poland is becoming a leader in that branch with a lot of innovative technologies and systems to improve the speed and solidity of the countries broadband.

In 2012, 65% of the population of the country have used the Internet. These numbers are growing every year. Also according to official website of the Polish Ministry of Treasury, by 2016, more than 50% of the inhabitants will have access to the broadband internet, while the number of connection lines will reach 6,6 millions and 9 millions in 2018 (from the prediction analysis done by PwC).

The biggest Internet providers in Poland are Orange Polska (former Telekomunikacja Polska) with its ADSL service Neostrada and Net24 provided by Netia, however the download speed of their services oscillates between 10Mb/s and 80Mb/s. The cable network UPC provides the fastest Internet in the country and can achieve up to 250Mb/s download speed and 20Mb/s upload speed in the biggest urban areas like Warsaw, Krakow, Poznań or Wrocław.

 

Source: http://point-topic.com/wp-content/uploads/2014/08/Poland-Operator-Retail-Market-Share-Q4-2013.png

Today, similar to most of the developed EU countries, Poland is witnessing the rise in the optic fibre infrastructure and the loss in the copper-wired Internet access. The cable providers have already prepared for the changes and a lot of them have already started using the fibre architecture, but the biggest provider Orange is still working mostly on the copper wires, which means slower networks. That might lead to slow change in the market and cable companies might be overtaking it, as they provide higher speeds and also competitive pricing on their services.

The problem, which Poland is facing, is the lack of backbone broadband networks in the smaller cities and rural areas. That is caused by lack of communication between the local governments and private companies, which provide services. “The local governments are not fully aware of the way an efficient internet provider works: what are its duties and rights, how to increase market share and revenue sources, which will guarantee a proper functioning of the networks,” – says the the Head of Analysis Department at Audytel, telco and IT consultancy – Grzegorz Bernatek. He also indicates that the local goverments don’t know how the commercial market functions and how to make a good agreement with the provider to match the demands of the citizens. The other phenomenon connected with private-public partnership is that local authorities often choose the small companies instead of the large ones to build the network infrastracture. Suprisingly, it often works, as the small companies can build a more compact and efficient networks, which would be unprofitable for the big companies. However the quality of these networks is not as good as the ones from the largest providers.

In the future the consolidation of the broadband market seems unavoidable. Today Polish market is relatively fragmented when compared with other European countries. Poland alongside Romania are the only EU countries with more than 1000 Internet providers in the country. That shows how big, but also how divided, the broadband market is. We still have the copper-wires providers like Orange and Netia, cable TV providers, who also sell Internet service like UPC and Vectra and also local providers who gain a lot of customers in their areas like Inea in Poznan and Toya in Lodz. Small, neighbourhood-sized companies cover the rest of the market. “Such fragmentation, rather unusual in Europe, will lead to consolidation. It will happen because it’s cheaper for bigger entities to buy equipment and big companies have a better position against so-called OZZPA (organizations of collective rights management) when negotiating the distribution of TV content,” – says Witold Tomaszewski, the chief editor of telepolis.pl online magazine. He adds that however the micro companies are said not to survive on the market for long, he disagrees with this statement and says that from the previous experience he thinks that the little providers can still find the place on the market like they did before.

Except the Internet services, Poland is also an advanced country in terms of TV broadcasting. Nowadays the most common TV service is the terrestral broadcast using digital television channels (DVB-T systems), which users are allowed to watch by paying for the Television and Radio License. This service includes National TV channels (all in HD) as long as some private stations. Additionally to this basic option, a lot of citizens are currently using the satellite TV providers. The two major companies are NC+ and Cyfrowy Polsat (which is the fourth largest digital platform in Europe), which provide a lot of channels including foreign ones, which are not available for the terrestral broadcast users; 33% of the population of Poland is said to use the satellite TV services according to the resarch done by the website wirtualmedia.pl. That puts satellite service in the second place after the cable TV (35%). The biggest providers for the cable TV are UPC and Vectra, which provide television alonsgide with the high-speed Internet as I said before. According to the same research, 72% of population is satisfied with their TV and Internet providers.

To conclude, Poland is now witnessing the high raise of the broadband market. It’s targets are strictly matching the ones set by the European Commission’s Digital Agenda for Europe (DAE) and according to its plan by 2020, 100% of the households and companies should have access to the Internet connectivity of at least 30Mb/s. The national broadband plan focuses on promoting broadband investments and expansion through initating regulatory measures. The Act on supporting development of services and telecommunication networks allows the local goverments to benefit from the European funds for broadband rollout. It also simplifies administrative procedures and facilitates private investments by infrastructure sharing. The future of this area is bright and Poland should soon become one of the European leaders in terms of broadband and innovation in this branch. 
We analyze international broadband evolution (in this case, Poland) in this blog, in Research Group about Digital Journalism and Marketing and Broadband and in Research Group on Innovative Monetization Systems of Digital Journalism, Marketing and Tourism (SIMPED), from CECABLE,  Escola Universitària Mediterrani of UdG, UPF and Blanquerna-URL, in Twitter (@CECABLEresearch), Google+, in the group of LinkedIn, in the page of LinkedIn, in the group of Facebook, in Instagram (CECABLE), in Pinterest and in this blog. We will go in deep in the XXII Cable and Broadband Catalonia Congress (4-5 April, 22@, UPF).