Tiscali 2014 Annual Report Download - page 7

Annual financial report as at 31 December 2014
Date
File Name
Status
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Annual Report as at 31
December 2014
7
3 Report on Operations
The Tiscali Group availed itself of the faculty to present the Parent Company report on operations and
the consolidated report on operations in a single document, assigning greater importance, where
appropriate, to the significant questions for all the companies included in the scope of consolidation.
3.1 Tiscali’s position within the market scenario
Tiscali is one of the leading alternative telecommunications operators in Italy offering a wide range of
services to its private and business customers: internet access through DSL, Voice, VoIP, media,
added-value services, mobile telephone services, communication and Over The Top services.
In addition, Tiscali is active in the digital media and on-line advertising segment via its www.tiscali.it
portal and other web properties which are marketed by the concessionary agent Veesible S.r.l..
With regard to broadband access from the fixed network, during 2014, the number of accesses was
down slightly which further confirmed the saturation of the segment and emphasises the importance of
price and customer retention policies so as to counteract the tendency of a rise in the churn rate and
to win over customers from direct competitors.
In order to respond to the competitive pressure and the growing band request from the market, it is
necessary to extend the range of the offers to the public, by means of increasing the transmission
capacity offered.
With a view to this, Tiscali expects to introduce ultra broadband offers using FTTC and FTTH
technologies during 2015 by means of availing of the Telecom Italia Virtual Unbundling Local access
range.
In the market of direct access to the fixed network, Tiscali maintains an essentially stable position,
thanks to the integrated voice and data offers. A comparison of September 2014 data with September
2013 data in fact shows that Tiscali's market share was down slightly, from 3.7% to 3.4%.
Dual-play access was confirmed as the most commonly used commercial proposal by consumers and
business users, even if single play represents an interesting alternative for mobile only customers.
By contrast, Internet access from mobile devices continues to rise sharply, drawn along by Tablets
and Smartphones, by internet keys and the increasingly greater development of mobile applications
both by media on-line and companies.
In the mobile sector, Tiscali disclosed a satisfactory performance in 2014 thanks to the good results in
the upselling and communication strategy in addition to a competitive voice-sms and data range, with
an increase of 137% in the number of operating SIMs in 2013.
With regard to the broadband access market, coverage by the traditional operators continues
(Telecom Italia, Fastweb, Wind Infostrada, Vodafone) who compete in the market place with different
price, communication and added value service strategies.
In the second half of 2013, the online advertising market showed for the first time a decline in the total
turnover although less significant than reported by the traditional media. The slowdown is certainly due
to the economic downturn and to a definite increase in the overall advertising offerings, both traditional
and online, which erodes unit prices. Thus a turnaround in a more than a decade-long trend, which
however does not invalidate the long-term vision which is confirmed.
In particular, it is possible to consider with reasonable certainty that the weight of on-line advertising in
Italy will align itself over the mid-term at levels observable in the majority of the western economies.
The Company in any event hypothesises growth in media revenues over the next few years,
attributable to the envisaged expansion of the user base and the network of the concession holder