BMI's Executive Summary

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In the first six months of 2007, the number of Greek mobile subscribers grew by 8.7% to reach 15.305mn. Despite the already very high penetration rate, which is now over 137%, we envisage 2007 being another strong growth year for the Greek sector. Although we originally predicted a growth rate of 7.45% for 2007 as a whole, the higher than anticipated growth rates for Q107 and Q207 resulted in us making significant revisions to our forecast. Our latest set of forecast figures envisage a total of 15.963mn mobile subscribers by the end of 2007. This reflects a 2007 growth rate of 13.4%, which is similar to that experienced in 2006. By the end of 2007, Greek mobile penetration was expected to reach 143%. Nevertheless, the reported operator figures continue to contain a significant number of inactive subscribers. Looking ahead, we anticipate that the operators may begin discounting inactive accounts from their figures, and this could lead to significant adjustments to our forecast data. In the meantime, prepaid customers continue to grow at a faster pace than postpaid subscribers, and this market feature continues to depress ARPU levels.

One of the biggest ongoing sagas in Greece's telecoms market concerns the future ownership of national incumbent operator OTE. Following the successful placement, in June 2007, of a 10.7% stake in national OTE, Greece's Finance Ministry announced in October 2007 that it would not 'actively seek' the further privatisation of the former monopoly telco. The government's attempts in early 2006 to attract a major European telecoms company to invest in OTE failed. However, at the end of September 2007, it was reported that Greek company Marfin Investment Group (MIG) was considering making a bid to acquire a controlling stake in OTE. MIG was reportedly considering the launch of a bid in the region of EUR2bn (US$2.8bn) for a 20% stake in OTE, which would include some management influence. It was also reported that MIG might participate in the possible placement of part of the government's 28% OTE stake. News reports have also mooted the possibility that MIG could seek a strategic partnership with a foreign telecoms operator, in order to gain overall control of the Greek incumbent.

Meanwhile, at the beginning of August 2007, it was reported that Greek electricity utility Public Power Corp (PPC) had accepted a EUR175mn (US$240mn) offer from telecoms holding company Weather Investments, for the acquisition of its 50%-minus-one-share stake in Greek alternative telco Tellas. The conclusion of deal ensures that Weather Investments, which is itself owned by Egyptian tycoon Naguib Sawiris, gains 100% ownership of Tellas. It also paves the way for Weather to offer bundled fixed-line and internet services, along with offerings from its recently acquired Greek mobile operator Wind Hellas (formerly TIM Hellas). Weather Investments previously paid US$3.4bn to acquire TIM Hellas and its subsidiary Q-Telecom from private equity firms Apax Partners and Texas Pacific in February 2007.

Contents

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Chapter 1 - Executive Summary

Chapter 2 - Industry Forecast Scenario

Fixed-Line

Table: Greece Telecoms Sector Fixed-line Historical Data & Forecasts

Internet

Table – Greece Telecoms Sector Internet Historical Data & Forecasts

Mobile

Table: Greece Telecoms Sector Mobile Historical Data & Forecasts

Chapter 3 - Macroeconomic Climate

Consumer Demand To Strengthen In 2007

State's Contribution To Activity Weakens

Investment Outlook Brightens On Tax Cuts

Trade Performance Worsens But Likely To Improve

Table: Economic Growth

Real Income Convergence To Continue

Chapter 4 - Country Snapshot: Greece Demographic Data

Section 1: Population:

Table: Demographic Indicators (2005)

Table: Rural/Urban Breakdown

Section 2: Education & Healthcare

Table: Education

Table: Healthcare: Vital Statistics

Table: Healthcare: Expenditure

Section 3: Labour Market And Spending Power

Table: Employment Indicators

Table: Consumption and Stratification

Chapter 5 - Business Environment

Eastern European Markets

Greece

Greece Telecommunications Industry SWOT Analysis

Chapter 6 - Competitive Landscape

Market Structure

Table: Key Players: Greece Telecoms Sector

Table: Selected Operator Financial Parameters

Key Players

Fixed-Line

Table: Regional Fixed-Line Penetration Overview

Internet

Table: Regional Internet Penetration Overview

Mobile

Table: Regional Mobile Penetration Overview

Market Data Analysis

Fixed-Line

Internet

Mobile

Table: Greece Mobile Market, Q306

Table: Greece Mobile Market, Net Additions, 2006

Table: Greece Mobile Market, ARPU, 2005-6

Industry Developments

Chapter 7 - Company Monitor

Regional Case Study: Alcatel

Table: Alcatel Recent European Contract Wins

Hellenic Telecommunications Organisation (OTE)

Vodafone

TIM Hellas

Chapter 8 - BMI Forecast Modelling

How we generate our industry forecasts

Telecommunications Industry

Sources

Chapter 9 - Appendix: Regional Demographic Data

Wages (ave labour force per annum), US$ PPP

Population

Household Spending Per Capita, US$

Private Consumption Per Capita, US$ PPP

Market Size, GDP, US$bn

Competitive Landscape for Europe Telecommunications Reports: Sample of Companies Ranked

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Commentary on key operators highlighting ownership structures, latest available revenue figures, market share analysis and ARPU counts. BMI forecasts for all headline macroeconomic indicators, including real GDP growth, inflation, fiscal balance, trade balance, current account and external debt. Company SWOTS Covering all leading telecommunications operators and manufacturers operating in each market, including competitive intelligence on geographic presence and competitive positioning against local companies; local market share; leading products, services and technologies; foreign direct investments, projects, merger and acquisition strategies.

Network of European Telecommunications Sources

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BMI's European Telecommunications Reports are based on an extensive network of multilateral organisations, government departments, telecommunications industry associations, chambers of commerce and company reports. Information sources include:.