Daiwa EuroTelcoblog No. 74: Tuesday 14th September 2004 - UPC Netherlands fires the opening shot

UnitedGlobalCom unit UPC Netherlands today launched the Dutch VoIP service which we wrote about recently (http://eurotelcoblog.blogspot.com/2004/08/daiwa-eurotelcoblog-no_10.html), and unveiled some specifics. Monthly subscription to the service is said in the press release to be "almost 50% less than" KPN's basic subscription (which is EUR15.26), with per minute calls priced 10 - 15% cheaper. The launch will initially be confined to Amsterdam and Rotterdam, expanding to the rest of the country early next year. Also, as previously announced, UPC will increase bandwidth for cable modem subscribers significantly from 1st October, with the top range product moving up to 8Mbps.

Also in the offing for October is a commercial trial of a 30Mbps cable modem product, followed by commercial launch, as well as a separate trial of a 50Mbps solution in Amsterdam. This latter development may have been prompted by some of the municipal fiber projects we have written about in the Netherlands (http://eurotelcoblog.blogspot.com/2004/07/daiwa-eurotelcoblog-no_23.html), and we're intrigued to know what the technology behind the trial is. Cable is producing some very intriguing alternative infrastructure solutions these days, such as Pulse_LINK (http://www.pulselink.net/) which harnesses Ultra Wideband over coaxial cable to deliver 1.2Gbps downstream and 480Mbps upstream. Whatever the motives and whoever the suppliers, this announcement from UPC today of a double-punch from VoIP and bandwidth upgrades, if replicated by the other two major MSOs in the Dutch market (Essent and Casema), may represent a real hammer-blow to KPN's residential business, and underlines our rationale for an UNDERPERFORM rating.