Telekom made the 5G network available to its customers on all the capital city’s subway lines
Magyar Telekom has made its 5G network available to customers on all Budapest subway lines, which they can use with a 5G-capable device and mobile internet service. From July 1, 2024, the telco first turned on 5G in the parts of the underground that are accessible to the traveling public, then the 5G service became available on the M2 line from mid-August, the M4 line from the end of September, and the M3 line from 11 November.
The operator said development carried out in the framework of its network modernisation program took into account the continuous growth of customers’ voice and data traffic needs. The multi-year program includes a base station overhaul and not only affects active and passive radio technical devices, but also includes the infrastructure necessary for their placement and operation.
As part of the program, the company modernised nearly 30% of its mobile stations in 2022, increasing the number of modernised base stations to 60%. A significant proportion of the modernised base stations also underwent capacity expansion.
New frequencies
Telekom’s 5G technology is available on 700MHz, 2100MHz and 3600MHz, with the current development, 5G will typically be extended on the 700MHz frequency. As a result, from 1 June 2023, the telco’s 5G network was made available in Budapest, in the county seats, in many rural towns and villages and around Lake Balaton, Lake Velence and Lake Tisza.
Telekom said it customers use their mobile devices more and more intensively on the subways as well: their mobile data traffic measured on the subway lines has doubled in the recent period. The mobile voice and data traffic of the metro network is similar to that of a city of 20-30 thousand people.
In terms of data traffic, the busiest station of the entire Budapest metro network is Nyugati pályaudvar, where there is as much data traffic as on the M1 line in total. And its latest measurements show that since 5G was switched on, both mobile voice and mobile data traffic has increased among its customers on the metro lines.
In order to use the 5G network, in addition to 5G coverage, Telekom said a suitable price package, a 5G-capable device, and at least a 4G-capable physical SIM or eSIM are also required. Telekom makes 5G automatically available free of charge to all its customers, who can use it with a 5G-capable device and mobile internet service.
Telekom’s progress
The metro installation confirms the telco’s steady progress in delivering on its 5G modernisation plan. It has a solid leading position in the Hungarian mobile market with a market share of about 45%. The second and third largest players lag well behind with a share of around 25% each. In fact, ratings agency Scope has noted that Magyar Telekom’s domestic market shares in several segments exceed those of most telecom operators in Europe.
It isn’t all smooth sailing though. To cope with the steep inflation in Hungary (headline inflation of 14.5% and 17.6% in 2022 and 2023 respectively), Magyar Telekom implemented two consecutive, annual, inflation-linked price increases in March 2023 and March 2024.
Last month, Magyar Telekom agreed on an average 6 percent differentiated wage increase with the interest representatives operating at the company for 2025. In addition, the telco agreed to pay a one-time bonus of HUF 745,000 gross to all employees, plus increase the annual allowances related to health services available to staff. However the telco announced 120 job cuts that will happen by Q1 2025.
Some of the extra pressures the telco faces and country-specific, i.e. telecoms and utility taxes. With the supplementary telecom tax (equivalent to about 3.5% of revenues in 2023) scheduled to be abolished from January 2025 onwards Scope is expecting EBITDA improvements for the telco. The utility tax removal has already helped Magyar Telekom’s broadband ARPU.