The Dutch 5G market is still waiting for spectrum auctions in the 3.5 GHz and 26 GHz bands: timing for mmWave auctions has not been finalized, while the planned 3.5 GHz auction in April 2022 has been suspended until further notice following a request to the courts from the current user, Inmarsat. As such, it is a market fully focused today on 5G in the sub-3 GHz band and a market that is seeing encouraging results in terms of network performance, revenue improvement, and energy efficiency. KPN in particular is in a strong position on all these counts.

While VodafoneZiggo launched 5G services in April 2020 using DSS, both KPN and T-Mobile waited until the conclusion of July 2020 spectrum auctions (in the 700, 1400 and 2100 MHz bands) to launch services. KPN acquired 2x10MHz of spectrum in the 700 MHz band, 15MHz at 1400 MHz, and 2x20MHz at 2100 MHz band. The 700 MHz Band n28 has been the key band used by KPN, with the 1400 and 2100 MHz spectrum used initially for 4G services.

Out of a total of 5,000 radio sites, KPN had modernized 4,000 by the end of 2021 to support 5G in Band n28, an increase of over 1,000 sites during the year. This gave it a 5G population coverage of 81% and it expects to reach 95% coverage by the end of 2022. In addition to delivering 5G, network modernization is also improving services to 4G users with faster speeds and more capacity and is using less energy. While T-Mobile has built out 700 MHz 5G at a faster rate, covering 98% of the population, it is KPN’s 5G network which is regularly winning performance tests.

KPN is Leading on 5G Network Experience

The network modernisation program has helped KPN to win the umlaut connect Mobile Benchmark for the Netherlands for the first time in 2021/2022 with a globally rare ‘outstanding’ grade from a score of 976 that narrowly beat T-Mobile’s 972. For 5G performance, across all umlaut’s drive test and walk test scenarios, KPN achieved the highest data rates in the 7 second download test. On coverage, umlaut noted that ‘KPN leads in terms of 5G coverage in the bigger cities, while T-Mobile provides the highest share of 5G coverage in the smaller towns, on the roads and on railways.’

Elsewhere, in March 2022, Opensignal ranked KPN as the leading Dutch operator in terms of 5G experience. Based on data collected between 1 November 2021 and 29 January 2022, it was ‘the outright winner of the 5G Games Experience and 5G Download Speed awards, while also being a joint winner for 5G Video Experience, 5G Voice App Experience and 5G Upload Speed alongside T-Mobile.’ 5G download speeds were 187.0 Mbps at KPN, 131.5 Mbps at T-Mobile, and 76.3 Mbps at Vodafone Ziggo.

These results line up closely with those from Ookla, which has ranked KPN as the best mobile network in the Netherlands in its last three bi-annual awards. These awards included the prize for Netherlands’ Fastest 5G Mobile Network, with KPN coming out top in terms of download speeds, upload speeds, and latency.

Sub-3 GHz 5G Supporting KPN’s Green Development Goals

KPN is committed to becoming carbon neutral without offsets by 2030 and to be net-zero by 2040. It is working hard in this area and in its 2021 annual report it noted that ‘for the fifth time in a row, KPN was ranked as one of the top-five most sustainable telecom companies in the world according to the Dow Jones Sustainability Index (DJSI).’ It has used 100% green electricity generated by local and European wind farms for many years, though remains focused on reducing its overall energy consumption. Against its 2010 benchmark, it has reduced energy consumption by 45% and believes its network modernisation will help it to hit targets of 49% by 2023 and 55% by 2030. That 45% reduction in 2010-2021 energy consumption has been achieved alongside a 24x increase in data traffic across its fixed and mobile networks.

KPN’s network modernisation and simplification has been central to its energy savings. Phasing out of the legacy TDM/PSTN fixed network has been a major contributor, though the mobile network is also playing an increasing strong role. Mobile network modernisation has included deployment of ultra-wideband technology at cell sites, reducing the physical resources needed to support multiple frequency bands, while migration to more efficient 4G and 5G is also significant. At the start of this month, KPN began to phase out its 3G network (which carries only 1% of mobile data traffic) which will make a strong contribution to further energy savings. Re-farming sub-3 GHz spectrum from 2G and 3G to 4G and 5G will play an important role in reaching KPN’s environmental goals.

Network Performance and Energy Efficiency Leading to Business Success

Having a more efficient and better performing network is one thing, but is this really helping to drive business performance at KPN? Well, across its services portfolio, KPN has seen mobile (as well as fixed) support continued growth in B2C revenue and a turnaround in SME revenue, though the Corporate segment is a little behind. Fixed and mobile broadband network improvements have contributed to:

• B2C net promoter score rising from +11 in Q4 2020 to +16 in Q4 2021;
• B2B net promoter score rising from -2 in Q4 2020 to +4 in Q4 2021;
• Improving revenue growth, after consistent mobile service revenue declines since 2017, with year-on-year revenue growth of -3.7% in Q1 2021, 0.2% in Q2, 2.0% in Q3 and 2.2% in Q4;
• Mobile data traffic increasing by over 30% in 2021, on par with the 35% increase the regulator reports for the whole market;
• Most importantly, greater profitability enabled by improving revenue growth and tight cost control delivered by the more efficient networks, with underlying net profit up 13% in 2021.

KPN has shown that 5G success can be built on sub-3 GHz deployments. It’s leading 5G network performance in the Netherlands, and the network modernisation and simplification prior to access to 3.5 GHz and mmWave spectrum, is an interesting use case for other operators. This is delivering strong 5G coverage and performance, greener network operations, and increasing value, service revenue, and profitability.