Overview
Information about the sector’s regulatory framework and latest activities can be found on the BiH Communications Regulatory Agency’s (CRA) website.
Bosnia’s telecommunications sector was divided along ethnic lines following the 1992-1995 war. In the Federation, service is split between the Sarajevo-based BH Telecom in Bosniak-majority areas and Mostar-based HT Mostar in Croat-majority areas, while Banja Luka-based M:Tel (Telekom Srpske) covers the entire territory of the Republika Srpska.
In December 2006, M:Tel was privatized via a sale to Telekom Srbija, the dominant fixed-line and mobile telephone provider of Serbia, whose government owns a controlling interest in the parent company. The Federation government owns controlling shares in BH Telecom and HT Mostar. The CRA awarded the three operators 4G licenses in April 2019. The mobile phone market currently is estimated to have around 98 percent market penetration. M:Tel has been expanding steadily both in the Republika Srpska and in the Federation. BH Telecom’s subsidiary, BH Mobile, and HT Mostar’s Eronet, maintain dominant positions in their traditional market areas.
A notable development is the appearance of broadband Internet service deployed via cable television. In years to come, more providers will be able to offer a “triple package” of phone, Internet, and cable service.
In March 2019, BC Partners, a leading international investment firm, announced the completion of the acquisition of majority ownership of United Group (SBB/Telemach) from the U.S. investment fund Kohlberg, Kravis, Roberts (KKR), following the receipt of all necessary regulatory approvals. Telemach is the leading cable television and broadband internet service provider, and the largest alternative fixed line operator in Bosnia and Herzegovina. The company is part of media company United Group.
Bosnia and Herzegovina’s Communications Regulatory Agency (CRA) published data on the country’s communications markets for 2022, which revealed that mobile subscriber numbers increased by 2 percent over the number of mobile subscribers in 2021. According to the regulator’s statistics, there were a total of 3.811 million mobile subscribers in the country at the end of 2022. BH Telecom remains the sector leader, accounting for 42.3 percent of the nation’s mobile subscribers at end of 2022, followed by the other two network operators M:Tel and HT Eronet retaining their second-placed and third-placed spots with 36.2 percent and 21.1 percent, respectively. At the end of 2022, there were six active mobile virtual network operators in Bosnia and Herzegovina.
Total fixed line connections declined by 6 percent in 2022 to 650,896 with the nation’s three “dominant” operators – BH Telecom, M:Tel, and HT Mostar – controlling the majority (80 percent) market share. The number of Internet users in 2022 was 2.5 million users, with Internet penetration at 77 percent.
According to Business Monitor International’s (BMI) Bosnia-Herzegovina Telecommunications Report, BiH’s telecom market remains one of the least developed in Central and Eastern Europe and, as such represents a significant growth opportunity for operators and telecom equipment vendors. Meanwhile, BMI believes higher value services, especially mobile data and postpaid subscriptions, will be major growth drivers as operators attempt to capitalize on the improved outlook for economic growth.
Leading Sub-Sectors
- Telecommunications equipment and services for the expansion of existing networks including mobile, fixed line, and broadband.
Opportunities
The aforementioned operators remain the best opportunity for marketing goods and services. Their near monopoly positions in mobile telephone services will continue to generate sufficient revenues to finance expansion and modernize their networks.
The rapidly growing cable television sector also provides opportunities for investment.
In accordance with EU standards, all television stations in BiH must begin digital broadcasting. Despite the deadline for transition to digital broadcasting passing in 2015, the process of digitalization is still ongoing, which should provide an opportunity for the sale of U.S. digital broadcast and ancillary equipment. Five informative-technical centers throughout the country will be linked to public broadcasting services’ digital connections and transmitters to cover the cities of Sarajevo, Banja Luka, and Mostar with digital signals. The digitization will include three public broadcasters, which will cost about $30 million after all phases of the project are complete. The tendering procedure for the digitalization project, which involves the acquisition, installation, testing, and commissioning of equipment for information and technical centers, as well as the equipment needed for digital integration of BiH with neighboring countries, was launched in August 2022 and is still ongoing.
The incumbent operators are required by law to conduct open public tendering procedures for the purchase of goods and services, though BH Telecom and HT Eronet are exempt from some provisions when procuring goods and services. Procurement notices can be found on the companies’ websites listed below. The best way to access these opportunities is via some form of local presence, either direct or through agents and distributors.