Telecom operators in Poland invest an average of PLN 3 billion annually in the development of fibre-optic networks, base stations, backbone infrastructure and communications security. As a result, consumers have access to high-speed internet, and telecom services in Poland remain among the cheapest in Europe. These are the main conclusions of the report “The Telecommunications Market in Poland”, prepared by Arthur D. Little for the Lewiatan Confederation. Experts stress, however, that despite these substantial investments, the Polish market still requires deregulation, a more level playing field vis-à-vis global technology giants, and a long-term strategic vision.
Capital expenditure by network operators in the Polish telecommunications market amounts to an average of PLN 3 billion per year. In 2024 alone, the industry invested a total of PLN 9.5 billion. The four main operators — Orange, Play, Polkomtel/Plus and T-Mobile — invested a combined PLN 94.4 billion between 2014 and 2024.
“Today, Poland has a very strong starting point. It is based on high service quality combined with low prices for end users,” Mateusz Kowalczyk, Director of Strategic Consulting at Arthur D. Little, said in an interview with the Newseria news agency.
According to the report, LTE coverage in Poland reaches 99% of the population, while 5G is available to 89% of households. At the same time, the share of household spending devoted to telecommunications services remains below the European average. In 2023, it stood at 1.8%, compared with 2.2% across the European Union. By comparison, households in the Czech Republic spend 2.4% of their budgets on telecom services, Romania 2.7%, and Bulgaria 3.1%.
“When comparing the condition of Poland’s telecom sector with that of other European countries, we can look at it from two perspectives. The first is service quality. Compared with our neighbours, Poland performs very well in terms of 4G and 5G network coverage, data transmission speeds and fibre-optic network development. In all these areas, Poland is either among the countries performing well above average or comparable with large economies whose telecom sectors are much bigger and wealthier,” the Arthur D. Little representative explained.
At the same time, the report’s analysts note that Poland has for years ranked near the bottom in terms of ARPU, or average revenue per user. In 2024, ARPU for internet services in Poland stood at EUR 17.3, compared with EUR 23.1 in Germany, EUR 23.9 in France, and EUR 25.6 in Italy. This low level constrains operators’ revenues and their ability to reinvest.
“Poland performs worse in terms of the sector’s profitability and its growth dynamics. This is important because sector profitability and the margins it generates translate directly into investment capacity,” Kowalczyk stressed.
The average EBITDAaL margin of Polish operators is around 27%, compared with an EU average of 32%. In France, it reaches 38%, and in Germany 41%. Lower profitability creates challenges in financing both the maintenance and further development of infrastructure, as well as ensuring its resilience to potential threats.
“If we want to remain competitive in the future, and if we want our digital economy to continue developing — and Europe itself to remain globally competitive — it is crucial to ensure that this sector remains attractive. This applies both to capital investors, who can provide an additional growth impulse, and to operators in Poland, who are less profitable than those in countries such as France or Germany and therefore need a greater ability to accumulate capital for further investments,” the Arthur D. Little representative said.
He emphasized that the Polish telecom sector faces a number of challenges linked to overregulation, competition from big tech companies, and rising expenditure on defence and infrastructure resilience.
“All this requires a response. First of all, we need to loosen the regulatory corset. Appropriate conditions and incentives for infrastructure investment must be created, and the entire fiscal and regulatory framework should be oriented not toward maximising short-term budget revenues, but toward ensuring the long-term development of telecom infrastructure. It is the foundation of the digital economy and of our state’s resilience,” Kowalczyk said.
According to the report, the digital economy accounts for around 10.5% of Poland’s GDP, while the telecom sector itself contributes 1.3%. In 2024, the total value of the Polish telecommunications market amounted to EUR 10.3 billion. However, it was already at a similar level a decade earlier, growing only slightly over the long term, at an average rate of just over 1% annually since 2014.
“A very good example of how the regulatory framework can directly constrain development is the recent National Recovery Plan (KPO) and FERC programmes, which allocated substantial funding for fibre-optic network expansion. However, the structure of these programmes, their rigidity and lack of flexibility meant that many operators simply had to withdraw at a certain point. They were unable to meet the requirements, and the economics of these projects were weak,” the Arthur D. Little representative argued.
In light of the report, the Polish telecom sector plays an important role in strengthening the EU’s social and territorial cohesion, investing in networks in rural and less densely populated areas. In doing so, operators help fulfil the goals of the Digital Decade programme, including gigabit access for every household and universal 5G coverage.
Under FERC and the KPO, around PLN 7.1 billion was earmarked for infrastructure reaching 1.7 million households. However, a substantial share of this budget did not translate into actual investment commitments by operators. The reasons included legislative uncertainty, tight implementation schedules, and weak project economics in rural and peripheral areas.
“As part of the report, we presented a number of recommendations. The key ones are, first, harmonising the regulatory environment and making it more supportive of investment, reducing the associated administrative procedures, and streamlining regulatory and reporting obligations imposed on operators so that less effort goes into compliance and more into planning future investments,” Kowalczyk explained.
The report’s authors highlight that the average European telecom operator must navigate 34 separate regulatory domains along the so-called customer journey. These obligations arise from nine sector-specific laws and 19 general legal acts, many of which overlap or duplicate one another. The Polish market is further burdened by an even greater level of regulatory detail in some areas. One such example is the requirement to obtain consent for adding internet service charges to a bill.
“The second recommendation is to ensure an equivalent competitive environment. Put simply, if we have products that are substitutes for one another — such as internet messaging services replacing SMS — then they should operate under the same regulatory conditions. They should be subject to similar burdens, and there should be no regulatory asymmetry, because removing that asymmetry would only improve competitiveness,” the Arthur D. Little representative argued.
The report also points to a major imbalance between big tech companies and telecom operators in terms of market capitalisation. The five largest US technology companies increased their market value by more than 350% between 2015 and 2023, making it easier for them to expand and grow in Europe. Over the same period, the market capitalisation of the European telecom sector fell by around 15%.
“The third key area is the development of a long-term plan and strategy for the sector, so that the state starts thinking now about how to become more independent or diversify its supplier base, for example in the cloud sector. It should also consider how to support investment in critical areas such as backup power systems, and how to create an environment that encourages competitiveness, a greater role for European companies, and the development of infrastructure networks resilient to today’s challenges,” Kowalczyk concluded.
