2010 Finland - Telecoms, IP Networks, Digital Media and Forecasts

Publication Overview

This report provides a comprehensive overview of trends and developments in Finland’s telecommunications market. The report analyses the mobile, Internet, broadband, digital TV and converging media sectors. Subjects include:

  • Market and industry analyses, trends and developments;
  • Facts, figures and statistics;
  • Industry and regulatory issues;
  • Infrastructure;
  • Major players, revenues, subscribers, ARPU, MoU;
  • Internet, VoIP, IPTV;
  • Mobile voice and data markets;
  • Broadband (FttH, DSL, cable TV, wireless);
  • Convergence and digital media;
  • 3G subscriber and mobile ARPU forecasts to 2015;
  • Broadband market forecasts for selective years to 2020.

Researcher:- Henry Lancaster
Current publication date:- January 2011 (9th Edition)
Next publication date:- December 2011

Executive Summary

Finland national broadband promising world-class 100Mb/s by 2015

BuddeComm’s annual publication, Finland - Telecoms, IP Networks, Digital Media and Forecasts, provides a comprehensive overview of the trends and developments in the telecommunications and digital media markets in Finland.

Turnover in Finland’s telco sector fell in both 2007 and 2008 as the impact of the financial crisis affected consumers and telcos alike. Recovery was seen in 2009, which should continue steadily during the next few years: the key operators are committed to increasing investments in mobile and fibre networks, so allowing consumers to make greater use of IP-delivered content. More than half of total turnover is from the mobile sector, the remainder from fixed network operations, where revenue continues to fall in line with lower access and call charges, and lower use by consumers having switched to mobile-only and VoIP solutions.

Finland’s broadband penetration is far ahead of the EU average. The market is dominated by the main telcos TeliaSonera, Elisa and DNA. Wireless networks are provided nationally via MNOs and Digita Oy’s network (based on 450MHz spectrum), as well as regional WiMAX and WLAN networks.

Finland’s regulator closely monitors the country’s broadband development, comparing strategies with those of its neighbours Sweden, Denmark and Norway. This is partly to encourage regulatory and competition measures where they have proved successful elsewhere. The structure and prices of regional broadband markets also vary among the Nordic countries, with Sweden and Finland having the most favourable end-user prices regardless of connection speed.

The government’s Broadband Action Plan aims to deliver fibre-based broadband for all citizens by 2015. The Plan would deliver 100Mb/s services nationally, a significant improvement on the minimum 1Mb/s envisaged in 2004. To finance the State contribution the government auctioned frequencies in the 2.5-2.69GHz band at the end of 2009, with some of the proceeds going towards network rollout and the shortfall being met by a tax on telcos based on the number of their broadband subscriptions.

The number of fixed-line broadband subscriptions is likely to remain stagnant to 2012 as a number of consumers switch to mobile-only solutions. However, growth will steadily resume thereafter as fibre-based networks, supplemented by 100Mb/s or 200Mb/s DOCSIS3.0 offers from cablecos, are made more widely available.

The mobile sector has been equally successful, with penetration again above the EU average. Finland has one of the most advanced mobile markets in the world and has been an early adopter of emerging technologies: the country launched the world’s first commercial GSM network, it was the first in Europe to award 3G licences, and it has trailed only Norway and Sweden in launching commercial LTE services. The country has also been at the forefront in utilising sub-GHz spectrum for 3G.

There are around ten major mobile network operators or service operators in Finland, though 98% of the market (by subscribers) is controlled by a triopoly of the established players TeliaSonera, Elisa and DNA. These MNOs host several resellers and MVNOs, while Ålands Mobiltelefon operates a network in the Ålands area.

There are several mobile service operators which also provide mobile broadband services, as well as players offering mobile broadband together with fixed broadband services, but without mobile voice services. Market competition as well as regulatory measures have gradually reduced the price of mobile calls and services: indeed mobile call charges in Finland are the cheapest in Europe, while Finnish mobile broadband subscriptions are also among the least expensive.

Finland became the first country in the world to launch DTTV services based on the MHP, in 2001. The switchover from analogue to digital broadcasting was completed in 2007 – digital TV is now broadcasted in five national multiplexers with a varying coverage and channel offering. In 2009 DNA was contracted to build a network to transmit HDTV nationally, and to operate the two associated multiplexes. Signals are expected to reach 60% of the population by the end of 2011.

Key telecom parameters – 2009 – 2011

Sector

2009

2011 (e)

Broadband:

Fixed broadband subscribers (million)

1.45

1.45

Fixed broadband penetration rate

38%

45%

Mobile broadband subscribers (thousand)

410

660

Subscribers to telecoms services:

Fixed-line telephony (thousand)

908

1,850

Mobile phone (million)

7.7

8.9

Mobile SIM penetration (population)

139%

144%

(Source: BuddeComm)

Market highlights:

  • DNA has become the largest cableco following its purchase of Welho in mid-2010. The company provides up to 110Mb/s across its network, and planned to launch commercial HDTV during 2011. The operator is also an MNO, well position as a quad-play provider.
  • The regulator’s auction of spectrum in the 2.5-2.69GHz band in late 2009 cleared the way for network operators to further develop LTE technology. The long term of the licences (valid until 2029) has meant that operators have been encouraged to invest in upgrades. DNA launched HSPA+ mobile broadband with this spectrum in 2010, before migrating to LTE in 2011. TeliaSonera launched the country’s first commercial LTE service in late 2010, while Elisa has contracted a hardware provider for its anticipated launch in 2011. LTE was available in ten major cities by the end of 2010.
  • Mobile data is still dominated by SMS, though the new LTE networks will enable customers to make use of a greater range of high-end applications from 2011 onwards. Data traffic is expected to pass 55,000TB in 2012, compared to 16,000 in 2009.
  • FttH has thus far made only a small impact in Finland, and is promoted principally by housing associations and local governments. Fibre is largely a preserve of the larger cities, while in smaller centres commercial activity is being stimulated by funds made available through the government’s National Broadband Strategy. The government and regulator have targeted a national fibre or cable network enabling 100Mb/s connections across the country by 2015. The regulator estimated that by 2015 about 94% of connections would be within reach of the network. The cost of connections was estimated at between €2,000 and €3,000 per household, with some more remote areas costing up to €10,000 per household.
  • Following the end of analogue TV transmissions, freed 470-850MHz band potentially allows up to 55 channels for mobile TV. The government has licensed a fourth digital broadcasting network dedicated to mobile TV (to Digita Oy). In late 2008 DNA was the first MNO to launch mobile TV in Finland, on Digita’s DVB-H network Operators are experimenting with appropriate business models to attract consumers. Finland’s success in this market would buck the trend seen elsewhere in Europe, where mobile TV has largely failed.

This report is essential reading for those needing high level strategic information and objective analysis on the telecom sector in Finland. It provides further information on:

  • Market liberalisation and regulatory issues;
  • The impact of the global economic crisis;
  • Telecoms operators – privatisation, acquisitions, new licences;
  • Mobile data market developments in coming years in light of spectrum auctions and new license awards in 2010;
  • 3G developments, regulatory issues and technologies including HSPA and LTE;
  • Broadband migration to an FttH architecture;
  • Historical and current subscriber statistics and forecasts;
  • ARPU statistics and forecasts.

Data in this report is the latest available at the time of preparation and may not be for the current year.

Table of Contents

  • 1. Key statistics
  • 2. Telecommunications Market
    • 2.1 Overview of Finland’s telecom market
  • 3. Regulatory Environment
    • 3.1 History
    • 3.2 Revised NFR
    • 3.3 Regulatory authorities
    • 3.4 Telecom sector liberalisation in Finland
      • 3.4.1 Privatisation of Telecom Finland
      • 3.4.2 Interconnect
      • 3.4.3 Access
      • 3.4.4 Number portability (NP)
      • 3.4.5 Carrier preselection
  • 4. Fixed Network Market
    • 4.1 Overview and statistics
    • 4.2 TeliaSonera
    • 4.3 Finnet Group
    • 4.4 DNA
    • 4.5 Elisa Corporation
    • 4.6 TDC Finland
    • 4.7 Tele2
  • 5. Telecommunications Infrastructure
    • 5.1 National telecom network
    • 5.2 Next Generation Network
    • 5.3 International infrastructure
  • 6. Broadband Market
    • 6.1 Overview
      • 6.1.1 National Broadband Strategy
      • 6.1.2 Universal Service
      • 6.1.3 Broadband statistics
    • 6.2 Cable modems
      • 6.2.1 DNA
    • 6.3 Asymmetrical Digital Subscriber Line (ADSL)
      • 6.3.1 Very High-Speed Digital Subscriber Line (VDSL)
    • 6.4 Fibre-to-the-Home (FttH) networks
    • 6.5 Broadband Powerline (BPL)
    • 6.6 Mobile broadband
    • 6.7 Wireless broadband
      • 6.7.1 Wireless LANS
      • 6.7.2 WiMAX/WiFi
      • 6.7.3 Fixed Wireless Access (FWA)
  • 7. Digital Media
    • 7.1 Convergence
      • 7.1.1 Key general trends
      • 7.1.2 Business models – bundled services
    • 7.2 Digital TV
      • 7.2.1 Overview
      • 7.2.2 National licences
      • 7.2.3 Regional licences
      • 7.2.4 Digital dividend
      • 7.2.5 Broadband (IPTV)
      • 7.2.6 Cable TV
      • 7.2.7 Satellite-based digital pay-TV developments
      • 7.2.8 Free-to-Air (FTA) TV
      • 7.2.9 Digital Terrestrial TV (DTTV)
      • 7.2.10 VoIP
      • 7.2.11 Interactive TV (iTV)
  • 8. Mobile Communications
    • 8.1 Overview of Finland’s mobile market
      • 8.1.1 Mobile statistics
      • 8.1.2 Operator market shares
    • 8.2 Regulatory issues
      • 8.2.1 Spectrum regulations and spectrum auctions
      • 8.2.2 Roaming
      • 8.2.3 Mobile Number Portability (MNP)
      • 8.2.4 Mobile termination rates (MTRs)
    • 8.3 Mobile technologies
      • 8.3.1 Digital
      • 8.3.2 Third Generation (3G) mobile
    • 8.4 Major mobile operators
      • 8.4.1 TeliaSonera
      • 8.4.2 DNA
      • 8.4.3 Elisa
      • 8.4.4 Mobile Virtual Network Operators (MVNOs)
    • 8.5 Mobile voice services
      • 8.5.1 Prepaid cards
    • 8.6 Mobile Messaging
      • 8.6.1 Short Message Service (SMS)
      • 8.6.2 Multimedia Messaging Service (MMS)
    • 8.7 Mobile data services
      • 8.7.1 Overview
      • 8.7.2 General Packet Radio Service (GPRS)
      • 8.7.3 High-Speed Packet Access (HSPA)
      • 8.7.4 High-Speed Uplink Packet Access (HSUPA)
      • 8.7.5 Enhanced Data for GSM Evolution (EDGE)
      • 8.7.6 Long-term Evolution (LTE)
      • 8.7.7 Orthogonal Frequency Division Multiplex Access (OFDMA)
      • 8.7.8 Unlicensed Mobile Access (UMA)
    • 8.8 Mobile content and applications
      • 8.8.1 Location based services
      • 8.8.2 Mobile TV
  • 9. Forecasts
    • 9.1 Forecasts – Fixed-line broadband subscribers – 2009 - 2012; 2020
      • 9.1.1 Scenario 1 – higher broadband subscriber growth
      • 9.1.2 Scenario 2 – lower broadband subscriber growth
    • 9.2 Forecasts – Mobile ARPU – 2009 - 2010; 2015
    • 9.3 Forecasts – UMTS subscribers – 2009 - 2010; 2015
  • 10. Glossary of Abbreviations
  • Table 1 – Country statistics Finland – 2010
  • Table 2 – Telecom revenue and investment statistics – 2009
  • Table 3 – Telephone network statistics – June 2010
  • Table 4 – Internet user statistics – 2010
  • Table 5 – Broadband statistics – June 2010
  • Table 6 – Mobile statistics – June 2010
  • Table 7 – National telecommunications authorities
  • Table 8 – Telecom revenue by sector – 2009
  • Table 9 – Telecom revenue market share by sector – 2009
  • Table 10 – Price differential for data and voice services – 2007 - 2009
  • Table 11 – Household penetration rate of select telecom services – 2009 - 2010
  • Table 12 – Telecom revenue by sector – 2009
  • Table 13 – Telco operator assets and network investments – 2003 - 2008
  • Table 14 – Share of telecom revenue by sector (historic) – 2003 - 2007
  • Table 15 – Share of consumer telecom spend by sector – 2007 - 2010
  • Table 16 – Unbundled loops and access lines – 2006 - 2009
  • Table 17 – LLU, shared access price – connection, monthly rental (€) – 2006 - 2009
  • Table 19 – Broadband market share by sector – 2007 - 2010
  • Table 20 – Broadband subscribers – WLAN, BPL – 2004 - 2011
  • Table 21 – Broadband penetration by technology – 2004 - 2010
  • Table 22 – Broadband lines by service – 2006 - 2009
  • Table 23 – Activities of Internet users – 2005 - 2008
  • Table 24 – Forecast broadband delivery by technology – 2015
  • Table 25 – Digital TV reception by technology – 2007 - 2009
  • Table 26 – Price differential for mobile services – 2007 - 2010
  • Table 27 – Mobile operators, subscribers and annual change – September 2010
  • Table 28 – Cumulative mobile numbers ported – 2004 - 2009
  • Table 29 – Elisa mobile operating statistics and ARPU – 2007 - 2010
  • Table 30 – TeliaSonera SMS messages sent (historic) – 2002 - 2006
  • Table 31 – Forecast fixed-line broadband penetration – higher market growth scenario – 2010 - 2012; 2020
  • Table 32 – Forecast fixed-line broadband penetration – lower market growth scenario 2010 - 2012; 2020
  • Chart 1 – Telecom revenue – 2003 - 2011
  • Chart 2 – Telecom revenue by sector – 2006 - 2011
  • Chart 3 – TeliaSonera LLU accesses – 2006 - 2010
  • Chart 4 – Cumulative fixed numbers ported – 2006 - 2009
  • Chart 5 – Fixed-line operators’ market share – 2005 - 2010
  • Chart 6 – Fixed-line connections and traffic in minutes – 2006 - 2010
  • Chart 7 – TeliaSonera (Finland) mobile and broadband revenue – 2006 - 2010
  • Chart 8 – TeliaSonera (Finland) subscribers by sector – 2002 - 2010
  • Chart 9 – DNA financial data – 2008 - 2010
  • Chart 10 – DNA revenue (consumer and business) – 2008 - 2010
  • Chart 11 18 – DNA subscribers by sector – 2007 - 2010
  • Chart 12 – Elisa cable TV and broadband subscribers – 2004 - 2010
  • Chart 13 – Elisa revenue by sector – 2004 - 2010
  • Chart 14 – Elisa Group financial data – 2008 - 2010
  • Chart 15 – TDC Finland financial data – 2007 - 2010
  • Chart 16 – Fixed lines in service and teledensity – 2000 - 2011
  • Chart 17 – Broadband market share by operator – 2006 - 2010
  • Chart 18 – Broadband market share by sector – 2008 - 2010
  • Chart 19 – Proportion of broadband revenue to telecom sector – 2007 - 2011
  • Chart 20 – Internet users and penetration rate – 2000 - 2011
  • Chart 21 – Broadband penetration – 2001 - 2011
  • Chart 22 – Broadband subscribers and penetration rate – cable, DSL – 2002 - 2011
  • Chart 23 – Housing corporation broadband subscribers (regulator data) – 2006 - 2010
  • Chart 24 – DNA broadband subscribers – 2007 - 2010
  • Chart 25 – Elisa broadband subscribers – 2007 - 2010
  • Chart 26 – TeliaSonera broadband subscribers – 2002 - 2010
  • Chart 27 – TeliaSonera broadband ARPU – 2006 - 2010
  • Chart 28 – Fibre broadband subscribers – 2009 - 2011
  • Chart 29 – Mobile broadband subscribers – 2007 - 2011
  • Chart 30 – WLAN subscribers – 2004 - 2010
  • Chart 31 – Digital TV subscribers – 2003 - 2011
  • Chart 32 – Cable TV subscribers and penetration – 2000 - 2011
  • Chart 33 – Sonera Cable TV subscribers – 2008 - 2010
  • Chart 34 – Elisa cable TV subscribers – 2005 - 2010
  • Chart 35 – Satellite TV subscribers and penetration rate – 2003 - 2011
  • Chart 36 – Mobile revenue as proportion to total telecom revenue – 1998 - 2011
  • Chart 37 – Mobile subscribers and penetration rate – 1999 - 2011
  • Chart 38 – Calls and call minutes originating in mobile networks – 2006 - 2011
  • Chart 39 – Mobile operators – monthly ARPU – 2004 - 2011
  • Chart 40 – Mobile market share by operator (regulator data) – 2006 - 2010
  • Chart 41 – European roaming charges – 2007 - 2011
  • Chart 42 – Annual mobile numbers ported – 2008 - 2010
  • Chart 43 – MTRs by operator – 2006 - 2010
  • Chart 44 – TeliaSonera Finland mobile financial data – 2005 - 2010
  • Chart 45 – TeliaSonera Finland blended ARPU – 2003 - 2010
  • Chart 46 – TeliaSonera Finland mobile subscribers – 2002 - 2010
  • Chart 47 – DNA financial data – 2007 - 2010
  • Chart 48 – DNA annualised monthly ARPU – 2007 - 2010
  • Chart 49 – DNA mobile subscribers – 2007 - 2010
  • Chart 50 – Elisa mobile revenue – 2004 - 2010
  • Chart 51 – Elisa mobile subscribers in Finland and Estonia – 2004 - 2010
  • Chart 52 – SMS messages sent – 1999 - 2011
  • Chart 53 – MMS messages sent – 2003 - 2011
  • Chart 54 – Mobile data sent – 2006 - 2011
  • Chart 55 – Forecast broadband subscribers – higher market growth scenario – 2010 - 2012; 2020
  • Chart 56 – Forecast fixed-line broadband subscribers – lower market growth scenario 2010 - 2012; 2020
  • Chart 57 – Forecast mobile ARPU – 2005 - 2010; 2015
  • Chart 58 – Forecast UMTS subscribers – 2006 - 2010; 2015
  • Exhibit 1 – EU – The New Regulatory Framework (NRF)
  • Exhibit 2 – Access and the local loop
  • Exhibit 3 – Overview of media convergence
  • Exhibit 4 – 2.6GHz auction results – November 2009
  • Exhibit 5 – Sample 3G infrastructure suppliers in Finland
  • Exhibit 6 – Premium SMS market overview – 2005

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