2011 Sweden - Telecoms, IP Networks, Digital Media and Forecasts

LTE availability expected for 99% of the population by end-2012

BuddeComm’s biennial publication, Sweden - Telecoms, IP Networks, Digital Media and Forecasts, provides a comprehensive overview of the trends and developments in the telecommunications and digital media markets in Sweden. It provides an analysis on the latest market developments, including the regulator’s H1 2011 market report, operator data to the end of 2011 and updates into 2012.

Sweden has fared better than most countries in weathering the ongoing economic downturn. GDP fell 5.3% in 2009 in the wake of the 2008 crisis, but recovered quickly, growing at some 5.5% in 2010 and by an estimated 3.8% in 2011. This performance has been mirrored in the country’s telecoms market: although telecoms revenue was stagnant for a number of years, and fell in 2008, sine then it has increased steadily and is expected to reach some SEK54.2 billion for 2012. The market has continued the trend for consumer migration to mobile voice and data services at the expense of fixed-line telephony. More calls are now made via mobile networks than the fixed network, while there are almost as many mobile broadband subscriptions as there are via the copper network.

Sweden was the first country in Europe to develop a broadband policy, as early as 1999. The country now has one of the highest broadband penetration rates in the region, and maintains one of the world’s most connected economies. Near-comprehensive DSL coverage is complemented by excellent urban cable infrastructure and significant fibre networks which attract high-end broadband subscribers. Open access networks in a number of municipalities enable providers to offer services far cheaper than if they had built their own networks. By 2013 about 90% of homes and business will be covered by FttH. Numerous networks open to a range of content and service providers have been built by organisations other than telcos, including municipalities, regional governments, housing associations and local utilities. Municipal and local area networks have quadrupled in reach since 1999.

Mobile phone penetration remains among the highest in the EU, while 4G services have been launched by operators. TeliaSonera launched the world’s first commercial LTE network at the end of 2009, and in early 2012 the company, together with Tele2, were the first to offer LTE smartphones. Despite market saturation subscriber growth remains steady, particularly in the 3G/4G sector. This has been mirrored by greater consumer take-up of mobile data services made possible by significant network investment. In addition, consumers are increasingly moving to mobile telephony for calls: mobile networks now carry the majority of traffic. By the end of 2012, 4G should be available to 99% of the population.

Sweden also has one of the most developed digital TV markets in the Nordic region. The government awarded multiplex licences as early as 1998. Multiplex ownership is separated from content broadcast over them: Teracom built, owns and operates the digital TV multiplex. When the DTTV network was launched in early 1999, Sweden was only the second country in Europe to have the system. The five-stage phased analogue switch-over process was completed by late 2007, ahead of schedule.

Key telecom parameters – 2010; 2012

(Source: BuddeComm)

Market Highlights

• The number of triple play subscriptions reached about 635,000 by the end of 2011, while the quad play subscriber base looks set to grow rapidly during the next few years as consumers take advantage of cheaper offers from operators able to exploit their upgraded networks. The range of offers is unlikely to widen, given that the most popular combination is broadband with fixed telephony, which represents over half of all bundled subscriptions. In triple play, fixed telephony with fixed broadband and TV represent most bundles.
• The award of 15-year national licences in the 800MHz band has enabled MNOs to extend their rural broadband capabilities, utilising LTE technology. This will go far in meeting the government’s Broadband Strategy objectives. Sweden is also among the leading EU countries to use 900MHz spectrum for 3G services.
• Mobile data use has grown considerably since 2007, and is set to grow more rapidly during the next few years as LTE and HSPA networks expand across the country Mobile data use is expected to increase by about 70% in 2012, though this will not be mirrored by a similar increase in mobile data revenue for operators given existing competition and regulatory measures on data tariffs.
• Continuing constraints on mobile networks, despite the greater availability of spectrum, may encourage MNOs to introduce business models adjusting to customer demand, with pricing tiered based on speed and usage. 

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

• Market liberalisation and regulatory issues;
• he 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;
• 4G 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.