Fixed Broadband in Sweden Update – Q1 2015

Quantum-Web analysis shows that Broadband continues to grow in Sweden: 2.2% year-on-year, based on our figures for 2015 Q1.

Total fixed broadband subscribers in Sweden now stand at 3.2m.  However, the situation by technology is more complex.  Although xDSL connections still constitute the technology with the overall biggest volume of subscribers, xDSL’s volumes have been declining for the last five quarters at least.  All other broadband technologies have been rising over the same period, most notably FTTx and Cable Modem, see Fig. 1

 

Figure 1. Broadband Connections by Technology Q1 2014- Q1 2015

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Overall fixed Broadband ARPU has been falling in the last five quarters, with the decline picking up pace in recent quarters: USD 38 in 2015 Q1 vs USD 47 in 2014 Q1.  We attribute this trend to intensifying market competition which is squeezing margins and having interesting impacts on the performance of each of the main players.  TeliaSonera remains #1 fixed broadband operator and has managed to grow its subscriber base 5% y-o-y.  ComHem is on course to become #2, given its y-o-y growth of 10% and base of 628k which is only 8k behind Telenor, whose base is in gentle decline.  Tele2, however, is showing the most distress: its based has fallen 30% since last year, see Fig. 2

Figure 2. Fixed Broadband Market by Operators, Q1 2014 – Q1 2015

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All of which presents fascinating challenges for service providers, from planning and investment, across the value chain to technical deployment and marketing.  Propositions and services must be competitive enough to achieve high customer uptake in the first instance, while ongoing profitability will depend on consistently delivering a compelling customer experience that safeguards against churn.

Please contact Qmars Safikhani for further discussion around our research on fixed Broadband in Sweden.