Broadband prices in the Nordic countries in 2006 - PTS-ER-2007:1
22/01/2007
The four Nordic broadband markets – in Denmark, Finland, Norway and Sweden – have all shown similar developments in recent years: increased use of the Internet, there is a clear transition from modem to broadband access and there is an ongoing consolidation process through corporate acquisitions. At the same time, the countries' political objectives all state that the entire population of each country should have access to the digital information society and that no one should be excluded. This means that from a consumer perspective, the accessibility to and use of infrastructure is of particular importance. Consequently, Nordic governments are very interested in monitoring the situation.
Among the various forms of broadband access, xDSL is the most widespread one and which is showing the strongest growth in all countries. The second most common form is broadband access through cable television networks. With the upgrade of cable television networks and the rollout of fibre LAN, certain residential and non-residential customers have received several alternative connection possibilities to the Internet besides the copper access network. However, many people do not have the freedom of choice between different infrastructures, and for some, there is no possibility of obtaining access to broadband at all. Copper access networks are undergoing continual upgrades in the Nordic countries with an increased focus on end users in less densely populated areas also being offered broadband through the copper network. WiMAX, an example of wireless broadband, is growing in the Nordic countries and can serve as a complement to network-bound technology.
Many customers regardless of Nordic country pay a connection charge, that is, an installation charge, in conjunction with their becoming broadband customers. The charge regardless of speed can be as high as EUR 129. Most customers can nevertheless expect to be offered free installation.
The price of a broadband subscription varies considerably between the Nordic countries. For example, the price of a broadband subscription at 8 Mbps varies between EUR 31 and EUR 107. For Nordic consumers, the price of a broadband subscription at 2 Mbps is a monthly charge of between EUR 22 and EUR 75. Sweden generally has the lowest prices and Denmark the highest. Denmark also has the largest interval between the highest and lowest price for the same speed, whereas Norway has the smallest interval. Sweden has smaller price differences between various speeds compared to the other countries. Finland has greater differences in prices than Sweden, but smaller differences than compared with Norway and Denmark.
Operators have two main ways of gaining access to the copper access network in order to offer broadband to their customers, through either LLU (local loop unbundling) or through bitstream access. In the past year, the price per month for leasing LLU access has dropped to a varying extent in all of the Nordic countries. The price is the lowest in Denmark and the highest in Norway, with a difference corresponding to EUR 4.4 per month.
There are a number of competition problems in the market, and which the regulatory authorities are trying to reduce or eliminate in various ways. Examples of such barriers include limited access to infrastructure, long lead times, discriminatory information and changed assumptions in conjunction with the rollout and conversion of access networks.