The Swedish Telecommunications Market 2005 - PTS-ER-2006:23
08/06/2006
Viewed overall, the retail market for electronic communications in Sweden had a turnover of SEK 49.2bn during 2005, which means that the retail market reduced in total by 1.2 per cent when compared with 2004.
On 31 December 2005 there were 5 624 000 fixed telephone subscriptions in Sweden, of which 5 236 000 were PSTN subscriptions. At that time just over 19 per cent of the total number of telephone subscriptions were provided by an operator other than Telia Sonera, which is an increase of 17 per cent since 31 December 2004. This increase is mainly due to the introduction of the resale product wholesale product for telephone subscriptions (GTA), which has made it possible for more operators to invoice the subscription charge. Sales were substantial during 2005, and the number of subscription customers amounted to 854 000 in December 2005. The remaining increase is found within IP-based telephony. There were 210 000 subscriptions for IP-based telephony on 31 December 2005, which corresponds to an increase of 159 per cent since 31 December 2004, when the number was 80 800. The vast majority, that is 203 000, were household customers. On 31 December 2005 there were 4 245 000 household customers of fixed telephony, of which 42 per cent have chosen to place calls with an alternative operator to Telia Sonera.
The market value of fixed call services amounted during 2005 to SEK 21.9bn, which is 2.1 billion less than during the same period 2004. The market for fixed call services demonstrates in other words a negative growth of 9 per cent.
PTS has, as of the reports for 2005, changed the definition for how long a prepaid card may be inactive to be included in the statistical information-base. This change entails an adjustment in the number of mobile subscriptions. With the new three-month definition, the number of mobile subscriptions was 9 086 919 on 31 December 2005, which corresponds to approximately 10 per cent less mobile subscriptions than when applying the previous definition.
The annual growth in mobile subscriptions has been at a relatively stable level of around ten per cent for several years. Between 2004 and 2005 the number of mobile subscriptions (contract subscriptions and pre-paid cards) increased only just over three per cent, which is less than previously.
The service providers of mobile call services are still small, with an aggregate market share of somewhat more than 2 per cent of the total number of subscriptions, which corresponds in number to 199 000.
The number of traffic minutes in the mobile networks increased greatly, by 31 per cent, during 2005. During 2004 growth in traffic was 13 per cent. The fact that the traffic in the networks is increasing so greatly despite marginal change in the proportion of Swedes using mobile telephones clearly demonstrates that we are increasing our use of mobile telephones. It is primarily private customers who call more. One important reason for the rather great increase occurring now is almost certainly due to it having become increasingly less expensive to call with mobile telephones during 2004 and 2005. The proportion of mobile voice traffic of the total voice traffic (i.e. the total voice traffic in fixed and mobile networks) was 23.4 per cent during this period, an increase from just over 18 per cent during the corresponding period a year ago.
Turnover for mobile call services increased by 2.2 per cent from SEK 16.2bn to SEK 16.6bn between 2004 and 2005.
PTS estimates that the value of the market for data communications services to end-user amounts to SEK 4.22bn. This means that the value of the market has reduced by 3 per cent compared with 2004, when the turnover was SEK 4.37bn, and compared with 2002 the turnover has reduced by 13 per cent. The reason for the value of the market decreasing is that there is a rapid shift in progress from traditional data communications services, such as Frame Relay and leased lines, to primarily IP-VPN.
Growth in the total number of customers with Internet access has remained static after a couple of years of stagnation. The number of customers increased by only 12 100, from 3 290 900 to 3 303 000 between 31 December 2004 and 31 December 2005. The trend towards a growing proportion of fixed connections is continuing and in 2005 fixed access is for the first time greater than dial-up access. The number of fixed-access customers was 1 884 100, or 57 per cent, and the number of dial-up access (PSTN and ISDN) customers was 1 417 900, or 43 per cent on 31 December 2005. On 31 December 2005, 1 727 400 household customers with Internet access were connected via some form of fixed connection. The corresponding number of customers was 1 230 500 on 31 December 2004. The relationship between the number of household customers connected to the Internet via some form of fixed connection and the number of households in Sweden was 39 per cent on 31 December 2005. Compared with the previous year, this proportion has increased by 11 per cent from 28 per cent. Of the total number of connections in the private market, 59 per cent are fixed connections.
ADSL is the access form that has the greatest number of household customers in the market for fixed connections and now represents 37 per cent of the total market for Internet accesses to households. This is a proportion that has increased greatly. LAN networks have 10 per cent and cable television networks 12 per cent of the total household market. Between 31 December 2004 and 31 December 2005 the number of household customers with ADSL increased by 45 per cent, from 749 000 to 1 083 000.
The economic importance of Internet access as a service in the Swedish telecommunications market continued to increase during 2005. In total, turnover in the market for Internet access amounted to SEK 7.45bn, which is 12 per cent more than during 2004, when the turnover was SEK 6.68bn. It is primarily the subscriptions to fixed connections that are providing the operators with increasing revenues. These revenues rose by 26 per cent in value during 2005. The revenues from fixed connection, which amounted to SEK 6.33bn, currently comprise 85 per cent of the total revenues for Internet access. The revenues for dial-up Internet amounted to SEK 1.12bn during 2005 and are continuously reducing.