Communications in Sweden

This article covers telecommunications in Sweden.

Sweden liberalized its telecommunications industry starting in 1980s and being formally liberalized in 1993. This was three years ahead of USA and five years before the European common policy introduced in January 1998 allowed for an open and competitive telecommunication market. The Swedes, most of who are computer literate, enjoy a continuous growth in the Internet market and the availability of technologies such as Metro Ethernet, fiber, satellite, WAN access technologies and even the availability of 3G services. Statistically, 6.447 (2004) million telephone main lines are in use, 8.0436 (2005) million mobile cellular telephones are in use and 6.7 million Swedes are regular internet users.

This abundance of telecommunication technology is a result of promoting a competitive industry that was made possible by deregulation. Since Sweden was the first to take on this arduous task the government had to come up with “a regulatory framework of its own”. The processes that went about resulting in the liberalization of the telecommunications’ industry can be structured into three phases: “Phase 1 of monopoly to Phase 2 with a mix of monopoly and competition to a “mature” Phase 3 with extensive competition”.

During the period of 1993-2000 there is rise in competition with legislation of the regulatory body being changed several times. In the case of the POTS, Telia in 2000 still held monopoly in the fixed-line access market. Whereas, mobile phone and Internet penetration in the household market ended up being one of the highest in the world with more than 50 percent of the revenue coming from these two industries. There were three major organizations providing GSM services and 120 internet service providers. One of the major causes that lead competitions thrive in areas that did not have a history of monopoly was the light handed approach taken towards the interconnection issue by the regulatory body initially. Telia held very high interconnection charges, making it very difficult for new entrants to enter. But what it did do was push the new entrants to enter other markets. Tele2 did just that by taking out a massive marketing campaign to attract a huge number of customers to its internet access service. This campaign was successful enough to bring back Telia to the negotiation table over the interconnection issue . This process eventually lead to the abolition of the light handed regulatory approach towards interconnection and put more power in the hands of the regulatory body. The intensity of regulation kept increasing around 1999 in areas other than POTS, especially the mobile market.

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