Swedish 3G operators face billion kronor fines

Telia and Sweden's other 3G operators are threatened with billion-kronor fines if they do not get a move on with building up their 3G networks.

The threat comes from the National Post and Telecom Agency (PTS) which at the same time lessened its demands concerning signal strength, saving the companies 1.5 billion kronor.

Telia, Vodafone, 3 and Tele 2 have not built up their 3G networks in accordance with the commitments they made when they were awarded the licences. The networks should have been ready two years ago but are still only part-finished.

But now, PTS has finally said enough is enough. If the companies do not make some rapid progress they will be ordered to pay fines of billions of kronor.

The 3G network currently reaches around 85% of the Swedish population. But in order to reach the target of giving 8,860,000 Swedes access to 3G, another 8,000 transmitter stations must be built – at a cost of around a million kronor each.

“The fines will be set so high that it will pay to finish building the network,” said Marianne Treschow, the Director General at PTS.

PTS has also given a straight no to an application from 3 and Vodafone to be able to renegotiate the 3G licences and use an alternative, cheaper technology to build the network with the Norwegian company, Nordisk mobiltelefoni.

The reason given by PTS was that the different technologies are not entirely compatible. The decision satisfied Telia, of not 3 and Vodafone.

“It’s a sensible decision,” said Marie Ehrling, managing director of Telia Sonera Sverige to Näringsliv 24.

“It’s too late to change the conditions. To combine technologies would not have been a good solution.”

IT minister Ulrica Messing also welcomed the decision.

“I hope that this means that the rules of the game are now fixed so that the continued development of the 3G network can speed up,” she said.

But PTS also gave the operators an early Christmas present in the form of reducing the signal strength requirements. The decision will save the companies around 1.5 billion kronor and, according to PTS, will reduce the number of masts by 25% – around 850 masts per network.

It is mobile phone users in the sparsely populated north of Sweden who will suffer, however, and they were quick to express their annoyance.

“We should have the same 3G network coverage as in the rest of the country, not worse,” said Bert-Rune Dahlberg, the leader of Åsele council, some 150km from Umeå.

“How can they justify having it any other way?”

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