Switzerland Telecom Market Trends

Market Trends of Switzerland Telecom Industry

Rising Demand for 5G is Expected to Drive the Market

• Switzerland is witnessing a surge in 5G initiatives, ranging from spectrum auctions to business trials, all to nurture 5G applications tailored to local needs. These initiatives are integral to a larger strategy to cultivate a dynamic 5G ecosystem that fuels innovation and economic expansion. Collaboratively, the government and private enterprises are striving to maintain Switzerland's position as a leading adopter of 5G technology and its diverse applications within the EU. With numerous firms making consistent investments in 5G, the technology is poised to play a pivotal role in propelling the Swiss economy forward.
• The Federal Office for the Environment reports that mobile network data transmission has doubled annually. The introduction of 5G in 2019 aimed to enhance data transmission capacity with ongoing network construction in Switzerland. Asut, the Swiss Telecommunications Association, states that Switzerland is at the forefront of global 5G deployment. Various initiatives and investments are being made in the local 5G sector to promote its uptake.
• The Federal Office of Communications in Switzerland has reported that there are 6,000 operational 5G antennas in the country. During the initial stages of the 5G network deployment, these antennas were swiftly established by converting existing ones through a simple software update. At present, 5G services are exclusively provided by the three major providers in Switzerland, namely Swisscom, Sunrise, and Salt. Additionally, Yallo offers 5G as an optional feature for its subscriptions. The ongoing advancements made by these companies are anticipated to drive the widespread adoption of 5G technology in the region.
• Moreover, by the end of 2023, Swisscom, as reported by ComCom, achieved 99% 5G coverage, delivering speeds of up to 1 Gbps. Notably, 81% of the population already had access to 5G+ speeds, reaching up to 2 Gbps. Looking ahead, Swisscom is targeting a 90% coverage for 5G+ by 2025. In contrast, in early 2023, Salt unveiled its capability to reach 99.9% of the population, offering internet speeds of up to 750 Mbps by harnessing a blend of 3G, 4G, and 5G signals. These strategic moves by local players are poised to significantly propel 5G adoption rates across Switzerland.
• Swisscom initiated its 5G network rollout back in 2018, achieving an impressive 96% coverage of the Swiss populace. Notably, Swisscom has introduced a variant called "5G+," harnessing adaptive antennas tailored for this technology. In January 2024, the Swiss telecoms regulator, the Federal Office of Communications (Ofcom), unveiled plans to open up the 3,400 MHz to 3,500 MHz spectrum for private 5G mobile networks. These proactive steps by Swisscom and regulatory bodies are poised to catalyze the market's growth trajectory.

Data and Messaging Services to Hold a Significant Market Share

• In Switzerland, the data and messaging services sector, facilitated by fixed and mobile networks, leverages channels like the internet and text messages. This sector is on an upward trajectory, propelled by the rollout of 5G services and the widespread availability of fiber-based fixed internet connections. To keep pace with the surging demand, telecom providers are forging partnerships, enhancing their network infrastructure, and rolling out 5G services nationwide.
• The Statistical Observatory of OFCOM provides data on mobile telephony prices in Switzerland, focusing on the lowest rates providers offer. These statistics highlight significant variations in prices across different service packages. Irrespective of the specific service bundle, the least expensive option can be more than two to three times cheaper than the most costly one. In 2023, M-Budget offered the most affordable plan for light phone users (including 30 telephone calls and 500 MB) at CHF 12 per month (USD 13.29). This price was approximately half of the highest-priced monthly offer, which Swisscom provided at CHF 23 (USD 25.46).
• Mobile phone plans in Switzerland vary significantly in price depending on the usage requirements of the consumer. For those who fall into the medium-usage category, M-Budget's offer at CHF 14 (USD 15.50) is a much more affordable option compared to Swisscom's offer at CHF 39.90 (USD 44.18) . On the other hand, customers with high usage needs will find Yallo's offer of CHF 19.50 (USD 21.59) a better deal than Swisscom's offer of CHF 50.60 (USD 56.02). Despite these differences, it is essential to note that mobile telephony prices in Switzerland remain some of the highest globally for those in the medium-usage category.
• Numerous enterprises are making substantial investments in diverse technologies, including 5G. As the utilization of 5G services continues to grow, it is anticipated that there will be notable advancements in data services. According to their statement, Swisscom is actively expanding its 5G network to guarantee superior network quality and consistently provide customers with an exceptional mobile network. By the conclusion of March 2024, Swisscom had already extended 5G+ coverage to over 82% of the Swiss population. Additionally, the company has managed to refrain from passing on additional expenses, such as the VAT increase, to their valued customers.
• The increasing utilization of internet-based services across different industries, such as BFSIs, governments, retail, manufacturing, healthcare, and more, is fueling the requirement for data services from telecom service providers in the country. This encompasses internet data packages for prepaid and postpaid data services, as a larger number of individuals are adopting digital services. Additionally, market vendors in the area are broadening their range of data services to meet the escalating market demand.