Bredband2: SE fibre market: 11% growth 2021 (vs. 18% ’20) - ABG

PTS has published new statistics for the SE fibre market
Bre2’s market share increased to 12% (8% ’20) due to A3
Bredband2 is now prioritising growth

Bredband2 is currently the number 3 fibre actor in Sweden
Earlier this week, PTS published its annual statistics for the Swedish fibre market. In terms of subscribers, we note that Bredband2 held 11.7% of the private fibre market in 2021, up from 7.8% in 2020 (albeit down from 12.3% in ’20 on proforma basis). Needless to say, the main reason for this is the merger with A3 where Bredband2 has migrated all customers into one unified brand, leading to raised churn. Other notable movements are that Telia gained 0.8pp market share while Telenor lost 0.9pp market share. In terms of market value, Telia retained its number one position with 36% market share (36% in ’20), followed up by Telenor at 19% (20%), Bahnhof at 10% (11%), and Bredband2 at 10% (6%).

The Swedish private fibre market is starting to mature
After some years with very strong market growth, the private fibre market saw decelerating growth rates in 2021, growing 11% y-o-y (vs. 18% in 2020), reaching a total market value of SEK 8.9bn. We note that fibre now accounts for 79% of all private broadband connections, up from 75% in 2020 and 51% in 2015. Although the market is starting to mature, these data still imply some further market potential for the fibre players.

Bredband2’s focus ahead is growth
After having focused on reaping cost synergies during 2021, Bredband2 is now prioritising growth (both organic and inorganic). In our view, this should pave the way for the company to win back some lost market share (on a proforma basis). However, unlike in recent years where a significant share of the growth in its number of subscribers has stemmed from greenfield fibre customers, a maturing market implies that a higher share must come from competitors. Here, the company benefits from its low prices. Furthermore, while we note that some of its competitors are currently ...
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