Broadband exemption risks increasing uncertainty and reducing investment 

To achieve this, the interaction between the private and public sectors needs to work optimally.but unfortunately this is rarely the case. It is a well-known fact that many Swedish companies experience problems when they face competition from public actors selling goods and services on the open market. In addition, the role of municipalities in the broadband market remains unclear. A new government proposal to allow municipal housing companies to sell services to citizens outside the municipal boundaries hardly makes things better.

Most people agree that municipal urban networks can be important for the expansion of fiber and the leasing of "dark fiber" within the municipality's boundaries. But the idea that municipal companies can sell broadband to consumers - even in another municipality - seems more far-fetched. Exactly where the boundaries of the municipalities' role in the broadband market lie is not entirely clear, so it is also not clear at what level in the value chain municipalities and municipal companies may act. In other words, the limits of municipal competence are unclear.

Despite this, an investigation by the Government Offices of Sweden now proposes that municipal city networks should also be able to build out broadband networks in neighboring municipalities. In theory, this proposal only refers to the rollout of dark fiber infrastructure. But it is unlikely that this would be the result in practice. I Instead, there is an obvious risk that municipal companies will want to become full-scale players that expand their operations at several levels of the value chain - that is, even beyond the geographical boundaries of their own municipality.

The proposed exemption thus risks creating further ambiguity in the market, giving rise to conflict and uncertainty, which in turn hampers the ability of both public and private actors to invest.

I do not think that even our government imagines that an exemption from the localization principle would be the main way to facilitate the expansion of fast broadband. On the other hand, it may have other advantages, but then the question of the role of municipalities in the market needs to be clarified. It is also important to ensure that the negative effects of the proposal on the functioning of the market do not outweigh the positive effects the proposal may have.

I write about this in TechSverige's consultation response, which you can read here: