Finns Bump Customers Off Fixed Net

Telia Company plans to migrate 53,000 rural customers in Finland to mobile and wireless broadband networks because it's just too expensive to serve customers in sparsely populated areas with its fixed-line network. (See TeliaSonera Migrates Users.)

Within a year, the Finnish incumbent says it will deliver voice services to customers in rural areas only via its GSM network. And by the end of 2009, it plans to deliver all broadband services to the countryside via wireless broadband technologies -- but not WiMax.

Instead, TeliaSonera favors, at least initially, a wireless broadband network based on Flash-OFDM (Orthogonal Frequency Division Multiplexing) technology that runs at 450 MHz.

"We haven't been looking at WiMax," says Eila Rummukainen, director of broadband services at TeliaSonera in Finland. "It's different in Finland because of the 450MHz network."

But TeliaSonera isn't building out the Flash-OFDM capabilities itself. In Finland, a national license at 450 MHz was awarded to TV and radio network operator Digita Oy for the purpose of bringing broadband services to rural areas by the end of 2009, according to Kari Heiska, chief specialist at Digita.

The operator has deployed a Flash-OFDM network with equipment from Nokia Networks . Flash-OFDM is considered to be more bandwidth efficient than today's cellular networks. It uses a modulation scheme that can support an average data rate of around 1.5 Mbit/s while only using 1.25 MHz of spectrum. (See Flarion, Siemens Suck Up to Finland.)

Digita is only the network operator and does not deliver services to end users. Service providers such as TeliaSonera buy network access from Digita to provide broadband services to rural customers.

TeliaSonera plans to offer a 1-Mbit/s service for €44.90 (US$66) per month.

"We have 53,000 customers and 1 million [telephone line] poles that are 35 years old," says Rummukainen. "It's too expensive to have this kind of fixed network in those... rural areas. Also, from the changing climate... we have three times more storms nowadays than 20 years ago. So, it's very dangerous for these poles, and the mobile network is more reliable."

Ultimately, the Finnish operator wants to serve rural customers with broadband via 3G services over 900 MHz. But Rummukainen says this could take two to three years, mostly because of the lack of handsets that support WCDMA at 900 MHz (the regular WCDMA spectrum is 2.1 GHz). (See Down on the (Re)Farm and Elisa Launches 900MHz 3G.)

"It's not useful to build a network if people don't have phones," says Rummukainen. "That's the main problem at the moment."

Finland is the only European country that allows so-called spectrum refarming, which involves the deployment of 3G services at 900 MHz, the spectrum used for GSM services. And the country may continue to stand out in the crowd given the regulatory hurdles the concept faces. (See Telefónica Trials 900MHz UMTS, France's 3G Giveaway, and 3 Group Seeks Spectrum Compensation.)

— Michelle Donegan, European Editor, Unstrung

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