Swiss operator remains in talks with the regulator about the blocked expansion of its fiber-optic network.

Anne Morris, Contributing Editor, Light Reading

February 3, 2022

4 Min Read
Swisscom appoints new CEO amid fiber concerns

Urs Schaeppi seems pretty happy with Swisscom’s performance over the past 12 months. The CEO hailed the Swiss operator's "strong financial result in 2021," when it recorded growth in revenue and operating income despite the difficulties related to the pandemic.

"We inspired customers with our products, service and infrastructure in a persistently challenging environment," Schaeppi claimed.

This will also be the last time that Schaeppi presides over Swisscom's earnings presentation. After nine years at the helm, he has decided it is time to step down as CEO.

Figure 1: Obstacle course: The Swiss operator remains in talks with the regulator about the blocked expansion of its fiber-optic network. (Source: Unsplash) Obstacle course: The Swiss operator remains in talks with the regulator about the blocked expansion of its fiber-optic network.
(Source: Unsplash)

Swisscom announced that Christoph Aeschlimann, currently head of infrastructure, network and IT, and a member of Swisscom's group executive board since 2019, will take over the top job when Schaeppi leaves on June 1, 2022.

Before he bids farewell to a company that has been his home for 23 years, Schaeppi will be hoping to resolve a major problem that has plagued Swisscom in recent months.

In June last year, Schaeppi warned that government objections could delay fiber rollout for years, because the Swiss Competition Commission (ComCo) and the Federal Administrative Court (FAC) took issue with Swisscom's planned range of wholesale offers.

Indeed, the matter remains very much in the air. Schaeppi indicated that Swisscom is still "in dialogue" with ComCo over the issue, noting that the situation regarding the expansion of the fiber-optic network "remains difficult."

"Clarity is needed urgently in the ongoing proceedings with the Competition Commission. The Swiss economy and society are dependent on a future-oriented fiber-optic expansion to drive digitisation forward," he said.

Meanwhile, Swisscom had connected 4.8 million or some 90% of homes and businesses to its 80Mbit/s network by the end of 2021. Over 3.9 million or 72% of homes and businesses also now have access to 200Mbit/s services owing to "a combination of fibre-optic technologies," the operator said.

The focus is now on the deployment of fiber-to-the-home (FTTH). Swisscom had aimed to double FTTH coverage to around 60% in Switzerland by 2025, but said the intervention by the authorities would make such a feat significantly more expensive and would reduce the planned coverage to 50%.

"The original expansion target of creating around 1.5 million fibre-optic connections by 2025 would thus be reduced by a third, or around 500,000 homes and offices," the operator said.

In terms of 5G, Swisscom said it currently covers 99% of the Swiss population with a basic version of 5G.

Italy still outshines Switzerland

In 2021, group revenue increased by 0.7% year-on-year to CHF 11.2 billion (US$12.1 billion), once again primarily owing to growth at Italian unit Fastweb. Group EBITDA increased by 2.2% to CHF 4.45 billion ($4.82 billion).

In Switzerland, revenue fell slightly by 0.2% to CHF 8.2 billion ($8.89 billion). The group blamed competition and price pressure for a 3.3% decline in telecoms services revenue.

Fastweb reported year-on-year revenue growth of 3.8% to €2.4 billion ($2.7 billion), meanwhile, as well as a 5.4% rise in EBITDA to €826 million ($932.6 million).

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For the 2022 financial year, Swisscom is forecasting net revenue of CHF 11.1 billion-CHF 11.2 billion ($12 billion-$12.2 billion), EBITDA of around CHF 4.4 billion ($4.77 billion) and capital expenditure of around CHF 2.3 billion ($2.5 billion). Swisscom is proposing an unchanged dividend of CHF 22 ($23.86) per share for both 2021 and 2022.

The operator also warned that tough competition and high pressure on prices persist in Switzerland and reiterated its intention to reduce its cost base by some CHF 100 million ($108 million) in 2022, as in previous years.

Although this will involve job cuts in some areas, Swisscom said new jobs will be created in growth areas such as the IT solutions business.

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— Anne Morris, contributing editor, special to Light Reading

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About the Author(s)

Anne Morris

Contributing Editor, Light Reading

Anne Morris is a freelance journalist, editor and translator. She has been working in the telecommunications sector since 1996, when she joined the London-based team of Communications Week International as copy editor. Over the years she held the editor position at Total Telecom Online and Total Tele-com Magazine, eventually leaving to go freelance in 2010. Now living in France, she writes for a number of titles and also provides research work for analyst companies.

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