Reasons for the low take-up of mobile broadband in Slovenia

The latest global broadband report, released on Saturday by the United Nations Broadband Commission, reveals an astonishingly high global growth rate in mobile broadband subscriptions of some 30%. This is the highest growth rate of any ICT. In 2012, it exceeded fixed broadband subscriptions by a ratio of 3:1 (up from 2:1 just two years ago).

Slovenia has dropped seven ranks in mobile broadband penetration to 43rd place in the 2013 global broadband report. The decline is in large part attributable to a slower adoption of mobile broadband technology despite the growth of subscriptions in 2012 was still remarkably high at 26,6%. Slovenia has lost two places and is 22nd amongst 28 EU member states. What is worrying is the gap between the economies with highest mobile broadband penetration that is three times higher than in Slovenia.

Telekom Slovenije – a brief history of its privatisation

Telekom Slovenije, one of Slovenia’s largest and most important business groups, has successfully resisted privatisation since its separation from PTT Slovenije in 1995. Both privatisation attempts were marked with strong opposition against privatisation. For proponents of state ownership Telekom Slovenije has been a strategic company and valuable state’s crown jewel that should remain state-owned. This is the third time the government has considered selling its stake in the incumbent telecommunications operator. The government seems to be determined to carry out the privatisation of Telekom Slovenije. However, its privatisation plan is likely to face strong opposition which is already growing.

The first privatisation attempt – a missed peak of the telecom hype

The first attempt to privatise Telekom Slovenije was made between 1999 and 2001. The government started the privatisation process in 1999 and appointed members of the privatisation commission. In 2000, it hired the consultancy firm PriceWaterhouseCoopers (PWC) that prepared three privatisation models. Each envisaged a reduction of the state’s stake in Telekom Slovenije below 50% either immediately or in a short run of two to three years. 

Minister Pikalo would sell Telekom Slovenije without infrastructure

The Slovenian minister for electronic communications Jernej Pikalo has recently announced that he is going to propose structural separation of Telekom Slovenije. The announcement has come as a surprise as there had been no prior consultation on the issue, neither within the government offices nor publicly with other stakeholders. Besides, Telekom Slovenije has been on a list of state-owned companies for sale and the Parliament has already approved the government’s privatisation plan. The next step in privatisation was made at the end of August when shareholders, the majority of them state-owned companies, signed an agreement to sell a combined stake of 72,75% in Telekom Slovenije, which is valued at EUR 710 million at current market price. The state’s stake is worth EUR 517 million.