Fr, 2.12.2022

Estonia’s home Internet speed is lower than in Russia or Moldova

Carl-Robert Puhm
, majandusajakirjanik
Estonia’s home Internet speed is lower than in Russia or Moldova
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Although theoretically faster internet could reach the consumer via network cable than over the air, this is often not the case in Estonia.
Although theoretically faster internet could reach the consumer via network cable than over the air, this is often not the case in Estonia. Photo: Alessandro Bianchi
  • Connection at 1 Gb/s is twice cheaper in Finland.
  • Data link cable sharing between operators does not work.
  • Having connection is still a problem, let alone its speed.

Despite the popular practice of marketing Estonia as a digital state, the speed of home Internet here is lower than that of such “digital giants” as Russia, Moldova, Bulgaria or Serbia.

An experienced internet user probably knows that if the internet speed does not seem quite right, it is a good idea to visit the speedtest.net website to check it. Since tens of millions of users around the world go to this website to measure their speed, conclusions can be drawn about the internet speeds of different countries based on the collected information. Unfortunately, Estonia's results are anything but worthy of an IT country. While we rate 33rd in the category of mobile data communication, the median result of a home fixed connection (57 Mbit/s) only ranks 64th in the table. All our neighboring countries are in higher places and there are no differences between months.

Estonia's largest telecom company Telia does not have a good explanation for the results. “One assumption is that the speed is mainly tested when a new package is obtained or there are some problems with the existing package. Therefore, the results of such measurements can only characterize the situation of a certain part of all users,” Kristjan Viilmann, head of Telia's private customer unit, believed.

However, this explanation assumes that other countries do not measure connection speed in case of problems. Telia has another explanation. “It must be taken into account that a certain number of Internet users still prefer a fixed connection with a speed of up to a few dozens of megabits per second," Viilmann offered.

Another telecom hit, Elisa, did not answer the questions by the time the page went to print.

However, according to IT experts, home internet in Estonia is slow because there is no serious competition in the market, which would force telecom companies to increase speeds and lower their prices. If, for example, 1 Gb/s Internet in Latvia costs 18–21 euros per month, one cannot get a ten times slower connection from Elisa and Telia at that price in Estonia. For a gigabit connection, one has to pay our two telecom giants 70-72 euros, while in Finland, DNA provides an internet connection with this speed for 35 euros.

“We cannot comment on the pricing of other countries and the related nuances, such as the investments made, the nationwide availability of the service, the technologies used or the quality. We also do not know how much state or local government aid and other support measures have been used to build networks in other countries,” explained the head of Telia's private customer unit.

A newcomer

In Estonia, too, it is possible to get a gigabit connection at home for less than 40 euros. But that is only available to those who live in Saku or Kohila municipalities, where the new service provider Apollo TV started offering superfast internet this summer.

“We came to the market to fill the niche of extremely high speeds. We skipped the 100- or 200-megabit steps and immediately offered only a gigabit connection,” explained the company representative Oliver Ruus.

The monthly fee for the connection is 33 euros, which raises the question of how can superfast internet be provided at half the cost of that in, for example, Tallinn, in a sparsely populated rural area. “This is a service provider which has not made any network investments on its own and offers only a very limited service using the network built with the support of state aid,” said Telia's representative Viilmann.

However, Apollo TV points out another reason. “We were able to choose the most up-to-date technology and the newest equipment. Makers who have been on the market for a long time use older technology, and due to the investments they have made, they carry this so-called historical burden. It also raises prices,” said Ruus.

However, he believes that 70 euros for a gigabit connection is unreasonable these days. “I cannot see any good reason why the packages of large telecom companies should be priced like that. The input cost does not vary by increasing the speeds to justify such a price difference between the packages. In fact, it does not make much difference whether to offer the customer a speed of 300 or 1000 Mbit/s,” said Ruus.

However, Telia objects. “The speed of 1 Gbit/s requires more capable network and client devices. It is logical that if one connection (e.g. 1 Gbit/s) is three times faster than another (300 Mbit/s), then its price is also much more expensive”, said Viilmann.

Competition does not reach the city

Residents of larger cities can now only dream of new service providers and competition, because currently both Apollo and Tele2 offer service only in the operator-neutral optical cable network built with state support. In the cities, the internet network is in the hands of the telecom giants, and the service there is generally provided by the owner of the cable. Although on paper it is also possible to rent a cable, this is a rare practice in Estonia.

“The price of cable fiber rental is not such a big issue anymore. Rather, fiber rental is obstructed by access restrictions. In terms of technology, we could also offer our internet service by renting infrastructure from other operators, but for that we would need to test it first. This again requires good cooperation and transparency. However, since access has been made difficult, we are currently only in a technology-neutral network," said Ruus. However, according to him, the situation may change.

Since the sharing of infrastructure between service providers in the wholesale market is not going as desired, Estonia has also toyed with the idea of ​​separating the retail market from the wholesale market. “Theoretically, this could have a very good effect, because it would make it easier for newcomers in the market to find customers. In fact, building a telecom company today is not nearly as expensive as it used to be. I believe that if the use of networks is very clearly separated from wholesale, i.e. all internet providers could rent the network under the same conditions, it could make the Estonian internet market much more competitive,” Ruus believed.

However, Minister of Entrepreneurship and IT Kristjan Järvan was not in a hurry to approve this idea, pointing out that the subject contains a lot of details. “A very important value is that the entrepreneurs can trust the state. If companies have made and are making investments, they should not be put at risk.”

At the same time, the minister admitted that the situation in the market is not ideal. “A new broadband connection plan is currently being prepared for Estonia, which should be completed by the end of this year. Competition and price issues are definitely an issue that holds an important position when making future plans. But from my experience, I would say that the problem of price and speed does not come up much when talking to the people. Rather, the concern is how fast internet would reach the rural areas at all. The state has begun to address this concern. All new networks will be built operator- and technology-neutral, i.e. equally good access is guaranteed to all service providers," said Järvan.

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