Event: Date: Speaker:

anisesecretaryMobile - Wireless

Dec 12, 2013 (3 years and 6 months ago)



Tele2 Interim Report January

September 2012



October 201


Lars Torstensson

Mats Granryd

Lars Nilsson

Call Duration:



Good morning everyone and
a warm
ome to Tele2’s third quarter 2012
conference call

The reason for the slight delay was because of a technical snag.
It’s now solved. We feel very comfortable about that. So let’s continue. My name
Lars Torstensson

and together with me today I have

our President and CEO
Mats Granryd,


Lars Nilsson.
Now we are able to
send th

presentation live
over our dedicated web page
, s
o I
would like to take the
opportunity to welcome everyone that has joined us via

After the forma
l presentation


as always

there will be a chance to ask questions,
either over the phone or
it’s also possible to
via the web

format as
But enough said by me.
Mats, could you walk
through the third quarter?


thank you very much
, Lars.
ood morning, everyone
, from a rainy Stockholm

would like to present the

third quarter results. We feel
that this is a robust quarter,

very much in line with the second quarter result
. We ha
d an
of 1.4 million new customers, so we’re almost at 38 million customers,
customer base

ales grew with 9% to just shy of SEK 11 billion, EBITDA just about SEK 3 million,
and then margin is down 28%. Worth noting is that we have never been as high as
billion before, so this is a record quarter from that perspective. CAPEX SEK
1.2 billion, SEK 1.3 billion.

let’s move over then to

Russia. Russia
stands for

30% of

sales in the
quarter. Some of the highlights: we added 710

new customers, whi
ch is a very
good customer intake; EBITDA margin up 1% from the second quarter
. It’s

37% up


to 38%. I would also like to highlight the fact that ARPU is growing, and the growth
rate is 4% year over year. (
) is up 7%. Revenue, as I said, grew w
ith 8%
in the quarter. New regions margins is up to 14%, old regions is at 47%. So, all in

a very stable quarter with a very good customer intake and you can see on the
upper left
hand graph, market share is now at 9.5%. The ARPU development

4 per month and that is equivalent to the 4% growth

as I said.

Last quarter we added an astonishing 40% of all net adds. This quarter we don’t
know yet, but we have a good chunk of 710,000 to start with and we


see what
the other competitors come in

with. Also encouraging is to see that the annualised
churn rate is still on a low level. We are at just shy of 8% per quarter, so it’s around
30%, 32% on an annualised basis, which is significantly lower than our competitors
nd that is one of the pos
itive signs and positive impacts that make our net editions
so very strong.

If we move on then to our sources of revenue in Russia: 92% comes from voice, 8%
from data and

if you look at the year over year growth rate, data grew with 12% and
voice with 8%
. Of course we’re happy with the 12%, no doubt, and as you all know
we are only on 2G

on edge, so with 12% we’re happy with that. However, our
competitors are of course growing significantly faster on data. They might be up to
double percentage poi
nts than what we have, but 12% on edge is a good result on
data growth.

Moving on to the regulatory update, as you know, we are disappointed on the no
decision on 2 October, or the technology neutrality. There will be another meeting
in December we belie
ve, and there will be further studies conducted between now
and that meeting. We do not think that there will be a decision at that meeting, and


when techno neutrality will happen is still written in the stars. However, we believe
firmly that it will hap
pen. The question mark is when.

We have also chosen to put in the new regional licences, so it is nine new licences,
so on the 1800 band. They will be distributed some time in the future. We don’t
know exactly when and we do not know exactly the princi
ple if it is going to be a
beauty contest or a paid auction. These are in good regions, regions where we are
not present today, but it is not a whole lot of megahertz

I think it is up to 10 MHz in
a region, and then it can be down to just a couple of me
gahertz in other regions.

Worth noting as well is that in LTE development E
KS Consulting has done a study
on what percentage of the Russian population that will have LTE by 2015. If you
remember we did a similar study in Sweden and we think that by 2015

roughly 20%
of the Swedish population with have LTE or a 4G subscription, and the same
number in Russia is 5%. We can sort of conquer with that we think. That is a fair
assumption: Sweden 20%, Russia 5% on 4G subscription by 2015. So with those
words I


you know, we are disappointed but it is not a falling off the cliff event by
no means. We have plenty, plenty of time to make sure that we get the data

Moving on then to the forward looking statement. In Russia we have increased our
ber base slightly from 22 to 22.5. ARPU is still 3% to 5%. EBITDA 37% to
39% and CAPEX we expect that to be between SEK 1.3 billion and SEK 1.5 billion.

Okay, so let’s move over then to the Nordic region: 40% of our revenue comes from
the Nordic, which
is Sweden and Norway. Let’s look at Sweden firstly. We had a
service revenue growth of 4% year over year, which we’re very proud of, and you
should also know that SEK 966 million in EBITDA is the highest ever in Sweden.


So that’s another first and anoth
er high which we’re also very proud of. The
EBITDA margin is 33% and of course is affected by the introduction of iPhone 5,
and I’ll go through some of the sales numbers on iPhone 5 later on. We believe that
we have increased our market share slightly on

, and we believe that we
have lost slightly on
, but very small changes in the market. We have
added 60,000 on

customers and we have lost 30,000 on
, so we
have added 34,000 mobile subscribers in total, post and

Just a slide on what we believe is going to be the future. We are strong believers in
the bucket price plan, and on 15 August we launched Convik(?)
, where
everything will be on line and it’s only a SIM only offer. You can see that our
e products, the low, medium and large, has continued in good demand going
forward. I think that with this

what we would like to say is that we believe in bucket
price plans where you include data, voice and SMS in one bucket.

Moving on then to some of t
he developments on the 4G and 2G networks, we have
today a population coverage of 80% in Sweden and we are committed to do 99% by
yearend on 4G. As you might be aware, we are
moving over all our networks
to the shared network, something called MOCN, M
ultiple Operator Core Network.
We have activated that in two regions of Sweden and in a couple of weeks’ time or
actually sooner than that, in a week’s time we will move the east coast over as well,
so we will be in a combined network together with Teleno
r in our joint venture net
bility. By doing this we are saving quite a lot of money and we estimate it to
be around SEK 300 million, SEK 350 million. Now this is gross. This is nothing that
we will see on the bottom line. You can argue that by doi
ng this we are actually
getting one network free of charge. You can also see that the SEK 300 million,



350 million and saving on gross means that we will continue to focus on
marketing activities and continue to be pushing good offerings out to th
e market.
This is the typical Tele2 way of doing things, of being brutal on costs and making
sure that we have money over to do interesting stuff in the marketplace.

The next slide on the Smart Phone development. I think if you start with the graph
can see that in April you had a little jump up, and that was the 345 campaign,
and after that it has been a fairly stable growth rate on Smart Phones. We have
now an installed base of little more than 70%. It is worth also noting that iPhone 5
have taken

a number three position, and that is only after three days of sales in the
third quarter

which I think is pretty astonishing. This is then a combined top ten list
of our stores,

subscriptions in our stores.

Good. So then moving on to the for
ward looking statement in Sweden. We believe
that service revenue growth will be around 3% to 4% and the EBITDA margin will be
between 30% and 32% but do need to say,
well, we believe it is going to be in
the lower end of 30% to 32%.

Moving on to Norw
ay. We have a strong focus on our network rollout in Norway.
Today we have roughly 45% of Norway being built out on our own network and
roughly 30% of the traffic volume is on our network, and we’re aiming for 75% of
Norway to be built out

the third

network. We had a good intake of new
customers, 14,000 new customers. Our market share in Norway has increased
slightly. I shouldn’t over emphasise that, but from 18.5% or so up to 19%. As you
can see later on

that we have had

we are guiding for s
ignificantly less CAPEX
expenditure in Norway and that is due to two things: one is that there is a 4G licence
that has been postponed to the future; and the second is that we have had some


difficulties in being able to co
locate our base stations in our c
ompetitor sites. This
is something that we have made the NRA aware of, and it’s not our intent not to
spend but it is our inability, if you would like, to push forward there. So that is
something we are focusing on to continue to build out the network.

Looking at the forward looking statement, the revenue we believe will be in the
lower end of the guidance of 4.8 billion to 5 billion EBITDA. We have increased that
from 2%
3% to 4%
6%, and as I said CAPEX we have reduced the guidance down
to SEK 450

to SEK 550 million.

Okay. Moving over to Western Europe, 16% of our sales come from Western
Europe. Starting with the Netherlands, I would say a stable financial performance.
Net intake on the mobile of our plan 51,000, so areas that are going well

for us is
the mobile as well as business to business. We have in the quarter attracted

continued some strong brand names. Accor is one. A couple of water companies,
the Dutch railway and many more have joined us in the business to business

Where we are feeling pressure is on the residential side. We have
historically been strong with our single and double play offering. Now lately triple
play is becoming more and more important, and we are not competitive enough
throughout the market on o
ur copper lines there. So fixed is under pressure,
residential is under pressure. The mobile side and the business to business side

going very well for us. So it’s a little bit of a mixed bag in the Netherlands.
Financially it’s stable.

Moving ove
r to Germany and Austria. Germany I think is a fantastic example of
how to milk out as much as one can. We are no

at 30% EBITDA margin, pretty
much where we were a year ago from now. This is despite the fact that we have


lost almost 20%

or actually s
omewhat more

in fact, 3% of our subscriber base,
but we still manage

to keep our EBITDA margin up, which I think is a very
encouraging sign. In Austria we are doing a lot of good activities. We’re focusing
on consumers and on the SME side, on the busi
ness to business, and we have
seen improved sales in the Vienna region after we acquired the Silver Server

and that is yielding good results for us in Austria. The EBITDA margin, as
you can see in the graph, is slightly improved quarter over quar

Moving then over to Central Europe and Eurasia, 13% of our sales is coming from
that region. I will not spend too much time on these, but Estonia a very stable
financial performance, positive net intake of roughly 10,000 customers

and we are
ising our network and rolling out 4G. Moving over to Latvia, tough
competition in the market, EBITDA margin 34%, customer intake strong with 21,000
new customers, and we will launch 4G when we see that it is commercially
attractive for us. Lithuania then

38,000 mobile customers added in the quarter.
EBITDA margin of 35% and, yes, there is a continued strong performance of
Then i
f we take the next slide you can see that this is a true success
story. One should know that we started this operat
ion by ourselves ten years ago in
2002, with only licences, nothing, and now ten years later we are the undisputed
number one, literally, regardless of how we measure. We have a market share of
subscribers of 53%. We have a revenue market share that is

yes, it’s very close
to being number one if we’re not number one, and on EBITDA we are also number
one on market share. So, regardless of how you measure, Lithuania is a true
success story. Croatia is not that much of a success story yet. We have howe
had a good quarter of positive intake of 33,000 customers in the quarter, and we are


focusing to maintain the positive cash flow. As I think you are all aware, we have
changed the management. It is still very early days but we are seeing positive
nds in the market. So a lot of focus and a lot of hard work

to go into
Croatia. The forward looking statement in Croatia is that we beli
ve the EBITDA
margin will be between 4% and 6% for 2012. The last country is Kazakhstan. A
very good strong cu
stomer intake of 589,000 customers. We now have 3.1 million
customers in the country and we are

to focus on a rapid rollout of new
base stations. One should note as well that we have a very good data network. We
have pushed ourselves further
out in the region and we can see now that ARPU is
decreasing slightly. Due to that fact we see the purchasing
power out in the regions

slightly less than the bigger cities, which is to be expected. The revenue growth
over the first nine months is asto
nishing, 134% which I think is fantastic, and we are
focusing and continue to take a lot of subscribers in Kazakhstan. The market share
now is around 10.5% in the second quarter, and that is after 18 months of
operations or so. I think that is a very goo
d development. The last quarter, as you
can see, we added 55% of all net adds. This quarter we still don’t know. Beeline,
Kcell added slightly more than what we did but we will still have a good chunk of the
net adds in the quarter. So I think we are d

posting on very nicely in
Kazakhstan. The forward looking statement is pretty much the same. We have
moved up the subscriber base from 3 million to 3.4 million. We have the same
EBITDA contribution. We have lowered our CAPEX expenditure slightl

from 550
million to 600 million down to 450 million to 500 million. We are committed to have
EBITDA break

even in the second half of 2013, so basically a year from now. Of


course we believe that we will be able to reach a 30% market share at one
ird of
the market in a more longer term perspective in Kazakhstan.

So with those words

I would like to hand over to Mr
Lars Nilsson

to go through the
financial review.


Good morning, just a short review around the numbers. First of all, on

this PNL
statement you can see that we had net sales of 10.9 billion and
an underlying
growth of 9%, and then as already mention a record EBITDA. Now we are

start with 3 billion and a margin of almost 28%. The normal appreciation is around
.5%. I will come back to them. Then during this quarter we have three non
recurring items or one
off items. Two of them affecting the EBIT result, and that we
reported about last week, and then we also have a one
off item when it comes to
taxes, which I

will come back to.

So with that I think we can go to the next page, where it’s just the full year
statement, which you also see, and then we go to the currency impact. The
currency impact, as you can see here on this slide you see our three main
es, and there you can see that on average we see krona strengthen again

the euro of some 3%, but if you look at the situation when we end the quarter the
euro was down almost 5.5%. You can see the same trend for the rouble: 1.5% if we
compare with the s
ame period last year and then
2% at the end of the quarter.

Coming back to depreciation, somewhat down compared to what you saw in the last
quarter and if we compare the numbers year
year we have to add a net
) of course, which will impact de
preciation with SEK 80 million. Then we
have speeded up the depreciation for the networks in the Baltics, due to the fact that


we are just in the middle of a swap, and a reduction in Sweden due to the fact that
the old 2G network now is written off, but t
hen of course we have to handle the
growth in Russia and Kazakhstan

and there we have added in SEK 61 million. And
as already mentioned 10.5% of revenue is depreciation.

Financial items, yes, just to explain interest
has cost SEK 259 million in li
with what I think you should assume, and then you can also see that we have added
the cash flow effect. The cash flow effect of interest paid for the period is SEK 154
million. The same numbers for the full year

interest costs net of SEK 710 millio
but the cash flow is affected by some SEK 400 million.

To continue with taxes, what you can see here is that we had a normal tax cost of
SEK 380 million for the year, so far almost SEK 1 billion. Then we had a positive
off item

due to the fact that

we could actually have a devaluation of deferred
tax assets in Austria, where we could add another SEK 262 million on the balance
sheet. Deferred tax assets now amount to SEK 2.5 billion. What you can also see
for the quarter as well as year to date tha
t we have had a positive effect, if you
compare with what we actually have as taxes in the income statement compared to
the cash flow situation. That is just due to the fact that we can utilise our loss


Cash flow, I would say a very stable
situation for the quarter. Cash flow from
operations is strong at SEK 2.9 billion and then we also had a positive change in
working capital of SEK 244 million. If you look at the full year we have a negative
outcome of change to working capital of a litt
le bit more than SEK 400 million. That
is mainly due to the fact that we had to put more handsets in the balance sheet to
the handset sales, and the main source of this is coming from Sweden.


CAPEX for the period, the cash flow statement is SEK 1.1 billio
n and year to date is
SEK 3.3 billion. There I will fortunately tell you that we have built our forecast
statements a little bit when it comes to

a little bit we have built up the forecast
when it comes to Kazakhstan because there we actually talked ab
out cash flow
CAPEX. We will make a correction so we can guide you in the right way, but
actually we have from the beginning talked about cash flow in Kazakhstan but that
will change. I apologise for that.

Then we go over to the debt profile. We now hav
e a net debt of SEK 15.2 billion,
and on this slide you can also see the different sources of financing, and you should
note that we are not utilising our revolving

facility of SEK 10 billion, and you
can see that is a credit for
contingency. We
think that we are in a good situation
when it comes to the debt profile, when it comes to tenders and sources.

Finally, I think it is
almost there
, the debt position. You know that we have our
frames when it comes to net debt to EBITDA and we are close to

125. We are not
there. You can follow the black line. You can see where we are. As I already said

the net debt was SEK 15.2 billion.

Finally, group financials, I will just focus on return on capital employed. There you
can also see that this quarter

was from a financial point of view, and also from other
points of view of course, a very strong and solid quarter.

With that I leave the word



Thank you very much, Lars. Some concluding remarks then. We continue to grow
as an operator.

I think it is important to note that a couple of years ago we took a
strategic decision to move into mobility, and that has paid off. At that time we had


far more sales on fixed than we had on mobile. Today our mobile portion of
revenue is more than 80
%. So I think the growth that we are seeing comes from
mobility and also, the second concluding remark, managing the shift from voice to
data. I think it is really imperative that operators are focusing on

and we are
focusing on

the shift from voice
to data. We need to realise that we’re entering
into a data
centric world and that is slightly different of that of a voice
centric world.
The continued migration from


we believe that having a longer
term relationship with customer
s is ultimately better than to have a short term
relationship, so we welcome the migration from


Of course we do want to exploit new services and opportunities by offering our
customers what they need for less. That is
our visi
on and in our mission
statement. What they need for less is back to the best deal, to make sure that we
continue to be cost focused, continue to make sure that our customers appreciate
our service from a cost point of view, and also

new services, l
ike the plus 46,
the roaming buckets, the WyWallet initiative we had in Sweden and other services
like that going forward. So with those words, I would like
to hand over to

Thank you, Mats. That concludes our fo
rmal presentation regarding the result for
the third quarter 2012. I would like to make a small but important disclaimer as the
last quarter we will not be able to answer any questions about the upcoming licence
auctions in the Netherlands today. But of
course we are happy to answer any other
questions you might have.


So with that said, we will now be happy to take any questions

may have.
Operator, let’s start with the first question.


The first question comes from

Mr Andrew Lee


. Please go


Hi, morning everyone. A few questions on Swedish mobile if that’s okay. It was a
good performance in the quarter, but why should we not expect competition to
accelerate here? I mean Telia has just gone ex
growth in

the region, and that’s
partly due to your foray into corporate mobile. Do you not expect it to retaliate?
And why should we believe you can continue to grow in Swedish mobile when there
is barely a market or company in
European mobile that is managing t
hat? And then
just an additional question

is it a slight change in rhetoric, what you said
earlier in the call, that you will use cost savings from your network turn off to market
more aggressively? Thank you.

Thank you, Andrew,

I think those are two excellent questions. I believe that Mats
Granryd could have a stab at them.


Yeah. No, on the Swedish side obviously Sweden is a highly competitive market,
four operators with only 9 million people. But I think, as I

said in my concluding
remarks, it is really important to be lean and agile and nimble to understand what is
going on, when we’re moving away from

to data. We think it’s equally
important to focus on mobile mobility. The vast amount of sales is com
ing from


mobile in Sweden. We are focusing on the business to business segment to
augment that offering as well, and that is going nicely for us. We

we are
taking market share in the business to business segment,
and I don’t think that I can
much more than that.
We’ll see a continued highly competitive environment in
Sweden, and that is nothing new to us.
We do not think however that there will be
the type of price wars that we saw in the spring. We don’t know that obviously but
we don’t se
e any signs of that.

When it comes to the cost savings on the network, 300 plus depreciation of 50 or
so, the SEK 350 million to SEK 400 million, I think what one should take away from
that is that by sharing networks we save a significant amount of money
, and in the
formability mobility case it is around SEK 300 million to SEK 350 million gross.
We will not see that on
the bottom

line. You can say that that money will go in order
to get two networks. We have had yesterday a 2G network and today
2G and a 4G network without pu
ing in extra money. So we can do that by saving
on operation and CAPEX costs by moving into a shared network. I also think in

what I tried to express, but maybe I didn’t do that good enough, that the continued
rong focus on our costs leadership position means that we do have
manoeuvrability of launching new products, we’re not going to be aggressive in the
and we’re

not going to initiate any more price wars, for sure not. But we will

be able to sustain
increases i
n costs slightly, due to the fact that we are so good in
managing our cost portfolio. And we are not launching

and you know that as you
have followed us for a couple of years

new cost savings programmes. That is
something that is inherent
in our DNA.


Thank you and I hope that answers your questions.


Yes, nearly.

Operator, c
an we have the next question please?


t question comes from

Mr Barry Zetuni
. Please go



Hi, good morning, gentlemen, I’ve got a few questions. Actually, if I just quickly
follow up on one of your answers to Andrew’s question.

you just

tell me
whether the SEK 300 million to SEK 350 million cost savings is increme
ntal to
where we are today, or whether you are actually seeing some of those savings
already? My second question also on Swedish mobile, is looking at the margin that
we’ve done for the quarter of 33%, my understanding is that the exit rate in
September w
as lower than the average for the quarter. So how can you be
confident that you can do a 35% margin in Q4 and meet the bottom end of your
guidance with that 35%, so how can you be so confident that you will see such a
material pick up in margins as we go
to Q4? And how does that make you think
about margins going into next year as well?

Then if I can also just

I know you won’t answer questions on the Dutch spectrum
auctions, but if I can just take your view in terms of how you think we’re doing in
s of mobile ads in the Netherlands and whether that has given you any kind of
clarity or given a positive impression on what you feel might make the benchmarks


of a mobile strategy, were you to continue accelerating additions or try to continue
g additions in the Netherlands?

Then my final question is just on Russia. I just want to have your take as to why
you think the state commission on radio frequencies has delayed the decision on
technology neutrality. Thank you.

thank you, Barry. That was a lot of good questions there. I think we will do
it like this. So, when it comes to the network savings and how to reach the margin
target, that is of course a Lars

question, supported by us, and then we have
mobile p
rogress in the Netherlands, Mats. Then I will take the opportunity to have a
stab at technology and strategy in Russia. So, please, Lars would you begin?


Yes, I don’t know if this will answer your question but I think the way you can see
his is actually as much as we have gross savings around SEK 350 million, but that
also in a way means that we will have
one network for free
, and that is sort of

we should maintain on the level of what you see right now. I think that is a good
wer. But then we will get a totally new and fresh 2G and 4G network.

But I mean when it comes to the network benefits, I don’t know if we could say
anything there because we’re just working on merging the two networks.


es, just working on merging the two networks and you also know that we have
taken some extra depreciation costs this year. But of course going forward there
will also be depreciation for the new network as well as for the 4G licences. All in all


we will
sort of have


... I think it’s a good way of saying we will get one network for

Yes, and then when it comes to Sweden mobile.


Yeah, when it comes to Sweden mobile.
I mean you said: how can we be so
A f
orecast is always a forecast

but based on the performance so far
and based on the portfolio we believe that the guidance we


you is
achievable. I don’t think we can give you a better answer than that.

No, but you are correct
, Barry. I mean September was associated with a lot of
activities. Of course the launch of the iPhone 5 did require a lot of preparatory work
from our side as well, and hopefully when we go into the fourth quarter some of

been already taken, or
we have invested in that launch as well which is
something that we might not have to do then going into the fourth quarter. The
mobile progress in the Netherlands, Mats?


Yes, no, as I said

we have had a good quarter of 51,000 new customers

and our
fixed portfolio in the Netherlands is under pressure, and I think that our MVNO
brand is working nicely for us and we’re going to continue to push that and see how
much money we can get out of that. We need to differentiate ourselves and hedge
rselves, if you would like, slightly away from only being a fixed operator in the



Can I just ask how are you differentiating

with your mobile strategy in the


Well, I mean we are still a disco
unter brand and we have launched some new
products whereby you will be able to compose your tariff plan as you wish, with both
data and voice, a little bit more tailored to your own needs, like we had in Sweden
for a while. And I think it’s no secret that

the discounter position that we’re having
with our footprint is a very successful position to have, and that is our strategy.

Okay, when it comes to Russian and technology neutrality, I think as Mats said
before we do expect to see sup
port from the regulatory board towards regional
operators going forward. The delay in technology neutrality should probably be
seen in the light that there was earlier on this year an auction around new dedicated
4G licences, and there needs to be some co
mpromising on top of that when it
comes to how technology neutrality should be introduced, in combination with
requiring the new licence owners to free up
spectrum and rolling out
their 4G
network over new frequencies. So we are not surprised that t
echnology neutrality is
a topic that is being debated. The only thing that we are asking for is clarity, clarity
on when technology neutrality could be introduced. And as Mats mentioned before,
there is a lot of statistical evidence saying that there is
no rush to introduce LTE, but
from our perspective it would of course be appreciated if we could get clarity on
when we could start using it commercially so we could start preparing for that. But
currently, the regulator is asking for more test results an
d those
test results should
be done together with

between all operators. So you will see us doing tests


together with the
big three and also Ross Telecom, and that result will be presented
on 1 December and then we will discuss during the GQRCH meeting

on 7
December, so that is what we see.

But as we have said during this conference call we are still expecting support

region operator model and that technology neutrality would be very beneficial to the
Russian state.


. Thanks

very much, guys.

Thanks. Operator, could we have the next question, please?


t question comes from

Mr JP Davids

at Barclays
. Please go ahead.


Yeah, hi. Good morning, guys. Two questions, please, the fir
st one on Russia.
Your guidance implies a slowdown into the fourth quarter. The question there is
why not just carry on pushing for subscriber share while the market seems to be, as
you call it, quite balanced at the moment, and so sacrifice a bit more s
hort term
margin for scale? And then coming back to Sweden, just as a precedent, Mats
mentioned evolution from voice to data. Maybe you can just touch on the sort of

you’re seeing pushing subscribers from 3G to 4G, i.e. the cost savings
per sub
scriber or the data efficiencies you’re seeing as you’re pushing up the
technology bands. Thank you.


Okay, thank you, JP. That is a good question. I think they are both well suited for


Yes, I’ll try. The Russia

if you say why not continue to

more subscribers. I
think, you know, life is grey. It’s not black and it’s not white. We do need to make
sure that we get sufficient amounts of money out of our customers as well. So
having that healthy balance betw
een growth and profitability is what we’re aiming
for. We think that we will be slightly less aggressive in the fourth quarter

comes to

and you can see that from our guidance as well on subscriber growth.

So that’s Russia. On Sweden then the
voice to data and 2G, 3G, 4G, it’s still very
early days. As I said, we cover 80% today
. We have ambition to cover 99% by the
end of the year. Our 4G network is growing faster than our 3G network when it
comes to data, and you should know that our 2G ne
twork in Sweden, our legacy 2G
network on Motorola equipment did not have edge capability, so it was only GPRS.
What we’re now doing is to migrate over to one network in
net formability
, and that
network will have state of the art 2G, including obviously
edge, GPRS and it will also
have 4G in it. So I have no problem saying
we will have, if not the best, among
the best networks in Sweden when it comes to both capacity and coverage, but
exactly how much the financial voice to data, I think that is a v

question but
it’s a little bit too early for us to elaborate on it. Our 4G network is growing faster
than our 3G network. That is so though


And we do expect a much more efficient network compared to the 3G network.



Absolutely, and we have done several different studies on how much more effective
it is, and you can say that 3G is three times more efficient than 2G, and 4G is
another three times more efficient than 3G.
But I would keep those numbers very

Yes, because at the same time we see that we need to cater for much larger
volumes as well.


Yeah. Yeah.

And there are moving pieces here that we don’t yet have full control over.



one can say is that in our strategic ambition we are focusing on two things.
We’re focusing on our network to make sure that our networks are fully data
capable and state of the art in all that. We believe network is really critical for us,
and we also

in the customer relations. That is absolutely critical for our
success to have a tight relationship, and remember what I said in the concluding
remarks, moving from

, even though the

normally has a higher pro
fitability we believe that in the long term it is better to have
a long term relationship with customers. So customers is key, customer care is key,
shops are key, innovative tariff plans and applications are key, and our networks are


I guess you can say when
consider the


migration it

wise a prepay customer is better but if you look at absolute contribution over
the term then the

customer is much better, so you’ve got to see a
tendency o
f that. I mean we need to

it’s not a margin focus for us of course but,
going forward, as we’re moving on and we see the absolute contribution hence the
absolute value for the group might be lower margin but the value for us over the
longer term is bet
ter, so I think that is something we need to discuss further going



Yeah. Okay, operator, can we have the next question, please?


The next question comes from

Mr Andy Parnys

at UBS
. Please
go ahead.


Yeah, hi, guys. Thanks for taking the question. Two questions, one to just quickly
follow up actually on the

migration. It seems to be that you’re winning
share now in

and potentially losing it in
. C
ould you give a bit
more detail on, I guess, what the ARPU uplift is from moving a customer on average

? And then also how many of those
, new

customers, are SIM only versus those that are getting a subsidised

And the second question was on Russia. You seem very confident that you will get
tech neutrality. That’s a question of when it will happen. Can you just give a bit


more detail on what discussions you’ve had that make you so confident that it is

question of timing and that it’s not definitely off the agenda? Thanks.


Yeah, I can possibly ...

I can possibly start with the second question which
was even though it’s difficult maybe it’s slightly easier than your first question
. I
don’t know, Lars, if you can take the first question maybe or the


migration there.

On technology neutrality, the Ministry of Mass Communication has been out talking
very positively about tech neutrality, on several occasions, bo
th Mr Niki
orov the
Minister and also the Deputy Minister, Mr Denis Sv
, in several medias. And I
think that is for us a key point that they believe in shared networks, they believe in
tech neutrality. They believe in regional operators and they bel
ieve in united

making sure that Russia is not divided through less good digital means, so to speak,
bridging the digital divided. So I think all those components are talking in the way
that tech neutrality will happen. And when we meet other region
al operators they
claim the same thing. They are confident that technology neutrality

The question is when.

There are several obstacles. One is of course that the proposal was that tech
neutrality on 4G on 1800, the band was 10 MHz. The bi
g three, including Ross
Telecom, I believe got a 4G licence this spring and
the band width
of that
was 7.5
MHz. So that means that they need to share networks in order to make the 4G
spectrum useful. That is of course another sort of constraint that the
ministry needs
to deal with. How to handle the 7.5 MHz versus the 10 MHz. Now for us we, as
Lars said here, we would like to have clarity. We might not start pushing out 4G or


LTE services for several years but we would like to have clarity, and I think

what the investment community would also like to have.
And for us the less
spectrum the better.
However, 10 MHz we can certainly handle that as well.
many regions we have 15 MHz or more spectrum, and so dividing that between 2G
and 4G is cert
ainly doable.
So I don’t think I can paint more of a picture than that.

We don’t think that there will be a decision in December but we hope to have more
clarity on the process going forward.


and I would have a take on the


migration. I think when it
comes to ARPU and ARPU assumptions, as an operator we like to move away from
that. We are not that focused on what the SIM card can do but what the account
can do and how much money we can make on each individual.
I think that that’s
why talking about ARPU and ARPU contribution over time, you end up

there is of
course a positive movement going from

. We believe that it’s
more important to talk about the total worth of that account. It might

be that the
individual has two SIM cards

or three SIM cards, and that is what we need to
service. And your second theme(?) and third theme with a yield less than your first
theme but they are still very valuable to us. That’s why I would like not to go
into a
specific SIM card for SIM card discussion because that is getting

that KPI
specifically is getting a little bit old and outdated, because now we need to talk
about can we grow as an operator, which I think we have proved in this quarter, and
should we cater for that growth going forward as well. So that is more


Thank you. I hope that helps.

But, Operator, could we have another question


The next question comes from

Mr Ulrich Rathe

at Jefferies
. Please go ahead.


Thank you very much. Three short questions please. And the first one on the
Netherlands. You mentioned that the market is moving triple play and you’re having
some issues there with the fixed set up. Could you talk about how you actuall
y see
potential for mobile only growth or your standing in the market, when the market is
actually moving triple play. How a
re you intending to address this trend that you’re

The second point is on Kazakhstan. You are attributing the ARPU trends

to moving
into the regions, but I think there has also been some price pressure from Beeline I
think, in particular, who has sort of pushed back against you also in the more urban
areas. Was this also a contribution

was this unexpected and how would y
ou react
to that?

And the last one is on Sweden. I mean just very tentatively putting your service
revenue growth of 4% into the numbers
, it

looks to me as if the equipment revenues


SEK 50 million
or so sequentially, so significa
ntly less
equipment revenues in the third quarter. How does this gel with the comment about
the iPhone sales and the margin impact, if you had really so much less equipment
revenues in the quarter? Thank you.

Thank you. Three good qu
estions. I think, Mats, can you please?



Yes, I can start. Netherlands, triple play, you’re absolute
y right we are under
pressure on our fixed offering
. Previously one play and double play worked
perfectly okay on our fixed copper offerin
g. Now with triple play coming more in
vogue we do have a problem there, and the way that we handle that is to focus
more and more on mobile. You know, we have the MVNO set up with Team Mobile,
and then that is what you can see that we’re growing nicely
on that set up. And
we’re doing some more experiments on the fixed side, but I would not emphasise
that. I would emphasise the mobility would be our avenue as an MVNO to continue
to grow in the Netherlands.

On Kazakhstan, you’re absolutely right, ARPU i
s trading down slightly and we see it


as I said, we’re going out to the regions. The purchasing power is less, less there
than in the cities, but obviously there is price pressure from our competitors.
They’re not sitting still. Both Beeline and Kcel
l have been aggressive in the market,
no doubt about that. We have a

as we have in Russia we have a superior

would argue at least

cost structure and a superior operation in Kazakhstan. So we
are competing that nicely. But for sure there is pric
e pressure in the major cities as

And on the Sweden less equipment (overspeaking)

I should say that discussion

when we talk about underlying
service revenue
growth, we talk about service revenue growth excluding the impact of
connect service revenue growth was around 2%, so we still have


some equipment sales there. So I think that we need to go through that calculation,
Ulrich. So that one we should not step away from, not at all.

We’re quite
happy with how things have developed during the quarter and there is
still a large component of equipment in the numbers.


Thank you very much.

Thank you. So, Operator, can we have the next question, please?


e next question comes from

Ms Lena Östberg

from Carnegi
. Please go ahead.


Yes. I'm sorry to come back to this question on the gross and net savings from
launching of the new network in Sweden
. B
ut if I remember correctly when you
d this

there should be significant savings from the
line on
electricity because the old GSM network
was significantly outdated, and also

I mean you’re saying you’re getting two networks but you’re actually
running 4G and 2G on the same n
etwork. And you’re sharing it with another
operator so, therefore, I find it really difficult to understand why there should not be
any net savings from this?

Okay. Thank you very much, Lena. Of course we need to elaborate a little b
more on that. We’ll see if we can do that. Lars Nilsson, would you like to start?



No, no, I can say what we pointed out if you look at all costs round the network
going forward
compared to what we did in the past, and you should also ta
ke into
consideration the depreciation of the licences and all these aspects. And we are
actually now

if you look at the new network we are running also on 2G. We
actually have more
base station
s operating there compared with the old network.
So henc
e, we think that it’s a good achievement that we actually can run this
network on the same total cost, including everything I would say.

Yes, and you should remember we have built

this is Lars

and we try to
emphasise this of course
that the alternative would have been building this by
ourselves and now we get a brand new 2G and 4G network for the same cost as we
were running more or less an old network for, the old 2G network for. So it’s been a
great achievement, and something that

we will benefit from.

Then it always becomes like that, Lena, I mean that in the end the question is what
if we would not have done this? We are always looking for additional savings in
operations and this has been a significant saving for us, but at th
e same time we
have had

the market has been changing and we have been able to maintain
profitability fairly decently during that time period as well, so I think you do see some
of the benefits already today. However, having said that, we are still work
ing on
merging the two networks, yeah, and reaping the benefits also going into next year.


Once again I would like to emphasise that this is total cost including depreciation for
the licences and all that stuff, and then we are actually havi
ng access to more base
stations than before.


Exactly. I think we have increased the amount of base stations by around 15% or
something like that, which means that we also get a greater

or even 20%, which is
giving us an even greater

benefit also when it comes to compare ourselves to the

on the quality side, which is also very important of course when it comes
to gaining interest, for example, from the business to business side where it is
crucial to be able to come up with
a very good proposition when it comes to


But if we look at how much you have still left to close from the old GSM network,
should we not expect any additional savings when you close that down?

When we close the
full network down in Q1, so to speak, if we get additional
savings then? I don’t know, Lars, if we are ready yet to
elaborate on that?


No, no, no, I think you can see some of the savings now, Lena, when it comes to
the depreciation has come

down but now we will gradually move into the new
situation and I think we

going forward

maybe can come with some more detailed
forecasts, but I think right now we can assume that it will be to run the new network
for the same cost as the old one.


Okay. Can I just ask a final question on Swedish mobile then? You said you’ve
taken some investments ahead of the iPhone launch. Can you say maybe how


much they were in the quarter, and what they were if they were sort of built up of
y or if there was marketing related?


Lena, y
ou broke up there. Can you just repeat that question, please?


Yes. You said that you’ve taken some extra costs ahead of the iPhone 5 launch in
Q3, which you would not have to carry

in the fourth quarter. So I was just
wondering if you can say
maybe roughly

how much th
at was and what it was related
to? I mean how much was inventory build up? How much was marketing?


No, Lena, we don’t go into that. As you know, it’s

very exclusive what we have
when it comes to volumes, prices and so on. And we are not allowed to talk about
that from that perspective, I'm sorry.


Thank you.


Thank you.

So, Operator, do we have another q
uestion, please?


The next question comes from

Mr Thomas Heath

. Please go



Thank you. A few
. You mention the long term sort of view on LTE to
reach 5% by 2015, and I believe you’ve previously sai
d that without tech neutrality
you expect growth in Russia to last 18 to 24 months. Does this mean that you in
your internal forecast expect flat or negative growth in Russia before LTE takes off?

and the second question
on the new regi
onal licences coming up.

Is it worth

bidding cash for these regions without having tech neutrality?

Third question on Croatia. As I understand it, the brand is a little damaged in
Croatia and it’s been tough over the years. Would you consider divesting


And lastly, Norway is doing very well on EBITDA. Can you sort of extend this over
the coming years? I previously had a view that you were locked into traffic
agreements with Telenor and Tele
onra, which sort of prevented EBITDA from


Thank you, Thomas, so we have two questions on Russia, one on Croatia and
one on Norway. I guess, Mats, whose would be for you, I think?


Yeah, absolutely. The first one, LTE Russia 5% 2015, and what we said be
fore is
that our 2G offering we believe will continue to grow for several more years. You
said 18 to 24 months, and maybe that is being pushed out a little bit, but in that
region. Then we’re going to see a levelling off
we believe

on our 2G offering. I

that is where we are and tech neutrality or a way of achieving a data licence will be
important for us in coming years. And I say that just because I want to make sure
that everyone understands that we’re not pushed against the wall here. We still



good growth in our 2G offering. LTE is growing 12% year over year. However, in
the future having a good data offering will be, you know, pivotal of course to our
success but it’s quite some time in the future.

On the new regions, the nine new regio
ns, obviously we don’t know if it’s going to
be a beauty contest or if it’s going to be a paid auction and obviously it needs to be
a business case per auction
, the business case per auction to see if we’re going to
participate or not
And we would need t
o see the process as well, which is not clear
at all for us.

It could be said, though, that the licences that have

with the auction out it’s
something that is a suggestion from our side.


We have been pushing it but tha
t doesn’t mean that we have to buy everything.

No, exactly.


Okay. And Croatia, you’re absolutely right, we have a slightly damaged brand and
then we’ve had a rocky ride, and we’re not happy with the progress. Seven year
and we still only have a 16%, 17% market share.
As I say, everything is for sale at
the right price. So, I don’t know, I don’t think I can comment more on that. But we
are working with new management there to make sure that we get back on track,
dless of what happens in the future.

And then Norway, on the EBITDA margin, we have increased the guidance and as
we talked about yesterday there is a Christmas season in Norway as well, so I think


that we need to be not overly joyful over the 10% EBITDA

in the third
quarter. We will see more investments going forward in the fourth quarter. So, you
know, that’s why we increased the guidance but we didn’t take the full potential


No, and you talked about what will happen n
ext year. I mean next year we will still
have these MNO agreements with commitments, so you will see the EBITDA
expansion coming in 2040, hopefully.

Very good. Thank you, Thomas. And Operator, can we have another question,


The next question comes from

Mr Terrence Tsui

of Morgan Stanley
. Please go


Yes, thanks very much. I’ve got two questions, please. On the Russian 4G
landscape there has been some speculation in the local press on
ta pote
opening up its LTE network for other operators.

Is that something that Tele2 is
discussing with Yota, and do you think this could be a satisfactory near term
solution, given the uncertainty right now on the timing of tech neutrality?

And secondly
, on Norway regarding regulation, can you remind us again when we
should expect a decision on your appeal against symmetrical NCRs, due to be
implemented at the end of next year, and the arguments that you have put forward
to support that? Thanks very muc


Okay, a question on Yota and a question on Norway on interconnect. We will
start with Yota.


Yota, yes, I mean as you might have read they have opened up to have more
operators. I think up to six operators now in the
Yota network, and we’re obviously
discussing with them. But it needs to be financially viable. It needs to make sense
for us to go in there. So it’s still early days but discussions are ongoing with Yota.

And on the regulatory, maybe, Lars, you can tak
e that?

Yeah, sure, I mean we

the base case is of course that we will have symmetrical
interconnect by the beginning of next year in Norway. We are still arguing for a
prolongation of symmetry when it comes to Norway, and we are bas
ing that on that
would help us building out a more complete network in the Norwegian market. With
the current regulatory glide path we would build around 75% population coverage,
but if we see a prolongation of that asy
metry we could see

high as 90% population coverage as well.

So I hope that answers your question, Terrence.


Thank you.

Thank you. Okay, Operator, could we have the next question, please?


The next question comes from

Mr Pete
r Nielsen

. Please go ahead.



Yes, thank you. Just two questions, please.
The first one relates to a comment by
Lars earlier on, on Swedish mobile revenue growth.
Just to make sure. The
guidance for 3% to 4% service revenue
growth in Sweden, that is reported revenue
growth, yeah, reported service revenue, it’s not some underlying revenue growth?
And the second one relates to Mats’ comments about the Dutch triple play market,
which sort of suggests you’ve given up being compe
titive here, Mats, which I find a
little surprising given where you’re coming from. You have no plans for sort of
upgrading that

the cover network on your video sales side, etc,
to be more
competitive on the triple play market? Thank you.

Okay. Thank you. I would like to start with the first question and, Mats, if you
could take the second question.

When it comes to revenue growth in the Swedish market, we talk about excluding
interconnect in that assumption, and that means that
what we had in the third
quarter with that assumption we grew by 4%, and we included we grew by 2% or a
little more than 2% in revenue.

So, Mats?


On the Dutch side, absolutely. You’re absolutely right we have not given up

by no
means. We

are doing experiments. We’re hoping to see more wholesale

agreements. We will be able to buy fibre to offer then the

or offer the triple play
solutions to our customers, so we have not given up

absolutely not

on the fixed
side in the Netherlands.



Okay. Thank you.

Thank you, Peter. And Operator, can we have the next question, please?


The next question comes from

Mr James Britain

at Nemura
. Please go ahead.


Hi, it’s James from (
). Good morning, guys. I’ve got two questions, please.
On Sweden, can you just give us an update on how LTE is going in terms of
customer ads and whether the customer feedback is that this is now good enough
to substitute fixed broadband for them? A
nd then in Norway could you just clarify
for us what revenue you get from interconnect in that market, so that we can just
assess how important the termination rate decision is for profitability? Thanks.

Yes, I think those are good que
stions, James. I would like to hand them over to


Well, at least the first one, I’ll try. You said customer feedback on LTE. I am not
100% sure how many customers we have on LTE. We’ll see if we can find that out.


Around 80,000.


80,000, 80,000, yeah. And then when it comes to customer feedback, I only hear
positive feedback, maybe just that’s because I'm the CEO of Tele2, but if you look at


myself and what type of solution I have at home, we don’t
have any fixed solutions
at all. I have the home router, and that is backholed through 4G and I have a

solution at home and that is the product that is actually selling the best in Sweden.
It is sort of the
BT home hub but not a fixed backhole. It
’s a 4G backhole. And you
typically get

it’s not
the 4G network that is putting the limitation on capacity, it is
the router. So I get steady 25/27 megabits per second. On my 4G handset I get
various speeds but never lower than 20. I get 30
. H
ere i
n the office in downtown
Stockholm I get 70 or maybe even 80 megabits per second, with a latency of 20
milliseconds or 30 milliseconds.

And then I was trying to say on an earlier question that the experience of going from
3G to 4G is a fairly big jump actu
ally. The 4G experience is a different thing. It is
really truly like turning a page in a book. It is that fast and there is no

completely seamless. So I only hear good feedback from customers and I have an
experience for myself. Yeah.

And when it comes to interconnect we have not disclosed the absolute amount of
revenue that has been derived from interconnect in Norway. What I could say,
though, is that we did have an interconnect c

as of 1 July

and as you can see we
ll did quite well on the margin side. The last cut would then be at the yearend. Of
course it has an impact but once you remember we are working really, really hard
when it comes to realise the synergies between the two companies, and also
moving more vo
lume, as much of a volume as we can towards our own network
when possible. So I think that we will be able to manage that in a good way.




Thanks, James. And Operator, could we have the next question, pleas


The next question comes from

Mr Sasu Ristimaki

of Merrill Lynch
. Please go


Yeah, good morning. I wanted to come back to this issue of mobile data in Russia.
You talk about 5% LTE penetration by 2015, but surely if w
e think of mobile data
revenues as a percentage of ARPU we’re going to be talking about much higher
numbers, and I would like to propose something like 25% to 30%. Now, if your
competitors are going to be looking at replacing voice ARPU with data ARPU, an
you’re stuck in a voice
centric revenue model, how are you going to address this?
And specific to that, if your ARPU actually gets on a negative trend, what strategic
alternatives do you have apart from still talking about this technology neutrality?

, Sasu, those are good questions. Mats, would you like to elaborate?


A very good question but not completely simple to answer. But 5% in 2015, I think
that is the proof of a fairly slow pick up, at least from Swedis
h eyes, and I think it
sort of proves the point that things do not happen overnight in telecom. The world is
changing quickly, for sure, but as consumers we are fairly lazy, within brackets, to
change technology. I think it is more important for us to fo
cus on

as you rightly

ARPU and how we continue to grow that ARPU and the minutes of use. And


I guess that question is: how can you have such a positive trend in Russia? I think
that we have got the recipe right with a transparent approach, good
solid network
and a very, very healthy discount brand name, or discount approach. I think those
things are

will not change, regardless of 2G, 3G and 4G.

Edge, as I said, on our network is growing with 12% but you’re

right the
data growth in

our competitors that have 3G is growing faster, maybe with 20%,
25%. That’s just a fact of life. And tech neutrality will of course mitigate that, but if I
would get a 4G licence tomorrow, and I would start burning a lot of CAPEX, you
would then turn ar
ound and ask me, “Mats, why are you spending all that CAPEX?
There’s not going to be any 4G pickup for years to come”. So I think one needs to
be mindful of the fact that it takes a lot of time and, as I said on a previous question
here, 2G will continue

to grow and our forecast is it will continue to grow another two
to three years. But we might be wrong. It might continue to grow even longer. We
don’t really know that. I don’t think it’s going to stop growing shorter than that. I
don’t think so. T
he importance is to have a
good network
, good solid customer
relations and a good brand name in the market. Then you will be able to handle
quite a lot of disturbances, both on price wars and new technologies.

I don’t know, Lars, maybe you can


No, I think that is a very good answer
. Would you like to follow up on that


No I think that’s fine. Can I just ask a follow up on just CAPEX? If I look at your
overall CAPEX guidance, your comment, it seems that y
ou may be doing a little bit


of a pull back on expenditure

year and I was just curious is that reflecting any

of all overall strategic thinking on CAPEX at the moment or is it just more kind
of opportunistic and timing related things?


I can say it’s the last thing. We can see that we are for different reasons late in
some areas. For example, we talked about Norway where we actually have
planned for this LTE licence as well as

and then some other problems with the
rollout and we

are also somewhat late when it comes to CAPEX in Kazakhstan, for
example. So it’s not sort of that we have said that we should slow down for any
other reasons.


Right. Thank you very much for that.

Operator, can we ha
ve the last question, I think, for today, please?


t question comes from

Mr Henrik Herbst

at Credit Suisse
. Please go ahead.


Yeah, thanks very much. I just want to double check, really, firstly on Russia.
When you’re say
ing you’re focusing on a more balanced approach between
subscriber growth and profitability, is that just for Q4 or is that kind of more

bigger change in strategy?

And then I wanted to follow up on LTE in Sweden as well. Of those 80,000 LTE
s, how many of those are LTE


and if you can give a bit of
colour in terms of what you’re saying in uptake is it accelerating and where are the


customers coming from? Is it Tele2 fixed line customers migrating to mobile only or
are you taking

customers from other fixed line operators? Thanks very much.

Thank you, Henrik, also good questions. When it comes to that I think Mats could
take both of them, please.


At least the first one. The Russia balanced appr
oach, and that is for the fourth
quarter. We need to have split vision, sometimes your foot on the gas and
sometimes foot on the brake, and we’re sort of in between there now.

And then on the LTE Sweden, where they come from, I don’t have that.

Well, the (overspeaking)


as I understand it, the longer

probably not as attractive anymore. We allow tethering on mobile phones as
well, and that’s what people can do.
So when you look at 80,000, that is
antly cut the cord products, which is a very good alternative to your ADSL
VDSL connection, which
has been

quite popular.
Now, having cleared that, we are
assuming a lot of interesting handsets coming in here during Q4 as well

based on
other operating sy
stems than IOS, which could also be pushing the needle but we
see good solid interest for 4G services today

and it’s quite easy to sell those as well
because we can provide such

quality and such high speed on that service as
well. And of course you
get the mobility on top of that, which is excellent.


Mats here. I know there are a lot of Swedes at their summer houses somewhere
out in the

or up north or south

and the home router is a fantastic


product to bring with you to
both enjoy

in the car if you have a battery, and also
when you actually arrive at your summer house. So it is a good product, and as
Lars said easy to sell.

Yes. Thank you very much. I think even though we have a few more quest
ions in
line, we do need to rush to the physical meetings. Of course we would love to
follow up with

who still have questions, so feel free to give me a call at any
time. And just as a reminder, we will release our result for the fourth quarter



Thank you all for participating in today’s
conference call.

Have a great
day. Thank you.


Thank you.