Luxembourg is one of the leading European countries in terms of broadband penetration. The objectives set out in the national strategy far exceed those set by the Digital Agenda for Europe. A fairly strong rise in VoIP/VoBB services made Luxembourg one of the lowest fixed-line densities in Europe. By the end of 2020, Luxembourg was expected to become the first totally fibred country in Europe.
The Internet penetration rate was almost 96% by the end of 2018. Fixed-line teledensity was about 45 per 100 persons, and the nationwide mobile-cellular telephone system was virtually saturated with 134 per 100 mobile-cellular devices. The country’s telecom regulator announced that the auction to allocate 5G-suitable frequencies in the 700MHz and 3600MHz bands in July, 2020.
Luxembourg’s residential and business broadband segment continues to be dominated by the incumbent POST Luxembourg despite market liberalisation in 1998. In recent years the incumbent telco POST Telecom (formerly P&T Luxembourg) has focused investments on cloud and managed services, as well as on bundled packages. The company offers a 100Mb/s service nationally, while its 1Gb/s service has been progressing following the government’s directive to provide a 1Gb/s service to all citizens by the end of 2020.
Luxembourg has a small, stable, high-income economy has historically featured solid growth, low inflation, and low unemployment. Despite its small landmass and small population, Luxembourg is the fifth-wealthiest country in the world when measured on a gross domestic product (PPP) per capita basis. Luxembourg has one of the highest current account surpluses as a share of GDP in the euro zone, and it maintains a healthy budgetary position, with a 2017 surplus of 0.5% of GDP, and the lowest public debt level in the region. The economy has evolved and flourished, posting strong GDP growth of 3.4% in 2017, far outpacing the European average of 1.8%.
Luxembourg remains a financial powerhouse – the financial sector accounts for more than 35% of GDP – because of the exponential growth of the investment fund sector in the 1990s. Nevertheless, Luxembourg has lost some of its advantage as a favorable tax location because of OECD and EU pressure, as well as the “LuxLeaks” scandal, which revealed advantageous tax treatments offered to foreign corporations.
Founded in 1848, POST Luxembourg is the number one telecom operator in Luxembourg. A financially sound and stable company, POST Luxembourg has no debt and is profitable. Despite fierce competition, it managed to remain the operator with the biggest market share for the various Telecommunication services. POST Luxembourg’s market share in Internet services is over 70%. In fixed voice services, the company has a market share of 85% and a population coverage of nearly 100%. In GSM, it has a market share of nearly 60%.