Good morning everyone, welcome to Telia's Capital Markets Day for 2019. Most of you know me, I guess. My name is Andreas Joelsson. I'm heading the Investor Relations department here at Telia. With me as moderator today, we have our new and of course, improved, right Peter? Head of Communication, Åsa Jamal. Welcome to you as well.
Hello. Thank you. Really nice to be here. You just saw some images of what we're actually doing in our business, and today we will also have the opportunity to visit the Connected Business event because we're just a kid sister event of a larger thing going on upstairs, and you will be able to see the exhibition afterwards if you're interested, right?
This is the agenda for the day. It's half a day. We start with our CEO and President, Johan Dennelind, going through the group strategy, and then other members of the group management will follow. We will have a Q&A, and then the country CEOs of the three biggest countries will follow after that. We will have plenty of time for Q&A, and we will end at approximately 12:30 P.M.
Exactly. You will be able to join the exhibition, where we have almost 1,000 customers here right now looking into what digitalization can actually bring to society. I think we're all eager to get started, right? Because of that, we ask Johan Dennelind, our CEO. Welcome on stage.
Thank you very much. Thank you, Åsa and Andreas. You don't have to leave the stage, but it's fine. There's plenty of space here. Anyone wants to join the discussion later, you're also free to come up. Great to see you here. I know some of you have traveled far to join us, and we really appreciate that. We see a lot of you out there during the quarterly results, but then we only have one hour, then we only have me and Christian. I guess you are getting tired of us sometimes. Here we have a large part of my team, and also the team that are not on stage who is also here and mingle around in the breaks. I'm going to kick off, we are looking forward to Q&A later.
We are in a changing world, a lot of the times we end up talking short-term. Short-term numbers, how was the quarter? This day is a lot about lifting also into the future, looking into the future somewhat. We see, actually now we're at the doorstep of the next wave of opportunities/growth. You could say there's a lot of risk in here, but we have chosen to see the next wave as opportunities and growth. It's not small. It's actually some mega trends that are shaping societies, enterprises, and the consumer behaviors. We think we have the strategy, and we'll tell you that, to deal with this next wave of growth. Just to give a couple of examples, digital societies is a massive thing going on right now. Smart cities being shaped.
The data needed to shape those cities smartly, securely, efficiently is happening a lot. In our footprints, and I'll come to that. We have increasingly demanding consumers on different types of devices, demanding different type of quality and speed, but also security and trust coming out as a strong mega trend, of course, and will be, I think, a prerequisite and a determinator for success in the future. We're also poised to take on that. You have maybe the biggest change we're seeing entering into next wave of growth is also what we have in the afternoon, Connect to Business. The enterprises are digitalizing as we speak. The way they are doing that is also expanding business models, entering into new areas and their adjacencies. Innovation and automation in the B2B space is tremendous.
That's also, by the way, where we see the first big demands on 5G coming through, which we'll also take you through today. These are exciting times. Most importantly, I think we also have an opportunity now to really position this industry as a key driver for digitalization and for sustainability. That has been something I feel over the years, I think we've spoken about that sometimes in our meetings, that we're not getting fully recognized for in Brussels, for example. We are as an industry, in some of our markets, we are as an industry not really taken all the way so seriously that I think we could be, and a catalyst for change that I think we are. That one may now really come through. 4% of GDP contribution across Europe from our industry. It is something we should capitalize on.
I'm an optimist, and I think we, done right, have really exciting times as we're now moving into the next wave of growth. That's the start to put a bit of optimism into the room. I know there's a lot of cynicism and skepticism around our industry, but we are here to fight that and prove you wrong. We have done a lot over the last few years, as you know. When we summarize this, we have actually divested some assets, around SEK 50 billion, and we have bought assets around SEK 40 billion. It's a real repositioning of a company that was in 19 countries directly and indirectly to now focusing solely on a region with seven countries. Yes, we are still in Turkcell, and yes, we have Moldcell in our family, but the main focus is in the Nordic Baltics.
This region is a truly exciting region for many reasons. 33 million people, not small. That economy itself places very high on rankings as an economic zone, as you know. We have pretty good growth in the region economically. The GDP, 2%-3%, if you take it across our markets. Maybe more importantly for future growth is the digitalization that we have in the region, measured different ways. This measures IoT connections per capita, which is way above the average in the EU zone, as well as the scores on ESG. These regions come out very high. We tick that off, and we say, "Yes, that's good." What I pointed to earlier, I think these are really fundamental pillars for growth in economies and therefore also in our industry going forward. This one you don't have to know by heart.
This is our strategy summarized in one page, and it's in your handouts. Everything we do in this company should be relating to this one-pager. It's a way for us to focus our initiatives, it's also something we measure. In all these boxes, we have KPIs. Some of the key important ones, we also have incentives tied to it. The reason I'm bringing this up now is that today we will talk mostly about a couple of these boxes. One is in the mass market side, where we are the hub to the digital experience, is in home and offices. Convergence, we call it. Also the digitalization of choice for enterprises, also convergence in B2B.
We're going to tell you quite a lot of new things around the way we operate, our operating model, which is about rebuilding our factory to reach cost leadership through synergies and scale. These are the four main boxes and of course, riding on the network, and the best experience across platforms. This one, when you want to know our strategy, you can go back to and see if we're sticking to this. We will come back to this as we go through the day. Our brand, Telia brand, is now in six markets, the major brand. A couple of years ago, we only had Telia in Sweden and Denmark. We've been on a rebranding journey on our main brands, a successful rebranding journey, and you will hear from some of those cases later today.
We have a Telia brand platform where we are really zooming in on our core propositions, taking that out consistently across our markets. Giving you the best network experience is a true pillar that should be seen and felt out in our customer engagements. Putting your interest first, regardless if you're a business customer or consumer, and that increasingly is about trust and building that trusted and loved brand, and really important. Being your hub to digital experiences is truly something that enterprises starting to appreciate in an era where there's a lot going on in the IT and digitalization space. As a fundament, and you'll hear about this today, having a positive impact on society should also be seen and felt in our brand. They go together. You will see what we mean with that.
All of this we have done over the years is starting now to pay off in our measurements in our markets. These are NPS numbers that have increased in all our markets over the last two years. An important measure, not the only one, but one important measure that we have showing that our customers are promoting us more than they did a couple of years ago. Truly important for loyalty, ARPU, and churn. I'll come back to that soon. Convergence. We talk lots about convergence internally with our customers, but also with you externally. What do we mean with convergence? I have tried to paint a picture in your head sometimes about the approach we have to convergence. Look at this as a pyramid where at the top of the pyramid you have promoters, we call them.
People that are actually prepared to take up another service from Telia and pay for it nominal value, i.e., the price that we pay standalone. They pay for that service to get onto their second or third service with Telia. They may even pay a premium to get that one-stop seamless brand experience and delivery. Those are true promoters. They don't need incentives. They don't need discount. They just need simplicity. They will be happy to pay even a bit more for that. Great people, great customers. We love them. We have what we call incentive seekers. They need some type of incentives to join a second, third service or product from Telia. We're happy to give them that. We do.
It could be more for more, things that don't cost us much, i.e., some top-ups of value-added services. You get a core service paid fully for. You have discount seekers that need, you pay for two, you get three type of offer. Our approach to convergence in all our markets is in the first and the second tier from the top. We have not gone down on discount seekers, i.e., we don't force out discounts to drive one KPI of we want as many people on our conversion offer as possible as soon as possible. That we don't do because that is eroding the profit pool in the respective markets. We're taking it step by step. You'll see some examples from our markets today on how we're doing on convergence. Let me take a couple of examples on convergence.
Countries that are not exposed on stage today, but are doing really well in this space, I turn to Estonia and Lithuania. Estonia, which is then on this left-hand side, the NPS has The average B2C NPS, so consumer NPS, is around 19. If you take up another service, the NPS is about 50% higher. It goes to 30. ARPA, average revenue per account, is then up with about EUR 15 . Churn goes down, surprise. If you are converged, you have as low as 4% churn in Estonia. Super clear example on how we want our convergence to develop and how we are driving this through our markets. Of course, Estonia is part of Telia, and we take all the learnings we have here into our respective markets, and we fine-tune for the local adaption.
To the right, we have a similar example in the Telia one offer. When you take up another service, you have an ARPU uplift of 5 EUR. Also here we see our penetration on mobile increasing in the broadband penetration. We are slightly lower on market share in the mobile side, very strong on broadband, using that base to step-by-step increase penetration on more services. These are good examples, and you will see some more as we go through the markets today. The next step in convergence, we have talked about this, we are entering into the content space. We are already in content space today. We have made a bet in Finland. You will hear about that from Stein-Erik in a bit. Then we also have a big content play on the table in Brussels, the acquisition of Bonnier.
The core purpose of us entering into this space is about enhancing the customer experience with some unique type of offerings that we could not do without this content in-house. It is also to secure the content that we want to have for our customers now and in the future. It is also about monetizing that video explosion that is happening in the market with a stronger presence and insights of how content is used and consumed by our customers. Of course, we are by entering in here also part of a reshaping media value chain, which is then a global and local dynamics that we are today somewhat watching from the outside. By being here, we have more currencies in our negotiations with content owners, which today is a pretty hopeless activity to undertake.
That is Bonnier, and I will come back to Bonnier standalone and the synergies a bit later. Let me first go through the convergence around B2B. Here we have talked you through over the years a strategy of going from just connectivity, SIM cards, fiber to enterprises, data comm, and et cetera, into something that creates a broader offering, a broader value proposition to enterprises, and that is the core upstairs today in Connected Business. By doing so, we are taking a stronger part of the customer daily life, increasing loyalty if we do things right, and increasing the opportunity to be part of that growth of ICT, which is the real growing part of the enterprise market. The connectivity piece is not a growing part. If we are only in the connectivity, we will be in a slight declining market with heavy price pressure.
Moving into the ICT, we have more services, better shield on core, but we are also part of a revenue growth in ICT. This we have executed very well on across our footprints, especially in Finland, as Stein-Erik will take you through that as well. Let's just look at 5G, a current topic. I will be the only initiating the topic because Magnus Zetterberg will speak more insightfully on the 5G side. We had a talk about 5G six years ago. How should we take on 5G? We said we should learn from 2G to 3G to 4G, and we should again, not get this wrong. We are really trying to get 5G right. Our approach has been simple. We want to be as early as possible in all our markets. We want to be out with early pilots, commercial trials, customer cases as soon as possible.
We want to get the required spectrum as soon as possible. We want to bring in the right devices as soon as possible, and try out this in different verticals. So we are. We are very early out, first in most markets in trying this out. Most happens to be enterprise and business-to-business cases, and we'll see some of those later. Here just a few of them where my earlier point to businesses really want to get out there and understand 5G, use 5G for their own good, developing their business to something that is more competitive. I'm amazed on the innovation drive and the hunger for change that our partners and customers here are having.
They're also, by the way, paying for this already, which really tells me that something is new about this technology shift versus the old technology shifts. Th is is driven by real needs, which have not been able to be met before by technology. You go into the characteristics of 5G with the latency, the stability, the capacity, the dynamic aspects of planning and creating your own private secure networks. These are really key features for enterprises. When it comes to the consumer market, that is a scale game that will come in the future. There, your guess is probably as good as ours, and we have an approach that Magnus will briefly talk to you about in a while.
We shaped something called Telia Global from January 1st, where we realized we have a lot of assets that are in the global space and more so than our domestic businesses. We have our global carrier. Telia Carrier is the leading internet carrier in the world. We carry most internet traffic bits and bytes than any other carrier, which means we are really part of the core internet, and a lot of insights from that, but also a lot of reach from that to our multinational customers.
Our multinational customers in this region are very global and very international. That combination is obvious, and as one example you see to the left is really when the retail B2B operations in the countries really use the carrier proposition, it works. They sell them more carrier service. In this case, in Finland, where we have been really good focusing on the carrier, bringing that into KONE, for instance, in their global needs of communication. If you just get Sweden to the same potential, that's a lot of money. Division X is our IoT big bet, mostly IoT in there.
Where we are, double-digit growth is not so impressive from low levels, but we're still. We're at SEK 1 billion now of revenues in IoT and growing 20%. I think we definitely can do more and better than that. We see, as I mentioned on the first slide, a lot of focus and needs coming up in the new era. We have our various other surrounding bets that we're working on for growth and innovation in health, in crowd insights. Very exciting part of our business where we are launching one service today in the Connected Business around city vitality insights and index, where we're helping cities to use data from our mobile networks to plan cities and improve efficiencies for smart cities.
These are a very important part of the future of Telia, and we expect them also to contribute on EBITDA with more than SEK 200 million coming into 2022 as an incremental EBITDA from where they are today. We talk about sustainability a lot in this company. We have integrated it into our strategy. You probably saw that if you were quick on the strategy slide. It is embedded in the way we work and in the way we drive our business. We're working on many of the SDGs, more close to us than others. Now today, we're also taking the next step into the SDG number 13, climate action. I think that's an area we just simply have to do more, and we can do more.
Cecilia will talk to you about how we intend to make ourselves and our partners more environmental friendly and reach zero CO2 emission. That's a pretty daring thing, which you will hear from soon. On the note of efficiencies, we have different type of efficiencies and cost savings in our group, ongoing and launched also here today. How we would like you to look at us in terms of efficiencies, there are some costs that will increase, both for natural inflation reasons, but also for our growth agenda. We have not given up on growth. We're investing heavily for growth and fighting to get back to service revenue growth across our markets organically. That will drive costs, especially if we succeed with finding those growth steps that will come with Cost of Goods Sold, for instance.
That one we just put aside and say we do accept an increase there if we grow. On the more OpEx and CapEx side, there's a lot in there that we're driving for efficiencies. The structural cost and CapEx savings are in three big buckets. One is the M&A synergies, which I'll talk to you soon about. The second big one that we're talking to you about today is the new operating model. Big potential savings coming in, or committed savings coming in over the next few years. Our various transformation programs across our markets, and the one we have been speaking mostly about is the Swedish E2E Mass Market transformation that you'll hear more about today as well. These are structural things. They take time. They don't come easy.
We got to have patience to make sure they come up. We commit to them, and we go in with determination to deliver. We have more general cost reductions that can be executed all the time. A new cost program for this year, next year, so forth, in the countries and on group level. We can bucket them in more general terms, but also in operational excellence, really driving out through a smarter, better way of working through automation, we can get much more efficient in the way we work, and that is with lower cost base. We have commercial excellence, where we're focusing heavily now using our data analytics to become smarter in our commercial execution, which then, in your world, results in lower SARC, lower SAC, and becoming more bang for the buck.
That's a commercial excellence agenda spreading across as well structurally in our markets. Of course, our sourcing excellence, where we're using our scale across our markets, where we have come a long way in coordinating ourselves better, getting into strategic partnership with vendors, taking common risk across our footprints, and seeing the effects of that on CapEx efficiencies step by step. Of course, you add to this working capital, which we will have a special section with Christian later today, and I won't even try to go in and copy that. This all results in what we're taking out today, a 2% OpEx reduction program over the next three years across the group, and we'll take you through those as well. CapEx efficiencies are coming market by market, but also group-wise, and that's a lot related to the way we execute from the new operating model.
The CapEx we are freeing up here will either be seen going forward as CapEx savings in absolute terms or reallocated into growth initiatives or new technologies. Talking a bit about our acquisitions. We launched the acquisition last summer of the GET TDC company in Norway. We are very happy with that acquisition. We are now, you will hear from Abraham, executing on the integration. We are one company already. We rebranded a part of the business already, so full steam ahead. We're very happy with what we're seeing. Based on what we're seeing already now, we are upping our synergies from this deal to NOK 800 million in the full run rate, and we'll talk you through that as well. Before it was NOK 700 million. We've taken it up NOK 100 million, and as we know more, we will update you more. This is good.
It's on track. It's very positive, and we're happy with what we have in place. Bonnier Broadcasting. Bonnier, as you know, is in the process of being approved in Brussels. We have filed last Friday. I'm sure you noted that. We are then in a phase where we can't do much together. We are very much looking into Bonnier Broadcasting from the outside. Let's take a few things. These are official numbers reported and also some official stats coming from third parties. What this tells you and us is that, first of all, the market share from TV4 Group in the segment 15 to 64 in Sweden is growing, both as a group but also as TV4 standalone channel. That is impressive in a world of competition where TV4 has been outperforming competitors over the year. They continue to outperform on market share.
If you look at the AVOD, that's on linear. On the AVOD side, advertising video on demand, we see that TV4 is actually having market share more than the combined 3 competitors together, the nearest competitors together. Very, very strong position in AVOD. Thirdly, the reach that Bonnier Broadcasting have with TV4 Group has also increased in spite the fact that linear TV is decreasing in reach. That means that the AVOD side and the OTT side is more than compensating for the reach to overall increase the reach of TV4. Very, very strong fundamentals from Bonnier Broadcasting. Strong fundamentals, of course, lead to strong financials in this case. We saw beforehand when we took this deal out, we reported you a pro forma expected on a 12 months rolling.
We have now the reported numbers, which for 2018 was a SEK 8.3 billion revenue operations with SEK 1 billion EBITDA. That is some measure that we're also introducing for you. We will get back to our ways of reporting that when the acquisition is approved. It's a SEK 1 billion EBITDA. Assuming there is no CapEx in there, it's a SEK 1 billion cash flow in the definition of EBITDA -CapEx. The real underlying change that you already have spotted on this one, of course, is TV4 trading a lot better, upping their EBITDA from SEK 1 billion to SEK 1.4 billion. The one I am mostly impressed with and happy with is the turnaround in C More that we talked about. You saw SEK 0.4 billion negative in 2017, you now see SEK -0.1 billion in C More, and it's turning.
We told you it's turning, and we see now also when we have the number that it has turned, and it continues to perform well. Why is that so important? Well, back to the linear TV, moving over to OTT. The total TV concept that TV4 and Bonnier has in place has been very successful. At the time of announcement, we had a multiple of 15.3, excluding synergies, with a reported number that is now 9.2 multiple, excluding synergies. If you are interested in the including synergy number, it's now down to below six, when we have executed full run rate synergies. Financially, this has become a more attractive acquisition than at the time of the takeout. We have no reasons whatsoever to see that our synergies that we've put out of SEK 600 million in total has changed.
That one we have not been able to revise or re-look because we're not in the company yet, as you know. With these two acquisitions, we have a stronger Telia Company emerging. These of course are pro forma numbers, simplified to show you that the standalone GET TDC, the standalone Bonnier Broadcasting with the full run rate synergies of EBITDA, but also the EBITDA - CapEx, will give you and us a SEK 4.2 billion pro forma improved EBITDA and a SEK 3.3 billion EBITDA - CapEx pro forma addition to our cash flow. You have to add minus tax and so forth and working capital. That one we will come back to you when we know more from the inside of Bonnier. Very, very positive and optimistic about the two big deals we have on the table.
Coming towards the end, how should you view us over the years to come? When you now look through my team's presentations, we are really fighting to get back to growth across the board through convergence, through our smart pricing based on data analytics, and through Telia Global supporting both core, but entering into new growth areas. This is a strong commitment we have, a fight for growth. We have not given up on growth. Given also the industry outlook and the importance of our digitalization journey, I really believe that we will. We have our push for efficiencies across our markets, and you'll see in the structural cost reductions that we have and the more focus on smart cost takeout, operational efficiency, commercial efficiency. We have 2% OpEx net reductions over the three years to come.
The execution of the M&A, it's not just bringing in the companies and then out come synergies. Of course, this is extremely hard work that we need to deliver on and be smart about, but we really believe that the synergy takeout is very much on track and upped in Norway. We also believe, of course, this has great opportunities in the customer proposition side running into further in the future. Our wise investments using our scale is something you'll see more about today. Coming back to our best-in-class cash management, which we were definitely not a couple of years ago. Through Christian and the teams, we have really worked our way into parity in cash management on peers, but we want to be best in class. All of this together gives us strong comfort that we can sustain and grow our cash flow into the years to come.
Today, this year, SEK 12 billion to SEK 12 and a half billion, regardless of Q1, as we talked to you about today in the press release. We say it's down. We told you it was going to be down Q1, and Q2 is softer. Second half of the year is stronger, and we have no reasons to change our cash flow guidance of SEK 12 billion to SEK 12.5 billion. Here we also say beyond 2019, it will sustain and grow. We have a strong agenda, and we're very geared up for execution, and we're keen to hear your feedback on this later on. I will stop here, and I don't know what to do now, but I'm sure I will be guided by our eminent hosts here.
As always.
Thank you. Where should I be?
You should have a seat over here.
Thank you.
Keeping track of your team.
Okay.
I will invite our Head of Group People and Brand, and also newly awarded the HR Manager of the year, Cecilia Lundin, that will take us through the next presentation.
Thank you, Andreas. Did you know that our industry was the first industry to endorse and commit to the SDGs in 2016? At Telia Company, we have been creating and driving a business-integrated sustainability agenda longer than that. I am very proud of being the one presenting to you the sustainability update today, including the next steps on our way forward. If you look at our sustainability strategy, digital impact is the core of how we create value to society and to our stakeholders. Digital impact, it is about the broad impact that we have through digitalization. It covers all stakeholders. If we start with the customers, we know that consumers today, our business consumer customers, they request us to be responsible and to integrate sustainability in the way we drive business.
Through us doing that, we also help them having a positive impact, reducing their emissions through how we develop our products and services. That is a key thing, and that is a driver for brand loyalty, and it's of course also giving us the opportunity to increase the price premium on our products. If we look into the B2B area, there we are already today generating business through the sustainability that we have. As being referred to earlier in the presentations, we have today a big event here, where we have invited almost 1,000 business to business customers, and where the main theme on the agenda is how to drive sustainable business, exciting and creating engagement. To be mentioned, I think it is also worthwhile that last year our B2B business was ranked as number one in our industry in Sweden among our B2B customers.
That was in the Sustainable Brand Index, which is an index that we think is very important to look into for all our markets and to follow because that shows that we deliver value and the value that we aim to create. Employees, our current employees and our future employees are also very important stakeholders to us in this. I think we all know that the younger generations, one of their main criteria when selecting an employer is the approach that that company has to sustainability and the responsibility that we take, being driven from the willingness to, by being part of an employer or a company, you are able to have a broader impact through that context. That puts, of course, requirements on us in how we drive sustainability and how we involve our employees in that context.
In the war for talent, while we are competing for the same type of competencies as everyone else, this is a critical competitive advantage for us. We have more than 30,000 suppliers today. How we work with sustainability together with them is, of course, a critical value generator also. All these dimensions together drive shareholder value in the end. This is the view of the stakeholder approach that we are taking to sustainability. If we go back to customers once again, I would like to give you an example where we see that the way we integrate sustainability into our business and how we run business drives value both for our customers and for the society. This is an example from Finland.
We have the Helsinki regional traffic that, based on the anonymized and analyzed data from our networks, where we could provide crowd insights to their work, the city planners and the public transport operators were able to design an optimal situation for public transport based on the knowledge on how people are commuting, at what time of the day, et cetera. Based on those patterns, creating the most optimal traffic situation. That actually reduced the car traffic with 8% during a measurement period. Us having impact on customer value and at the same time having impact on the society, impacting two of the SDGs through our work. This is a replicable and scalable solution. We have many more cities looking into working with us in the same way going forward. A true business generator.
There are more examples, of course, to come, my CEO colleagues will give more examples in their presentations later. If we go back in time, six years from now, we were actually a company in crisis. We took those learnings from that crisis, as we have gone along, that has been embedded into our creation of a responsible business platform and the way that we conduct an ethics and compliance-driven operation. That also gave us the opportunity to take the next step and to integrate sustainability into the business strategy and the way we operate. We are also very proud to say that we were the second company in the world to issue the statement of materiality, describing how we will work with our stakeholders on all material aspects of our business, with both risks and opportunities to drive value.
That sets a very high standard for us, it also assures that we, at every point of time, run our business and our operations in a responsible and sustainable way. A very important milestone for us going forward. Another thing that I would like to lift up for you, that is how we have embedded sustainability in the way we drive engagement in our company. We are a true believer that engagement creates performance, which makes this very worthwhile to focus on. As an employee in our company, if you have the opportunity to have impact, not only on your own situation, but also broader to the society by being a Telia employee, that is driving engagement, and that is a lever for engagement.
We have worked on building a platform for that, where our employees can actually themselves contribute with digital impact to all our stakeholders in the platform of YOUNITE, which is a volunteering work that we are very proud of today. Johan also showed you an extract from our brand and our brand platform. Last year we added the sustainability component to the brand platform as a natural step for us because we have then been working thoroughly inside out with creating a foundation that we now want to mirror on the external side. That is how we do things. We work genuine and transparent inside and out. It's a natural thing to have all those connected together.
Now we are taking the next step because we see that with a sense of urgency that we have in the society, we need to step up and that's why we're taking out the daring goals in a way that we see will have us also leading the way going forward. When we look into the daring goals, it is actually really upping the game. They are inspirational, they are ambitious, and they are long-term. They are daring not only in content, but actually also in the approach. Because we are not setting out a detailed plan year after year until 2030. The sense of urgency is so much stronger than that. We cannot afford spending time on working with detailed plans for an 11-year period.
We are setting plans for the nearest years, and we are having the ambition in front of us and all our stakeholders as a guiding star. Looking into the goals as such, zero CO2 for our own operations, that is daring. Zero CO2 for the whole value chain, that is massively daring, and that is what we aim for. Including our customers and our suppliers into this setup of reaching zero CO2. When it comes to zero waste, we are aiming for all waste. That means that we need to have a business model that drives the circular economy fully, because we aim for full circularity by 2030.
100% action, that is about our people of Telia, the people that we are so passionate about and where we know that activating them fully in the daring goal setup in the same way as we have done in the sustainability agenda so far, that is a value creator, and that is a value creator that we want to build on going forward. Taking you into an overview and some highlights on the way to get to 2030, I would like to start with saying that we are also doing good today. A few examples are that we have a buyback program for mobile in all our markets. When you look at 2018, we actually reused and resold 42 tons of network equipment. There are a few examples of things that we are doing already today. With the daring goals, we are stepping up the game.
When it comes to CO2, you look at us as a company, we are on 93% renewable energy today, we aim for getting to 100% through creating efficiencies and through also working with building up our own renewable energy, such as wind power, et cetera. When it comes to the customers, of course, as I said before, here we have a role to play because how we design our products and services in a way that have them reducing their CO2 emissions, that is the way we create value together with our customers. For the supplier base, we aim for a zero CO2 supplier base in 2030. That is a massive statement, and I will come back to that. The waste target, there we talk about all types of waste.
We talk about construction waste, we talk about office waste, we talk about e-waste, and we talk about digital waste. Digital waste is not mobile phones. Digital waste, it's spam, it's old data, and it's unused capacity in the networks, to mention a few examples. Just to give you a feeling for the dimension that is in working with digital waste. If you took every single individual in France and you had them delete 50 emails each, then that would correspond to an energy consumption decrease equivalent to turning off the lights in the Eiffel Tower for 42 years. That gives you a feeling of not only what we could do as a company in our industry, but also actually what we could do each and every one of us as individuals to make an impact.
Because digital waste from a company perspective is waste, but from a society perspective, it's CO2. That's an exciting area. We are setting up our digital waste strategy now, and we aim to have it ready by 2020. It's a big piece of work, and it's, of course, supposed to take us to a stage where we are utilizing our networks in the very best and optimized way. Another aspect of digital waste is how we design our products and services, where the environmental-based design is what we are working with to strive for, as I said before, the full circularity by 2030. The 100% action area. Well, there we are on a very good level, I would say already, with the engagement platform that we have where we already activate our employees in the work with digital impact.
This is something that creates pride in our company, we see that in our employee surveys, where our people score very high, both on the attraction in our sustainability agenda and the importance for them of having impact through that. Us adding on the daring goals in that context will be very natural, and there it's both about training, informing, showing the impact that we have in society from our products and services, but also have our employees utilizing that knowledge broader outside the company, helping us to spread the word. The digital waste example is a brilliant one, where you could actually engage people with small things. Those are some of the steps that we see in front of us. As I said, I will not share more details than that. We are creating as we go along.
An important dimension of how we have taken on the Daring Goals is the sense of urgency-driven approach. We don't see that we can start building from inside out only, cleaning our own house. That will not make it. That's why we are taking the grip on the whole ecosystem. We will pick and prioritize those items that have the biggest impact, and those are the ones that we will do first. That requires that we integrate the work together with our customers and together with our suppliers. Through working with them, we will also have impact on the indirect stakeholders. As you see in the slide here, of course, the value creation as well as the complexity is increasing in that context.
Going back to the suppliers, as I said, here we are raising the bar because we see a big impact coming from working in a much better way with them from a sustainability perspective. We aim for a zero CO2 supplier base in 2030, starting in 2019, with having CO2 emissions as a selection criteria when we are deciding upon suppliers. Putting a requirement that by 2022, we want all our suppliers to have a plan for how they are going to be zero CO2 in 2030, including their suppliers. That is bold. Of course, that is something that we need to do together. Today, as we speak, we are sending out a letter to our suppliers, inviting them on this journey, inviting them on delivering upon the Daring Goals together with us.
We know that we have excellent suppliers that we are working with already today, who also have excellent thoughts in this area. Together, driving this, we can deliver value, and we can achieve so much more. This is what we are going out with today, and the journey is starting fully as we speak. The Daring Goals are creating shareholder value. Our customers and our employees are requesting us to be responsible and to take on a responsible work in this area, creating customer loyalty, creating value, and therefore it is a true business generator for us focusing on it. At the same time, we know that this will support our cash flow and our TSR going forward, and we are also committed to stay within the cash flow target for 2019 while doing this work.
To sum up on the Daring Goals, today we are publicly committing to them. We are committing to the Daring Goals not only for ourselves, but for driving it through our ecosystem, because we see that there is a need for a transformative change here. We are confident that through the journey that we have been on as a company and that we are currently on, and through the trust that we have in our people, in our partners, in our innovation agenda, and in our ability to utilize the technology development, we will succeed and deliver on this.
It's not a project. It's about accountability, and it's about continuity. We will report to you on a quarterly basis in the same way as we do with other material aspects of our business, how we progress in this area. We are absolutely sure that working with the daring goals, as well as the rest of our sustainability agenda, is today and will tomorrow create even more value for the business, our customers, the society, and our shareholders. Thank you.
Cecilia, as you say, we are all very committed in the management team to embark on this journey going forward. We have been looking into a little bit about our strategy, our ambitions going forward, of course, it is also about getting things done and to go a little bit deeper into how we get things done in Telia, we have a new member in our team here to present to you. He is an experienced change leader with a background from Telenor in Norway, where he was the CTO. With us, he is the COO and head of a new unit called Common Products and Services. Magnus Zetterberg, welcome on stage
Isn't that nice? When something should get done, they call for me. That's perfect. I like that. I will talk you through two topics that I really burn for. First, our operating model, our view on 5G. Why a new operating model? If we look at Telia Company today, we have overlapping product development. We normally, when we launch a product, we develop it in each country. We develop equally many times as we have countries. We have very much local processes and denominations in our processes, meaning that we speak from a process point of view, very different languages. We have an old way of developing, doing a release-based product model, project model. We have also very unique architecture and technology in our different IT stacks. With that as a starting point, we will now start to deploy a new operating model.
Telia has been very good over the last years to actually develop certain common functions. We have today an operation unit, which delivers operation and operate the network across our footprint. All our six operations are handled and managed from one NOC service center. We have also a number of common platforms in the core network and in messaging, which is developed once and delivered six times. What we will do now is to enhance that delivery model to move the products and services part of the countries into a common function. We will divide this into a number of product areas. One is connectivity is our base services, like voice, like data, the fundament in what we are doing. One is communication, which is our B2B services, we already today have a contact center solution called ACE.
It will be mentioned later on when the countries talk, which is developed once and delivered across our footprint. We've done great successes with that product, both in Sweden, where we have very huge market share, but we have also done successes in Denmark and Norway and Finland. Developed once and deployed many times. We have a media and entertainment product area, which has started and developed over the last year. Most of our media offerings today are developed once and delivered in more countries than one. Then we have started up a product area called IT Services, which is focusing on our ICT offering. You will see in the presentations from the countries that we have data center assets, which we can utilize across our footprint. We have a number of competencies in this area, which we can deliver across our footprint.
Underlying that, we also combined our IT organization into one unit, that means that we have one IT factory for all our deliveries. Leaving the customer-facing units then to focus on what matters most for our customers, the customer itself, and leaving the process and development effort into a common function. This means that we will create scale, and it means that we will create efficiencies. Develop once, deliver many times. The customer-facing units and the business rationale for this is to be less focused on processes and development, and extreme focus on the customers. With relevance and customer agility, focus on what is best in the market and how do we approach the customers. Meanwhile, the common functions will focus on the platform efficiency and creating relevant and competitive modular products that the customer-facing units could combine.
How we go about this then is that we will, first of all, when we onboard the countries into this new operating model, create synergies, meaning that we have overlapping efforts, which we take out synergies from. Sweden is now onboarding into this model, and we have a roadmap for onboarding the remaining countries. We will focus on harmonizing the processes across our operations and the denominations. We will focus very hard on enterprise architecture, meaning that we will create one delivery chain, IT factory, across our footprint. There's been previously talks about modernization projects or transformation projects. These assets developed will now be utilized across our footprint. So efforts done in the Swedish operations will be used in the Finnish operation, and efforts done in transformation in Finland will be used in Norway, and so forth.
That means that we will reduce the needed effort in developing for the future. We will reuse assets. We will also change the way we develop from the traditional project model into agile ways with a combined effort. We will deliver products which are modular, and which then the countries can combine to create the most competitive offerings for their markets. The first part is the short-term gains, and the middle part is the ones that require some more effort and will develop over a bit of time. Looking into this, of course, the new way of working will create agility and common. One common effort much stronger than a fragmented effort. Of course, that will enable earlier launches of new technology for our customers, and also create more competitive products in all our markets.
Today, we don't have the same capabilities to deliver the same products in all markets. We will develop ones, which means that we can deploy it across the markets. When we look at this, we will create efficiencies from the organization, from the way of working, from the products and processes, system and process, and suppliers. By consolidating the IT infrastructure, we will have fewer variants. We will, of course, also have fewer vendors into this. Our estimate is that you will see these savings taking off from 2022, and we will have a run rate, saving SEK 0.6 billion-SEK 0.9 billion as a run rate cost figure. On top of that, we will also create efficiencies in the investments since we invest once, and that cater for another SEK 0.5 billion in CapEx reductions. That is the operating model.
When it comes to 5G, we have been very successful during 2018 with contracts and pilots. You will see when the country presents a number of examples from different industries. There has been a great pull, especially from the academia and the different industries around 5G. We have deployed in pilots of different flavors into most of the industries: manufacturing, process industry, mining, logistics, and so forth. There is a great interest in 5G due to the 5G technology will enable efficiencies in the different customers' processes and work. We have started a big amount of partner programs to develop these new technologies together. If 2018 was the year of pilots and trials and testing with pre-commercial technology, 2019 will be the pre-5G era as we see it. I would like to introduce a term to you, which is 5G non-standalone.
That is what will be delivered from the industry this year. A 5G non-standalone means that the terminals need a 4G network to send its signaling through. To illustrate what that means is that because there's a lot of talk in the industry of should we do 5G on low band, the 700 band, which creates very big coverage areas, or shall we use the high bands, which it's originally designed for? Just to illustrate the challenge with 5G non-standalone, that is that if you put the base station out there and you imagine that if you take it on the low band, you will create cells in 5G that covers an area of a football field, as an illustration. You need to anchor the signaling into 4G.
If you do that, you need to have a high band on 4G, and that is as big as the middle circle on the football field. You create a lot of areas around that middle circles where you cannot use the 5G coverage enabled by low band. The 5G non-standalone will set some limitations into 5G for 2019. On top of that, right now the industry is doing the last phases of interoperability testing, meaning that the chipset manufacturers are testing how it works together with the infrastructure. When that is done, the implementation of the chipsets into the terminals will take place. The industry plan to have this ready for the 5G non-standalone by the mid of this year, and it will of course be the first generation of 5G equipment and systems. It will be available in quite low volumes.
For us, we see that 2019 is the year when 5G will be commercial, but it will still be in low volumes. We would like to see it as the business case-driven phase of 5G. Looking ahead into 2020, 5G will mature. There will be standalone 5G technology, meaning that you don't have the problem of anchoring it through 4G. You get the full benefit of low-band cells. The equipment will also come in volumes, the market will mature for 5G. Of course, there is an area of securing spectrum, as Johan said initially, we would like to get spectrum as early as possible, as a Swede, it feels a little bit sad that we're very late here. Looking on our approach to 5G. Our first focus will be enterprise mobile networks to enhance the life of our customers' businesses.
It will be business case-driven. You will see brilliant examples on this. Secondly, fixed wireless access. There are, of course, in our footprint, number of areas where it's not commercially viable to dig in fibers, neither for us or for the customers. With 5G and a fixed wireless access, we can create a fiber-like product for our customers, also business case-driven. The second focus will be mass market. Of course, we will monitor this very carefully, at a certain point, there will be a financial inflation point where it's better to use 5G technology to cater for capacity than 4G. What we have done to prepare is that we have a common platform, meaning the core network and the OSS network. We will have our core platform ready by mid this year for 5G, meaning that after that, our countries can deploy 5G.
Of course, if things change, we can always put the throttle to the floor and increase the speed. We strongly believe that 2019 will be the business case-driven 5G rollout. Looking at that, how that reflects on our investments in the radio access, we see that the coming years will be balanced. It will not be a big peak. Of course, we will balance our investments between 3G, 4G, and 5G. For now, 5G is included in the overall CapEx packet. The new operating model with ambition to take out costs of SEK 0.6-SEK 900 billion, a business case-driven approach to 5G. Andreas?
Very good, Magnus. Thank you. Business case-driven and football fields, even I get that. Ready for some number crunching? I've told everyone that you should have your presentations in a way that you can translate it into an Excel model. No one is better to do that and summarize everything than our CFO, Christian Luiga. Welcome.
Thank you. Good morning. Nice to see you all today here. Lovely to get a chance to tell you a little bit about our numbers. I'm really excited to see how many pens now will come up and start to take notes on all the numbers I will relieve. Before that, I will talk as it is. I talk about the summary of what all these guys are doing every day. I'm just going to summarize it in numbers for you. Hopefully you will find that connection between what I'm talking about and what my colleagues have talked about before and after. Listening to your presentation, Magnus, I guess we also realized even if you're fairly new, your grace period is definitely over.
Of course.
So
That you said the second week, I think. I'm super committed to this will be great.
Good. I'll talk a little bit about the model as well. The thing I will talk about is I'm going to try to bring a little bit clarity on our financials, a little bit from the past, but also going forward and how the things we're doing is going to summarize in targets for ourselves. Targets that we have and we drive and our commitment around that ends up in the cash flow. Cash flow has been a common theme, you have heard me and Johan talk about it for many years. It is the fundamental driver for everything we do. Of course, to have it sustainable, you need to get it into your business performance, to get it into business performance, it needs to show up in both EBITDA and CapEx over time. That is a clarity also for us. Don't worry.
I'll talk about that, and I'll also talk a little bit about our balance sheet. Before we get to the future, stepping a little bit back, EBITDA has been a very important part of our journey. We have a commitment to sustain and grow our EBITDA on an organic level. On top of that, we do new stuff to add to this formula. It has been a challenge with the legacy decline, and still we are successful in growing our EBITDA. Last year, we grew around 1% organically, and we have that ambition going forward as well. We have, meanwhile, in the last two years also then doubled our cash flow. We'll look at it later on. The first year, 2016 to 2017, we had a lot of additional drive from working capital and other elements.
Last year, it was coming through more on the net working capital, CapEx, and EBITDA side. We will continue to grow our cash flow into 2019, as you have already seen in quarter four statement on our commitment. Meanwhile, we keep a balance sheet that we think is balanced, strong, solid commitment to our depth side, and A- BBB rating is something we seek. In the same time, we do honor and see how we can, within that balance, keep a step up in the remuneration to our shareholders, which we then have done over these last years through an increase in dividend in 15% two years ago, last year, 3%, and on top of that, introduced a buyback program of three times SEK 5 billion, which the first round was just finished a couple of weeks ago, and it resulted in a buyback of 2.8% of the shares.
That is a little bit where we come from. If we then talk about the core service revenue, which is and will be a very vital element of our journey ahead, you heard Johan talk about it, and you will hear much more about it from Abraham, Anders, and Stein-Erik later on. We have been able to grow our core service revenue excluding legacy. The bottom line here is including the legacy, the fixed voice and copper revenue, and the dotted line is the one excluding the legacy. Last year also, we had a fixed voice decline in carrier business, which is a no margin of 0.7% impacting this curve. That same number was around 0.3% the year before, it has supported the extra decline. This is a very important line to follow.
We all know we can save cost, and we will save cost, and that is going to be in the DNA of the whole industry going forward. This line needs also to support the EBITDA development to succeed over time, and we have very good plan and agenda for that. If we then step into what we have done on the cost side, I'll talk more about the future, but we have taken the journey of massaging, working with cost in this group over the last three years. We have on this picture, how much we have reduced OpEx net after inflation, after new investments, we have been able to take it down 1%, then half a percent, and then 2% last year. We did step up our game last year.
We did go for a total cost program, which has been very hard to explain, and from internal and some externals been said to be stupid way of doing things because it is a little bit stupid way of doing things, where we actually took all costs in the group and said it needs to go down net. The reason for doing that was to waken us, shake us through the cultural journey of thinking about cost in everything we do. It was a cost program, but also a culture shock to the system, which was very important. That meant that Stein-Erik, which has a very promising and positive ICT agenda driving COGS, he came to me and said, "I can't sell to this customer because if I do that, I don't have cost enough because you're taking away my net cost.
I can't grow." I said to Stein-Erik, "Well, you have to figure out how to find it somewhere else then. You have to go and look more, and more, and more." That was the sort of awakening and shock we needed in the system to think differently going forward. How do we approach and work with cost in everything we do? Of course, I'm not going to limit a cost that can drive EBITDA over time, but we needed to find a way to get into the DNA and the way of the steering, the structure, and thinking in the company. That resulted in a step up in the OpEx, and we also see that going forward. We structure our cost work in Telia in some bigger initiatives and then in local cost programs.
Each of my colleagues here, including myself, we have a cost program on a unit or country level where we drive our initiatives, we follow them up, we have targets, and they are on net basis. In addition to that, we are driving some bigger agenda, like the GET TDC synergies coming through. That will drive SEK 400 million in the cost base, SEK 200 million in OpEx, and some additional revenue, and Abraham will talk about that. That is one big project internally. The other one is the new operating model that Magnus talked about that will also bring a lot of cost takeout and is actually already bringing some cost takeout into quarter one. We have already started that journey. We have the E2E Mass Market, which is the Swedish transformation we talked about that is coming through in quarter one in 2020.
That is going to bring around SEK 150 million on OpEx next year and above SEK 200 million on CapEx. Around SEK 400 million on free cash flow into 2020 when we get that through the environment. The local cost programs are, in many cases, similar, and there we have center of excellence. Like in robotics, we do work together with a common platform, common system for supporting the robotics journey. Robotics is very much about local processes in local systems or in local departments. They are quite similar also between the countries. There we do share, and we do work together. There are other elements that are different, like how I should reduce the fees to the banks, for example. Inflation is driving the cost upwards, and inflation goes on our people cost, goes on our, of course, office cost.
Electricity is a big part of our cost, that is also under pressure upwards. We have growth initiatives that some of them are initially not making money, but over time they all make money, but is also putting pressure on our cost base. This is to illustrate how we work internally in Telia. We then take the new operating model to try to illustrate financially a little bit what Minus so well explained technically is to say that we started with and had up to last year a common platform for, as you said, the operations that is working very well. We have network and we have IT. More of the common IT than the local product IT, but IT. That was SEK two and a half billion allocated into the cost base of the countries based on usage.
1,000 people working there with a lot of externals and SEK two and a half billion in cost. We take Sweden, which is taking about SEK 2 billion of cost and another 1,000 people into the same governance. We then take another SEK one and a half billion and another 1,000 people and move into the same governance. We take around SEK three and a half billion and move into this, becomes around SEK 6 billion. Putting all this together, the first effect we get is some pooling effect. We'll figure out that, oh, we have an external vendor helping us with this, or an internal group working with this that is exactly the same in all the countries.
We then take it to the scale and only making one instead of several, we then take it to the sourcing element of consolidating and scaling, we will get the effects through that. A sneak preview was starting already in the autumn, the official launch was at January 1st this year. This is underway. This is not something that will happen. This is happening. SEK 600 million-SEK 900 million, 10%-15% of the cost base. It's not a dramatic high number, I would say. It's a quite realistic number on this base on putting something together that is quite similar. To be achieved, and then on top of that, the CapEx that is used by these teams also to come with savings with SEK 500 million.
In addition to this, when this is done, which will take some years, we then will have a different platform, which will also give an effect on the country's way of driving their cost base going forward. I would expect that to be at least 10%, but we'll come back with that number when we know more into this journey. We have 2% last year. We are aiming also for 2% this year. Feels that we have control of 2019. Some of the parts coming into 2019 is, of course, rollovers from the activities we did in 2018. You don't start a cost program in quarter one to figure out how to deliver it in the same year. It takes time. This is a quite solid number that we know what we're doing. A bigger part, as you've seen, comes from Sweden.
In the same time, we have countries like Estonia that is growing heavily, and it's much more difficult to take a net cost base out. They will do savings and reallocate cost, but this is how the model works. As you can see, the average inflation for our countries, weighted average, is around 2%. That means around 4% net cost takeout before inflation, assuming that inflation hits all of the OpEx lines. The ambition doesn't stop there. We have a picture and a clear view now based on these bigger initiatives and the cost programs we have in the countries, that we will be able to continue to take out 2% per year over the next three-year period. The split here you can see is quite evenly between the functions.
Network is actually the lowest one with 10%, but that is also where we have a quite good solid base from the beginning on how we work, both from a country perspective and group perspective. A little bit about our EBITDA profile. We declared already in quarter four that the first half would be weaker than the second half in 2019 profile of our EBITDA development. You can see here on this picture clearly on the left-hand side that we have a cyclical pattern in our EBITDA over the recent years, and that cyclical pattern continues into 2019. The starting quarter, we have also announced this morning, will be somewhat weaker than the ending quarter of quarter four when it comes to a year-on-year development of the organic EBITDA.
It will grow as we go into the year and have an opposite profile from last year into this year. In quarter one, it is driven by actually all the three larger entities, Finland, Norway, and Sweden, which will all then be somewhat worse than they were in the quarter four numbers, where actually Sweden will be more stable compared to that than the other two. This is a group, and it combines all of them. It always results in a net number for the group, and that's what we're looking at here. We have also acquired companies, which is part of our plan, and it's part of our group, and it's already paid for, and they count in our cash flow, in our remuneration to our shareholders.
The profile with the reported number, excluding the IFRS adjustment, will be, of course, stronger and will be positive for the years and the quarters. If we then look at the cash flow. Cash flow for the last two years, as I said, have doubled. If we then look at the recent year, we had a SEK 2 billion lift in the EBITDA networking capital and CapEx. We had actually a negative drive from the other part. We said walking into 2018 that we believe that we will have pretty much a SEK 1 billion+ on the EBITDA networking capital CapEx, give or take, and a SEK 1 billion negative on the rest. We overperformed, and it was primarily on the networking capital, and I'll come back to that. For next year, we can see the profile of the cash flow development here.
EBITDA will be the main driver of the cash flow change into 2019. Of course, that is primarily GET TDC. That we have purchased, paid for, and is in our numbers now. We will have a slight decline in CapEx. We'll come back to that. We will have a decline in networking capital. If you look at the interest tax and other, they will be quite even out on this picture. This is based on the current knowledge, the best we know of how the profile will look like for the cash flow for this year. We started a networking capital journey some years ago. We were sitting internally looking at our numbers compared to peers. I realized we were number three in the world from the bottom. We were utterly behind our peers in managing our capital.
Low-hanging fruit gave us an opportunity to put us in par, which we have done over the last two years. We have taken the networking capital down with SEK 3.6 billion. We said we had a potential of SEK 5 billion from the beginning. Today, we upped that from SEK 5 billion to SEK 6 billion, meaning that we believe we have around two and a half billion left. In the past, it has been primarily, not only, to take our vendors to industry standard on payment terms and also introducing vendor financing solutions together with our partner banks. Going forward, it will be more inventory and customer involved in this journey, where we have also opportunities to manage how and when we pay as a consumer or a customer. The phasing I have left out, and I've done that in the past as well.
The reason is that we do this with very much careful thought on how it impacts our supplier, our customer, and the pricing for it. We will never do a bad deal, pricing-wise, on moving working capital out, and we will not be doing a bad thing to the relationship with our customers or vendors, or suppliers in this. That's how we can then take this over time, which we have been able to do, but the exact timing of some hundred million SEK is difficult to measure in advance. CapEx to level out. We have talked about that also. It's been a promise since many years back that CapEx should go down. It has gone down.
It has gone down both based on fiber deployment is lower, but also from efficiency in our CapEx process in how we work with the things that we have already started to work, with the things that Magnus talked about, scale and consolidation, and being smarter. This is a transparent illustration. We try to be very transparent. In the bottom bucket, you have the network part. If you look at the bars that Magnus showed before, that's only part of the network. That's the mobile RAN part that Magnus showed. Maybe around 30% or something of the total network. It should not be thought about the same. We can clearly see that the fiber SDU has gone down. Another thing we see here is that the customer-based CapEx has increased, not since last year, but over time.
That is part of the ICT journey and the journey of making a glue with our customers that we will hear more from both Stein-Erik, Abraham, and Anders in a while. We see that for next year that there should be potential for more fiber decrease, then we will see over time how the efficiency we get from the programs we have will be either needed to be reinvested in new technology or in new programs, or can be a saving on top of this. In the other bucket, which is quite big, that's where you have programs like the E2E Mass Market and programs on the IT side that we do to bring the efficiency into our organization. This is somewhat complex picture, but it's trying to illustrate the cash flow journey ahead.
We have a journey ahead that is an operating free cash flow to be sustained or grow, the main driver for this is the EBITDA. Core service revenue, which I started talking about, will be an important factor of this. The net working capital will go down in importance for the cash flow and then flatten out in 2021. CapEx is flattish this year with GET TDC coming in, savings on the fiber side. Next year, we foresee the CapEx from fiber going down further. On the others, we have a neutral pace now, then we have a negative in 2021. The reason for that is that we will pay some more tax.
We have been without paying tax in Finland for many years, that is many, many years, that loss is starting to get to its end, we will have to start somewhere ahead now the next few years to pay more tax. On top of this, the Bonnier Broadcasting transaction will come through. We said when the transaction was launched that we see that this transaction will bring at least SEK 0.5 billion in net cash flow. Net cash flow meaning the cash flow from Bonnier, the synergy effects, and the integration cost into 2020 of SEK 0.5 billion. With the numbers Johan previously showed, where Bonnier is upping the game, this may be reconsidered, but at this time it's not wise to do it. We don't have the clear numbers from the company.
We will wait and see when we take over the company and look into that and come back on what we think about this number. At least SEK 0.5 billion on the Bonnier transaction to come on top of this. Operational free cash flow to be sustained and grow over time, main driver, EBITDA, the other elements, net working capital we talked about, tax coming up, then on top of that, we have the Bonnier transaction. To our dividend policy and the remuneration setup. We have a policy today, minimum 80% of the free cash flow, excluding the spectrum and license fees, is to be paid back to our shareholders. Last year we paid back, or we are now proposing to the AGM to pay back EUR 2.36 per share, which is 84% of the operational free cash flow last year.
What is required from the company to sustain that level into next year is SEK 12 billion, including dividend from associates. What we guide on for 2019 is SEK 12 billion-SEK 12.5 billion excluding dividend from associates, and that is to guide you a little bit on where we are on our remuneration path. On top of that, we have the buyback program that I mentioned, which also will come to then the AGM and we will have the ambition to continue that another two years. On the sustainability side, of course, it also goes into financial management. You can't be a sustainable company without having goals and work with it in all parts of the company.
One good example of how we actually implement this now into our business is that for some of you may know that we have gone out to the banks and the financial institutions we work with and work with you and actually do due diligence and cooperate with you on your sustainability journey as much as you're doing that with us. Our partners also need to have the same ambition as ours to be part of our partner base in the future.
Also a pension fund that has a investment of over SEK 25 billion to manage, there is no fund that can actually participate and manage those funds together with us without signing off on the principles from the UN on responsible finance. Those are typical actions we do in this area as well. We foresee that we will be an influencer in this area and be part of that group that will drive this going forward. That was my financial part going through the cash flow and which is built on the cost agenda and the working capital and try to give clarity to the shareholder remuneration structure. Thank you.
Good. Thank you, Christian. We are ahead of time, so we have plenty of time for questions. I would urge you to take the opportunity not only to ask Johan and Christian questions, you can do that every quarter, but also include Magnus and Cecilia in the questions. Who wants to start? Nick. Wait for the microphone.
Morning. It's Nick Lyall from SocGen. Morning, everybody. Just a couple, one on cost, please, and one on tax, Christian. Sorry, boring ones to kick off. The OpEx operational changes, it sounds like savings are slowing. Is that the case? When we take out the savings that you mentioned from changing the operating model of the business, it seems like the ongoing savings you've been doing are now slipping away. Is that the case? Secondly, can you give us a bit more information on the tax benefits that remain, the tax assets, and do they include GET as well, please? Thank you.
Good. Thank you. I'll start with the tax. Yes, we do pay tax in Norway. We have some relief in Norway as well, but not as much as we have in Finland. The Finnish number will be the big change in the tax number. On the cost side, no. We are not taking down the ambition. The contrary. I would say that the difficulty is that you put two things together. You can't say, well, in the IT department you should save SEK 200 million, and then you come in with a program from the other side and say you're going to save SEK 200 million and it becomes SEK 400 million. Many of the things are the same.
If the resource takeout in the new operating model is 10%, then you may be left with only 1% or 2% on top of that for another activity, compared to if you would have done it separately. This is where we work in the matrix of having the big programs, and when they are done and then taken out, then we look at what is left to do in the country units one by one, and the ambition has definitely not gone down on the cost. Then we talk about OpEx here, and the activities may also impact COGS, which is more difficult to measure as a net basis because it's so volume-based and also on top of that.
Andrew.
Thanks. It's Andrew Lee from Goldman Sachs. I had three questions, you can just decide not to answer one if you want. The first was a big picture one to Johan's point that you said you're not giving up on growth. The question is: do you think you are in markets that can grow or does Telia have to outperform to deliver top-line growth over the next three, five years? The second question was on the visibility that we've enjoyed in Telia in the past. We've seen a drop-off, obviously, in performance in trends in the fourth quarter and you're guiding to worsening in the first quarter of 2019.
Could you give us a bit more color as to why you're confident we're going to see that inflection in second half growth in 2019? Just finally, I wondered if you're able to comment on the free cash flow outlook post 2021 when the net working capital benefits wash away. Should we still expect the sustainability of the free cash flow levels you're delivering, or can you say anything on that, please?
Can I start with the last one you want?
Sure. You can take the two last ones.
Okay
I'll come back.
On the free cash flow, already in 2021, the net working capital becomes quite small in the profile. I strongly believe that we are a much stronger company in 2021 than we are today. We continue to strengthen ourselves every year. Since we have done 20 years back, we will continue to do that. Yes, there is no reason to feel that picture will change because of the net working capital. The second half, if you look at the price adjustments that we have done, if you look at the phasing of the cost activities that we're doing, that gives us comfort that the second half will be stronger than the first half.
That were the two, yeah?
Yes, that was the two.
Perfect. Growth is, we can try to see this in three different ways. One is how we think this region will evolve over the next few years, which to my earlier point, this region is poised for the next wave of growth early because we are entering into this digital phase very mature. I think the early growth opportunities will be seen in our markets very early. That should be growth if we get things right as an industry, as societies. The revenue streams that we are fighting for is both in core and in new areas, and ICT is a new area in that sense. Convergence for B2B is critical to succeeding to drive revenue growth. That comes without market share growth on the traditional part.
It comes out of a new revenue pool, ICT. The same goes for convergence in consumer, where we extend and grow on the existing base. You also come into market share growth in the existing business, which is then the third pool of opportunity of growth, and we should be in all three. The last two are obviously more tangible and more in our hands. The third one is more the macro part. I think all three buckets will play in our favor.
Maurice.
Hi, everyone. It's Maurice from Barclays. Thanks for the presentations so far. Question on the 5G and enterprise side. Again, on Andrew Lee's previous question, the elusiveness of growth. Should we understand correctly that for 5G, it's really a B2B is where you see the real excitement? Many telcos talk about the B2C, more traffic growth, video as a key enabler. You seem to focus more on the B2B. Is that different or just an area of focus? Secondly really relates to the growth opportunity. Do you think your product set and the investments you've made will help you differentiate against the competition as you move into B2B? It's quite hard for us to analyze the various moving parts therein. Do you think you can differentiate given the investments you've made? Thank you.
Thanks, Maurice. I think it's a phasing challenge and opportunity on 5G. As Magnus pointed out, we see the early pull from enterprise customers, and we're also able to address that early based on non-standardized volume-based devices and spectrum available. That's a natural place to be early on in this region for enterprise, coupled with the fact that they are very early out in the digitalization journey going into this era. Those are the drivers for B2B today. Having said that, we, of course, don't exclude the rollout and mass market adoption, which will come.
It's more a question, when will it come? How do we make sure that we invest properly and timely, i.e., not overinvesting too early? Magnus used a nice expression. We are ready to push or pull the throttle if things move in that direction. It's not like we say, "Hey, consumers will never like 5G and never see the benefit, so let's only focus on enterprise." No. We're doing both. Most in focus right now early on are enterprises.
Definitely yes on your second one, Maurice. The things we have invested into in this region over the last years is convergence capabilities and toolbox in consumer and enterprise. We are, in all those markets that we showed you and in this region, we are converged on both the big segments. That is a differentiator for sure, if we execute properly. We see that now. We've showed you some examples of the glue, the loyalty, the ARPU, the churn effects that are coming. That is the differentiator. We have higher ambitions in our markets to broaden our reach because we are not addressing the full markets yet on the consumer side. Anders will show you that, and Abraham is going to show you that as well. Yes, we think it's a differentiator.
Can I add?
Yeah, please.
I also think there is an urgent problem to be solved when it comes to certain industries. There are no real good options. Other wireless networks like Wi-Fi and so forth, they have a lot of issues with them. 5G fits very well in applications where you drive big trucks in mines, for instance, or drill rigs, or if you have a production manufacturing where you do steel. Things move very fast in these lines. With low latency, with the opportunity to create autonomy in that facility, meaning that you're not disruptive from the outer world. That is a problem to be solved, and that's why I think we have so many customers interested in developing just that part of 5G.
Over there. Ulrich, please.
Thanks very much. Ulrich Rathe from Jefferies. I have three questions, please. The first one is, on the scaling of the cost savings, how did you go about coming up with 2%? Is this simply that this is all that's possible? Or is that related to your view of the top line outlook and what you need, given what you expect on the top line? Just trying to understand the thinking behind why it comes out at 2%, please. Second question is on Bonnier. I think there's been news that your largest shareholder might not be very supportive of this. How do you comment on that? The last one is to Mr. Zetterberg. I suppose this next wave of the centralization, if you will. Is this geographic centralization as well?
Or is there a sense of this stuff moving the product development moving into lower wage countries? Or how do I view this? Because remember, in the last wave that really took out all these different sort of country organizations and I think it was a centralization from 21 to six centers or whatever it was at the time, there was very much moving into the Baltics, and then there was news afterwards that there's issues moving the data into those countries because of security issues and other issues, right? I'm wondering, when you're talking about this next wave, is this going to go all to Sweden or is it going to the Baltics or doesn't it matter nowadays where this stuff actually is geographically? I'm just wondering how you think about that. Thank you.
Can I start with the last one? Yeah. I would like to emphasize that the new operating model is not a Swedish model delivered from the headquarters in Solna. It will be resources taking part of that common function being active in all our countries across. Secondly, we have a shared service center in Lithuania, which is our own, and we're growing that steadily. That will be one part of or one piece of the puzzle that we're building. I think it's important to say that technology is playing in our hands for this operating model. Today, infrastructure gets more and more cloud-based and virtualized, and that fits very well with this operating model.
Thank you. On the 2%, it sounds very precise for each year, I can imagine, but it is not. It is actually a calculation, as you say, based on the initiatives and the activities we see in front of us, both the growth activities and the savings need and opportunities that we have. That's why I said for 2019, it may be a plus in one country and a bigger minus in another country. In one department, definitely it could be 10%-12%, in another one, it could be growth of 15% based on our activities. This is not just based on that.
There is, of course, with our plans to grow and the cash flow, we need to have a certain level to meet that as well. It needs to also be balanced because the growth will not only come from OpEx savings, it comes from actually creating a better business in total. It could be that in our calculations, it's a couple of percent or decimals from that on 2021, but instead of writing 1.9 and 2.2, it is a 2% target, which is quite clear and easy to remember for all of us going forward. That's as simple as it is, Ulrich. The last question, Johan.
Let me also try to be quite simple in my answer to a maybe more complicated question on the Bonnier Broadcasting acquisition. Backtracking a couple of years, we've been very clear that we believe that content is important for our convergence, and convergence is, back to my earlier answer, something we believe is a true differentiator in our markets. Having done a content deal in Finland, also then preparing to make a bigger bet, which we did last summer, into Bonnier Broadcasting, has strategic rationale, which we have explained through the years, and it makes financial sense, which we have showed also today. We strongly believe in the synergy takeout that we are very committed to, which is an important part, as I showed you, on the value creation of Telia going forward.
We have also, of course, noted and taken part of discussions and views on this deal from general public and other stakeholders, including owners. In the beginning, there were a lot of skepticism around this deal. As we have been able to talk about this deal through our major shareholders and small shareholders and general public, it has gained acceptance and understanding. There's still work to do to educate and, of course, execute on this deal when it goes through. Shareholders have to make up their minds whether they like our equity story or not, and that goes for big shareholders and small shareholders. On the last note, this is a process in Brussels, which is under scrutiny and approval, and we have filed, and we are confident that we can maneuver this process through into a closing in second half. That's still our view and position.
One question. You kicked off the presentation by sort of an urge us to move away from the short-term focus and think more longer term about the company. You gave us a very interesting presentation on sustainability and sort of 2030 targets. Predictably, the market's reacting most noticeably to the Q1 outlook. There's a bit of a contradiction in your financial steering. You're using the shortest-term financial measures, EBITDA, operating free cash flow.
Have you given any thought to maybe using alternative financial measures, earnings, returns on capital, to allow us to judge the sort of longer-term performance, particularly as you're looking further out and thinking about sustainability? Also even the dividend, paying out a very high proportion of operating free cash flow when these investments you're making may be getting returns in 10, 15, 20 years. Just interested to hear your general thoughts on the financial steering of the company and the contradiction short-term versus long-term. Thanks.
It's an interesting perspective, definitely something we are debating and discussing internally and with the board, how we should have relevant steering on long-term incentives and short-term incentives. We have been, of course, using ROSE and other measures internally to drive and steer, but not talked about publicly, and that's something we're still considering. With the long-term ambition also on sustainability and how that impacts long-term value creation, that is probably a time now to relook how we measure going forward. Good input.
I just want to add, I think you will see us come back and talk more about return on capital employed going forward. One of the dilemmas we have had, I think, first of all, the industry has not talked about it, but we have had, is the complexity in our portfolio with the Eurasian business, the divestments, and the MegaFon and associates. Now that out of the way, it's actually much easier and cleaner to follow the rest of the business going forward on the metrics you're talking about when it comes towards the shareholders. On a individual country, we have return on operating capital, we call it internally, which is a certain measure we actually then also seek to tweak up every year, of course. PK?
Thank you. You discussed the new operating model as Magnus presented, which seem mainly to include processes and products, less on the infrastructure and the network side. Surely you must be coming to the point where you're considering process renewal on the network infrastructure, perhaps most particularly on the copper network. Anything you can tell us about the decommissioning on the copper side, your plans here, please? Also just, Johan, you highlighted the positive trends in the Bonnier we've seen in 2018, which is of course good news. Nonetheless, it still leaves you with substantial exposure to the advertising markets. I know some content companies, including locally here in Sweden, are trying to move away from the advertising revenue dependency. Anything you can tell us to reassure us that this is not sort of adding a new cyclical element to Telia or risk factor? Thank you.
Thanks, Peter. On the first one, I'll keep you waiting for Anders' presentation for Sweden, he will address that for you.
Can I start a little comment on the network side? I didn't mention that, but we are quite mature when it comes to network technology and harmonizing the standard specs and so forth across the group. That is sort of already there, and there's been good successes and development in procurement during 2018 on RAN access and so forth. Then I leave the legacy to Anders to talk about.
Good. On Bonnier, clearly we are entering into an area where advertising and advertising revenues are in itself a kind of cyclical thing. In bad times, advertising normally goes down. That part is in there. What is comforting, though, in the business model of Bonnier Broadcasting, both in Sweden and Finland, is the transition from only advertising into paid OTT SVOD services, and that transition is happening. It's de-risking the model for future worsening economic situations, even though advertising business clearly is the majority part of that. The second part, obviously, is that since they are so strong in advertising and market share, they are still the go-to partner as long as you need reach into consumer and households in these two markets. It is the best assets to have also as economy may or will slow down.
We have time for one more question. Ulrich, you had your, we can take it over there.
There are more Q&As coming after the next presentation rounds.
Henrik.
Thanks very much. It's Henrik Aslaksen from Credit Suisse. I wanted to follow up on the growth comments you made. Basically, I think you showed on your breakdown of the operating free cash flow improvement that the new revenue streams would improve. I'm not really sure if it should improve or if the trends would improve or just continue to grow. If you look at your whole revenue or service revenue base, do you actually think you can get back to growth within the next two to three years?
I guess what would be the big sort of uncertainties or swing factors to that? Secondly, wanted to follow up. You've talked about your efficiencies. One thing that some other telcos talk about is network sharing, but you haven't said much about that. You used to have a sharing agreement in Sweden with Tele2, and in Finland you share with DNA. Just your thoughts in terms of what you need to own of your network and whether there are potential sort of savings there. Thank you.
Let me go back to some of the statements made on service revenue growth and our ambitions and our fight for growth. There's no certainty around, obviously. We see enough trends, we see enough capabilities, and enough opportunities now in the next phase to say we should be in service revenue growth territory as a group. The only thing that is keeping us away from that now is the legacy decline on some of the old fixed components. That means that we have to grow even more on the core and the new services.
That's where we have Telia Global, we have convergence, and we have our smart pricing based on analytics that are really key drivers for the next wave of growth. That doesn't have to come back to Maurice's questions earlier, or Nick, I think it was. The only way to grow is market share gain from others, that there are other buckets to grow from. We're as comfortable and confident that you can be when you talk about service revenue growth over the years to come. Christian.
On network sharing, yes, I think network sharing is something positive. We actually have a network sharing in Sweden as well with Tele2. We should remember that as well. We have in Finland, as you say, with DNA. I'm more attracted to network sharing than selling networks. That's based on actually the synergies between the network layer and the customer layer, but also on that we are quite well equipped to figure out how to be smart in our networks. Finally, we have actually in the Nordics come quite far in making the utilization of the networks to become quite high. That doesn't rule out anything over time. Network sharing actually requires two to tango. That is also based on market position, where you are in your development sort of path, and what kind of customer offerings you're trying to drive.
Perfect. Thank you. Now it's time for a break. There's coffee outside. We'll be back here at 10:30.
Okay, welcome back, everyone. I hope you had a good leg stretcher and that you feel that we've given you some food for thought so far. We're going to be diving into the business units, the countries. First up is the man you've been waiting for, a person with long experience from the telecom industry. He's with us at Telia, heading the Swedish operations since this summer, Anders Olsson. Welcome on stage.
Let me just start by coming back to what Cecilia talked about before. The sustainability is actually a thing that we have in this house in the afternoon. It's not only about how to attract people at Telia or being a good citizen. It's really driving business for us going forward. You that have any time, please stay in the afternoon and look at the booths that we have upstairs. You can get an example of things that we are actually doing in that area. In this section, I will give an overview about the key drivers for Telia Sweden. We are operating in a fairly sound market environment. We, as the market leader, will play a rational role in this market. We are facing a legacy revenue decline. That is mitigated by a transition plan.
We have been working with a continuation of efficiency measures, those will continue over time to have a constant OpEx reduction in years to come. We will drive convergence based on our leadership position, which will be a core foundation for driving revenue in the core in years to come. These are the things that I will spend some time on speaking about in this session. If we look at the overall market, as I said, it's a fairly sound market. On the left-hand side of this graph, you can see that the core revenues in the Swedish market has been growing the last years with some +3.5% CAGR. All the core services had a decent growth since many years. Legacy, which we are predominantly in, that market is more of a Telia business.
We have, as you know, had close to 15% negative CAGR, the overall market is pretty sound. The concerning trend in the short time period is on the consumer mobile service revenue side, where the graph in the middle is the development during the last quarters in Sweden, where you can see from fairly healthy levels, it has step-by-step during 2018 come down to a level where we actually do not have a growth in the last quarter on the consumer side. This trend obviously needs to be shifted, we as a market leader in Sweden will play a rational role to get this market back in growth. Nonetheless, it is of course affecting the near-term revenue in the market in general. Looking at the right-hand graph, it is the market share development in Sweden the last years. It is fairly stable.
We have defended the market shares in the core products the last years, the small decline in Telia's market share is fully then driven from the legacy decline that has hampered our market share a bit. The service revenue pressure has affected our profitability the last years, as you know. We have had a decline of some SEK 1.3 billion in EBITDA from 2016-2018, this decline, though, is fully driven by the service revenue decline. If you look at the right-hand graph here, you can see the decomposition of that service revenue. The SEK 1.3 million in service revenue decline is actually coming from about a SEK 2 billion decline in revenue from legacy and the installation fees from the broadband rollout. Compensated and mitigated partly by 1% CAGR for us in the core revenues.
Linking back that to the left-hand side, we also have then a little bit lower margin on the new service revenue compared to the margin we have in the revenue that is in decline. Meaning that high gross margin on legacy and high gross margin on the fiber installation fees, while the new services to some extent are lower margin, for instance, the OC and the Open City Networks revenue that we get in, for instance, TV services. That means that we have had a OpEx net reduction that is compensating the margin loss, by that, having equal EBITDA decline as the total service revenue decline in the Swedish market for us in our numbers.
The key three drivers for Telia Sweden, that is legacy business, that is how we are dealing with the cost, and that is also how we will drive revenue through convergence going forward. The rest of the presentation I will spend on going through these blocks one by one. Starting with the legacy business. We have in our definition, that you are familiar with, reporting the legacy decline based on a definition of fixed telephony and datacom. On the left-hand side on this slide, you see the full revenue we have on our copper-based network of some SEK 6.5 billion yearly revenue. This is the 2018 numbers. We have substitution services for all of these different products. But obviously, on the fixed telephony, the substitution product is less of a possibility to drive the whole migration, since a lot of customers already have a subscription with unlimited voice calls.
For the other products, we are doing mitigating activities to recapture as much as possible of the decline in the copper service. As you know, we have actively rolling out fiber. That will be reduced in years to come, but still, we will have a fiber rollout that will capture some part of the decline in copper-based broadband. Then we are increasing the possibilities to sell broadband in existing networks, both upsell on where we have our own infrastructure, but also opening up a broader universe of selling to the Open City Networks, where we now have the majority of the city networks available to sell our services to. On top of that, last but not least, we of course have the mobile replacement possibilities. Today with 4G and over time, step by step, we are rolling out FWA based on the 5G networks as well.
These activities are not fully mitigating the decline in the legacy revenue, but clearly a plan to recapture as much as possible of that going forward as well. We had a question on the cost of the network, and there is clearly a fairly substantial cost related to the copper network as well. An important thing to understand of this cost structure is that it is not related to amount of customers, nor the revenue we have on the network, but it is based on the size of the network. Roughly half of the cost is related to the size, and when we take out the size of the network, that cost is reduced, and half of it is related to platforms to run the network.
That means that we are doing a step-by-step geographical closedown of our copper network. On the right-hand side, you see examples how we approach that. One thing is that we are doing station-by-station closedown. When you have too few customers on one station, predominant in the rural areas at this point in time, you close down that station. The other approach is that you can digitalize a municipality, and by that, closing down a full city at the same time. At our first example, where we did that was actually the region of Sunne, where we at one day basically closed down the whole network at once.
The third area is when we have either faults in our network that is too costly to repair, or that we're affected by external factors, such as the storm we had on the East Coast around New Year in Sweden, beginning of this year, then becomes too costly to build up, then we do a migration or closedown of the copper network in that region at that point in time, and offer instead our customers a mobile service, a mobile replacement substitute. Coming into the cost side, Christian already spoke about our cost going forward, as I said, we've had a cost reduction in the last years, and we will continue having that cost reduction, OpEx reduction going forward.
We already communicated by Q4 report that we have intent to have 3% OpEx reduction of 2019, and going forward, the target is to keep the cost OpEx reduction at that level. How we work with this is both on the resource side, that we're working actively to buy RPAs and also to make the organization more efficient to take out resource cost. We are looking at how to become more efficient in the SAC and the SARC cost, not the least by driving to the more cheap channels, both on the serving our customers, but also selling to our customers. We are also getting a pooling effect already now of the new function that Magnus is building up under Common Products and Services, where we are moving order now people from Sweden to CPS, and by that, immediately getting a pooling effect.
Going forward, we will continue these kind of activities and have a continuation of the resource cost takeouts. As Christian already mentioned, we also have then the E2E Mass Market initiative, which we will get effect of as of 2020. On top of that, as already Magnus spoke about, we will have the continuation of the effects of synergies that we're getting through the new structure of Common Products and Services. Coming into the last area of how to drive growth going forward. The starting point in this overall thing is the convergence. The starting point for us is that we have a pretty strong position in the Swedish market. We have a very strong brand, as many of you know in this room. We actually have the most satisfied customers for most of our products, and we're clearly the undisputed quality leader.
Quality leader, I want to mention some words about. Some people have asked me during the many years these questions have come up, if we're not getting into commodity industry, and if quality is that important going forward. We clearly see on the B2C side that the quality is not getting less of importance when you are deciding what operators to choose. The thing that is maybe changing is that on the B2B side, quality becomes really more important since a lot of the B2B companies are getting very dependent on the service that we as an operator are providing them. As we already mentioned, I mentioned, and Cecilia was in too, we spice that up with something that is also very important, and that is the sustainability. We can see that from the consumer segment.
It is an area of importance of what to decide on what operators to choose. Clearly on the B2B side, it is a very important component of not only, again, that we are a good citizen, that we're driving their ambition to become a sustainable company. We have our way of doing convergence, and we have that under an umbrella in Sweden, which we call Telia Life. I'll come back to that. Instead, I'll speak about the middle part. This screen here is blacked out. The middle part is, of course, a very important part here as well. That's not only that we're coming from this very strong position, we're also having the serving all the different segments. On the consumer side, all different segments, and on the B2B side, from the smallest business to all the largest companies and the municipalities and all areas.
We're doing that with a broader product portfolio than anybody else in the Swedish market. The broad product portfolio, combined with our very strong position, means also that we have a strong pricing power in Sweden. An example of that is what we are doing now. As of next week, we are increasing the prices for the majority or the key products on the fixed side in the consumer segment. Increasing the price of our fixed telephony. We are increasing the most sold TV package called the TV Telia Lagom, and we are increasing the price of the most sold broadband product in the Swedish market. The prices are not increased yet, but in the churn, you get two waves. One thing is when you announce this, and one thing is when the actually price hits them in the envelope of the invoice.
All of these price decisions are based on business case, and we feel comfortable that we will meet the business case results in these price increases. Now we come to the convergence on the B2C side. The left-hand side of this picture is an actual picture of our product mix in our consumer base. As you can see, there is a pretty big overlap between TV and broadband. TV for us is a very important component when we sell broadband. We have the most satisfied TV customers in Sweden, meaning that that is a very important point. The other thing on this left-hand graph is that we don't have that huge overlap between the broadband and the mobile. That means, of course, a great opportunity to sell mobile products to our fixed customer base going forward. How do we do that?
The middle part of this graph is the umbrella that we have convergency under in Sweden. We call it Telia Life. I will, in next page, come back a little bit of how that product setup is, or that proposition is built up. The Telia Life is a starting point. That's not the end point. We are over years to come going to continue with a ladder of increasing the share of wallet and also increasing the loyalty by adding on things to the convergence offer. Now with predominantly fixed broadband and TV, and of course, also how we can accelerate the mobile, and years to come, other things, which I'll get back to. Starting point in this journey is a broad broadband penetration. We have mentioned that we are getting into the tail of the broadband rollout on SDUs.
Not for sure stopping, but not in the same volumes that we had in the past. That does not mean that we are limiting ourselves in possibilities to attract broadband customers going forward. The left box on this graph is our reach through our own infrastructure. The starting point in that penetration journey is that we still have a fairly big amount of customers that we have homes passed, they're not connected yet. It's about 300,000 customers. We have the fixed line passed close to the house, but they are not connected with Telia yet. Obviously, great potential of further penetration. The next block in this one is the Open City Networks. Open City Networks, the first part here is where we have worked the last quarters to increase the reach.
Signing up agreements with most of the Open City Networks, and by that, getting a possibility to sell our services within their networks. Let me just remind you once again that we have the best TV service with the most satisfied TV customers, which, of course, is an important component when customers are deciding what offer to go for. In that part, you see that we have a fairly small, the pink part, is the amount of customers we have in that poll at this point in time, meaning a great opportunity for increasing that penetration in years to come. We have an ambition to cover the full Sweden, and that they should have the possibilities to get broadband services with us regardless where they live. The first little part in that, the small 300,000, is the Open City Networks that we're not covering today.
We are in negotiations with them, and step by step we'll fill that part. The last part, when then is where we can then get out for covering the full country, where we are still rolling out some SDUs in years to come. We are potentially, or we're looking for potential acquisitions to cover that box as well. Last but not least, we still have the possibility with radio. Today with 4G and years to come also with 5G. Meaning that we have the ambition to cover full Sweden with possibilities to get attractive broadband from us. The next part is to get the offers, the convergence offers. As I mentioned, our umbrella is called Telia Life in Sweden.
We have an updated offer that is now expanded, so you can get choosing from a customer, not getting all, but you choose if you want to have the benefit, either by getting up a tier in the mobile bucket or by getting higher speed on the fixed side. Not discounting the market, but giving benefits for the customers to choose us as a converged operator. On the right-hand side, you have the proof points in this, where the upper graph is the satisfaction of the customers. You can clearly see that the customers with more than one product for us have a higher NPS, high satisfaction, which then leads to the very important part, and that's the churn numbers, where you can see that customers with more products from us clearly have a lower churn level than customers with only a single product from us.
How do we take this going forward? Well, as I mentioned, the foundation of this is to have big broadband reach. We are, based on what I already explained, expanding that reach and the penetration in that reach step by step. We are getting a converged customer base on top of that. Let me remind you once again that the overlap of mobile in our fixed base is fairly limited at this point in time, meaning that in years to come, we have a clear possibility to add on more mobile customers to our fixed base. We spice that up by launching other services in years to come.
One very important example of that is Bonnier Broadcasting, where we then hopefully in the end of this year will be able to offer unique offerings to our customer base and by that getting attractive proposition spicing up our TV business. Adding other services that we can bundle with our access. Here we're also working actively with Division X to test and see what are those potential services that are relevant to bundle with access, and that can increase the stickiness going forward even more. When it comes to the B2B side, the starting point is similar. The best network and the broadest fiber network is a crucial component also in this side. I would argue even more important going forward when all companies are dependent on having a service that actually works all the time.
For us, as already mentioned before, we also have Telia Carrier, which is an important part in our portfolio of companies, where we not only in Sweden can provide services to our customers, but control SLA structure of our own network across the globe, and by that getting customers to really understand and we can commit to SLA structure. We're doing a similar convergent journey as in the B2C side, but of course, some differences as TV is not the key application for the business market. Here we're doing on the small business customers, we're doing an ICT journey where we are bundling our access with communication services, and by that getting a broader product portfolio to them. Increasing the revenue pool slightly, but also increasing the stickiness. We are working with, for instance, Personlig Tekniker, launched earlier this year, very relevant for small companies.
Acquired a small company called [inaudible] that's doing workplace applications that is important thing to bundle, that we can roll out across Sweden. For the larger customers, that is rather to be part of their digitalization journey. We are having already a set of products. Magnus mentioned already that we're selling contact center solutions. That is a standalone application, but of course, can be bundled with our access services. We're having a company called Humany, which we can do AI services with, again, bundled with our access. By getting into more of innovation together with our customers, and by that, securing the access revenue, also adding on new revenues and increased stickiness.
As for the consumer side, this is a journey of years to come, where the foundation is that we are the company with the highest perceived and actual quality, where we add on solutions, applications based on our connectivity services, getting into an ecosystem set up where we work with other companies, other partners, and together with them, become a fundamental supplier for a lot of the B2B clients. Some examples of that. We are working with Division X. Division X have their own revenues. For us in Sweden, it is not only the revenues that Division X is having by themself, they are also a door opener to especially the large segment, and also, again, providing stickiness. Where we are having crowd insights based on the information we have, anonymized information we have about our customers.
We are having some bets which are most relevant for our customers, but also that are relevant to bundle with our access services. One example of that is healthcare services. We are working with new technology, and at this point in time, 5G is an important new technology that both will generate revenue in the B2B side going forward, clearly, but also important as a positioning thing for us in the Swedish market. Here we have a 5G program. We are doing that together with some of the most important clients, together with Academia, and together with regions across Sweden, and by that, getting a constant learning, and by trying some applications for one industry. At this point in time, mining industry is important and optimized self-driving cars, important industry.
By that, getting the learnings that can be applied for other industries or services in the related nearby industries. This we are pretty proud of. Without having a commercial license in Sweden, we are still clearly taking the pole of 5G in Sweden, getting the foot into some very important businesses, creating business opportunities with very limited CapEx. The last area on this slide is how we are also working with customer-driven innovation. How we are getting in a door opener with one of the services that we are selling to others, or by discussing about co-creation, start to develop with one individual customer. The area of security is one example where we have our own SOC, we have our own digital identity, and we have the capabilities of doing transactions in a secure way.
By that, going into the co-creation with one company that later on can be replicated to other companies as well going forward. To sum it up, we have a legacy decline. That legacy decline will be fading out of years to come. We have had and are continuously working with efficiency measures, and those will continue over time as well to have a constant OpEx reduction in years to come. We have a clear possibilities to continue the convergence in Sweden based on our very strong position as the market leader and the very strong brand we have, both on the B2C market and the B2B market that will cater for growth in core revenues in years to come. Meaning that we are also getting into an EBITDA trend shift as of 2020.
Going back to where I started, we are operating in a fairly sound market where we as Telia will take a very rational approach. We are facing legacy service revenue decline, but there is a clear mitigation, a transition plan for the coming years. We are having an OpEx reduction, and we continue to work that we maintain that OpEx reductions in year to come, and we will get growth in our core revenues years to come based on convergence and the strong position that we're coming from. Thank you.
Thank you, Anders. Very good and quick. If you stay here, Anders, we might have some time for a question or two on Sweden, and it's only this segment that is asking the questions. Stefan?
Yes, hello. You showed that the mobile service revenues was deteriorating. There is some increased price pressure in the market with especially fighting brands being a little bit more aggressive with Hallon and Vimla, and you do not have an active brand in that segment. Is that something you're lacking in order to successfully compete in the market?
You have to bear in mind that even if that segment is pretty big in volume, it still represent a fairly small portion of the revenue pool in the Swedish market still. Our key position is to make sure that we are clear on our differentiation and clear on how to drive revenue by the convergence building on the strong brand we're having in Telia. That remains. I would say that one of the reasons for that deterioration of the revenue last year is also a bucket inflation that was happening in Sweden during 2017, 2018, sorry.
Lena, over there.
Lena Österberg, Carnegie. I have a question on Internet of Things, one of your new growth areas. Where do you expect the long-term profitability of that segment will be, and how long will it take you to get there?
Internet of Things is such a broad term, I think it's difficult to just isolate that to one part. Internet of Things has both a standalone possibility to drive revenue by itself, and one part for that is the pure connectivity. The other part is, as I was into, is an important component for us to sell complete solution to customers, where the IoT revenue plays one role, where that combined with the other parts, including the traditional access, plays another part. I think I will have difficulties to pinpoint a specific number, but we clearly have a good growth in the area of IoT, and I would argue that in the Swedish market, Telia is taking the pole position of that more and more to be able to grow that even more going forward.
Can I just rephrase it? Sorry, then. If you say take the new services that you have, which are going to replace the declining legacy, what's the rough profitability of the new ones versus the old ones? Even if you grow there, will you still have to keep cutting costs forever and ever?
When it comes to the legacy, I showed you the numbers there. We are not replacing the complete legacy decline by the margins of new business. One thing is that some of the legacy products will not be possible to be replaced, and we have a bit of a lower margin when it comes to new services. Bear in mind that we are getting into the later part of the legacy business in Sweden. The fiber penetration in Sweden, that we have been driving fairly much, is much higher than the average in total European Union. Even if in absolute terms, our legacy business still is fairly big, we are getting into the tail step-by-step also of the legacy revenue in the Swedish market. Hence, years to come, the pressure of the legacy business will step-by-step fade out.
Thank you, Anders. I think that was what we had time for. You have to come back in the Q&A session after Norway and Finland. Now it's time for our newest kid on the block when it comes to convergence, Norway, with CEO Abraham Foss, that will take you through the integration of Get and the overall Norwegian market. Welcome.
Thank you, Andreas. I do really feel like the new kid on the block. It feels great to stand here as a little brother growing up and finally be able to join the bigger party with the bigger brothers, Anders and Stein- Erik. We have some key messages. The key messages are clear, at least to us. My task is now to convince you to be as clear as I possibly can on our agenda in Norway. I'm going to talk about a market which from a competition, from a consumer, from a regulatory point of view is interesting. We have built up change competence, we have built up strategic position, and now entered into a new phase with the Get TDC acquisition. We feel that we're well-positioned in the digitalization journey for Norway, for customer, regardless of context, technology, and segment.
In that journey, the convergence offering and the convergence position that we're going to develop, both in the B2C as well as in the B2B context, is vital. It's not the only thing we have to do. At the end of the day, we're driven from a cash flow. We need to have a very careful and very ambitious agenda on the cost side, which I will cover in the later stage of the presentation. If we just quickly look at the Norwegian market, there are a couple of key messages. It's a very high purchasing power country. From a brand tracker, we see that the quality consciousness in the Norwegian consumer market is very high.
It exemplified in the fact that we get a lot of customer complaints during summer because then people have been abroad and they've experienced mobile networks outside Norway, as an example. It's a very high affinity to quality. It's also an interesting combination of immature convergence market, but with a high expressed willingness to actually embark upon that journey. That's exactly what we're positioning ourselves for. We have a good starting position now, both in mobile, in TV, and the broadband, which I'm going to explain later. If we look at the market trend, we see that there's a healthy development during last years on the B2C segment, between 2%-4%. On the B2B side, which is more driven also from legacy products being scaled down in the market as such, it's at roughly around zero.
We are well-positioned in the mobile segment. There are two major players, Telenor and ourselves, and we now have the capabilities, as you can see on the other chart linked to the fixed position. We are very firm about looking at the Norwegian market as a very solid platform and a very solid market in years to come. Just quickly look at what we've been doing during the last years. We've acquired Tele2. We've had a very active approach of building a holistic brand portfolio, cutting out three brands, TDC, Tele2, and Chess. Rebranding from NetCom to Telia. It's a very young brand in Norway. Telia has only three years in Norway, which is very interesting upside going forward.
We've built the position also as a reputation in the market, you can see in the middle graph, which is across all the big companies in Norway, we have grown a very nice position. That's important because we have also had a very ambitious competence change journey in Norway. If you look at the competence in terms of a balance sheet, it's a very big change that we've done during the last years. We've then obviously built the network, which is comparably a very high-quality network on the mobile as well as on the fixed side through the GET TDC. On the side there, we've also then worked hard on building digital capabilities, which I'm going to talk a little bit more about later. In other words, we're well-positioned for the next part of the journey.
That's an important part of the story because you need to believe that we're set out to do what we want to do in the next years to come. Alongside that journey, we've built financial position performance throughout the last years. If you look at the last year, that's only one quarter with GET TDC numbers, and that, of course, will be a full in 2019. I'm not going to speak more about that part now. Quick glance at GET TDC, which we've acquired. It's a 4 billion NOK business, roughly 80% GET, and fairly stable. Slight pressure on the EBITDA, driven from a pressure on the content side. We've managed to pass on most of that cost to the customers, and that's important for us also in the future, obviously. Very good speed out of 2018. Far it's looking good.
That history we want now to transform into the next relay, next part of our journey. We're now integrating a company. We're running fast. We don't have much time, that also reflects the position we have in Norway. We're not an incumbent. We're a challenger in Norway. We're running fast. We're building common culture. We have a leadership in place. We've put together IT organization, put together a network organization. B2B is operating as one operation. We have rebranded TDC to Telia last week. We're running fast in integrating the company, both system, people, and culture-wise. Going a little bit into the numbers, because at the end of the day, I guess this audience is inclined to have certain interest in the number part of the presentation. Johan covered that clearly initially.
We have upped our cash flow synergy target from NOK 700 to NOK 800 based on the work that we've been doing after we got the approval in Q4 last year. We have also then identified extra cash flow synergies linked to working capital of roughly SEK 200 million. We've also increased the integration cost roughly SEK 100 million, which offsets that part. That's of course a one-time issue. The important part is the SEK 800 run rate out of 2022. If you look into the split of those SEK 800, it's roughly SEK 300 on the revenue side, on the conversion position that I'm going to talk more about. That's the visibility we have to that bulk of the synergy. We have SEK 350 on cost, as well as SEK 150 linked to CapEx. I'll speak a little bit more about that.
If you go into the cost side of it, this is 2022 synergies in Norway from the GET B2C on the cost side. There are several drivers. You have the immediate G&A expenses. As I mentioned, we've put together organization, both IT and network, customer care, B2B. That's already as one organization. We haven't taken out the synergies yet, that's one that we've started on in 2019. It is obviously on the system side, both linked to what we can do in Norway, as well as linked to the message that Magnus had earlier today as a part of the future operating model, also in the Telia Company context. On the market side, we definitely have a huge upside also linked to the marketing cost, because currently we're operating both GET and Telia out in the consumer B2C segment, there are long-term synergies linked to that part.
We'll do that carefully. There's a very detailed program broken down. This is a long-term 2022, there will, in any case, be many unknowns, but we have a good visibility and very confident on this. We are actually applying some of the same methodology as we did when we did the Tele2 merger, as well as the Phonero merger. On the CapEx side, there are two major drivers of obviously platforms based on products and IT, clearly a potential, as well as building out our network also in the future 5G context. We now have a much better resilient network in Norway linked to the infrastructure that we require, this is a nice opportunity. This will also be linked to the, of course, the new operating model message that we have throughout all the presentations here.
On the working capital side, I mentioned upside of roughly SEK 200 linked both to how we capitalize on the suppliers as well as also on the inventory side. There are several drivers and a good visibility to those kind of savings potential. If I then move a little bit into the market side, I'll also then start to enter into the convergence part of the story. First, I'll just quick comment on the mobile consumer side. In any convergence scenario, developing our standalone mobile in the B2C segment will be important in the next years to come in any case, because an important driver regardless of any convergence story. If you look at, we've built up then a holistic way of developing our brands. Telia, only 2 years old. Then using OneCall specifically in a price-positioned way.
Mycall in ethnical segment, very interesting brand, very strong brand in that segment. The Telia, of course, built on the brand platform that we have described earlier and based on the digital hub and also with a wider, broader value proposition as well as wider and broader reach channels distribution network. Across those brands, we then work with some common themes. It's obvious that we are working on a personalization agenda in order to be able to both be more successful in the customer interface, but also to drive the cost agenda. That's an important message. There is no absolute contradiction between a cost agenda and a revenue agenda on many items on what we do. Here is a good example of what we have been doing.
We have a very active approach in terms of how we develop our digital capabilities and how we set ourselves up in a customer interface so that we could do that more tailor-made, more cost efficient, and much more specified to you as an individual or a customer segment. This has been going on. This is a very important message in the go-to-market model. The same also on the digitalizational customer interactions. We have an ambitious robotics automation program. We do a lot of upselling, also based on optimized processes. There's a very aggressive agenda in terms of delivering better customer interactions based on chatbot services, as an example. We all do, but it's an important part of our message. Throughout the whole value chain, the use of handset is important. The role of handset is important for all the brands.
Just as a note on the side linked to Cecilia's message, we introduced in OneCall a concept called Nesten Ny, almost new, which is very well received, where we then sell almost new terminals out to the customers. It's a good value proposition. It's appreciated, and we get a lot of good feedback, and it's a good business model, and it's definitely an important part of the sustainability. That's important in terms of understanding that a part of the sustainability is not just an investment, it's good business. That's a good example. Other examples could be using our force towards our suppliers in order to remove plastics on all kinds of goods before they've sent it into one of our stores, which reduces the plastic levels, as an example of something which is very much appreciated both by customers as well as employees. Moving on. Convergence, B2C.
We have now entered in from being a mobile-only player to be with converged capabilities. One example, if you look at on the left-hand side here, we have done 30% of the GET customer base are Telia customers, which means there is a significant upside. It's very similar to the message that Anders had on Sweden, which from an overlap point of view, is a very attractive way of looking at the potential in terms of addressing value proposition and addressing both sales and value proposition-wise to that segment. Furthermore, we will then work on driving the loyalty affinity between ourselves and the customers. I didn't mention it, but a very important integral part of the Telia Company, as well as Telia Norway strategy, is the customer journey. We don't believe that we can differentiate ourselves technologically long term. That's only temporary differentiation.
Customer experience, customer journeys, that is much harder and has a much better potential for, and we're very much concerned with that. That was also the best message from Johan this morning. Here in the B2C convergent context, we have low penetration in Norway. Telenor has not been active, and only Telenor and ourselves who have the capabilities at this point in time. Together with Bain, we've made an analysis and say that 80% would consider to have an offer, but only 10% get it today. Doesn't matter whether that's 80, 70, or whatever. It shows that there's a big potential. This is where we're going to work. We've seen from Anders on the churn reduction linked to a number of products. We'll see that in Finland. We see that globally.
We've targeted a significant lower churn, which both from a customer development point of view, but also from a cost point of view and from a stickiness point of view, is important part of our agenda. Moving on, we will definitely then work on how do we develop new services to build upon that kind of loyalty. We have a company called Futurehome, which is a very integral part now of how we address the MDU, specifically the MDU market, also the SDU, but mostly the MDU market in GET. With safety, with sensors, with alarms, even when we have negotiations with MDUs and we have a price pressure, we're able to maintain and in some other places grow our ARPA based on those kind of capabilities, and it clearly drives loyalty.
GET has a long history of being creative in terms of how to package and drive the bundles in the market, that's an important part of what we then do going forward. Moving on to B2B. We have, through the acquisition, clearly repositioned ourselves. We have roughly now 1 million daily users in this segment, half a million mobile customers, and it's a significant infrastructure. In this market, we have suffered from only being a mobile player. Because more than in a B2C segment, we have a much more dialogue based on the fact that you select your operator based on capabilities, not just based on this and that product.
Just simply by the fact that we can go to the customers, and we could do that the week after we've signed the deal, and talk about that value proposition before we started to do any integration, just from this kind of interaction, this kind of sales interaction with the customers. We set out on a journey then to drive loyalty and to build the brands. We rebranded from TDC to Telia. It's not just a rebranding of TDC, it's actually building a B2B brand in Norway, making Telia brand also a B2B brand, which we haven't been. It has been limited since we only have had mobile position.
As a part of that, we also launched not just to larger customers, but to the SME segment, a secure product, and where we also then can supply connectivity across a DSL line and 4G, and the customer doesn't know which one they use. That's a concrete example of convergence. We are working hard on realizing products, additional ICT products as a part of Telia Company. IoT is a good example. Magnus mentioned ACE earlier with contact centers, which is cloud-based solutions that we can implement in Norway and go out in the market right away, and we do that. When the railroad system asks for understanding how they should deploy their railroad network in the future and in the cities, we are then supplying crowd analytics as an example, based on insight then from Division X.
It works both ways. It's not only the standalone revenue, it's also the fact that we can have those kind of capabilities. We can go out and be relevant in the pure connectivity. That dynamics is more evident in the B2B segment. It's both building upon when you have connectivity, but it's also the other way around. It's the ticket into become relevant for delivering the core services in the B2B segment. We feel, if I try to pull that up again, we're definitely set out on the growth journey. We've historically based on finding the balance between both a stable business, the stable business driven from as a dilemma, or not a dilemma, but carefully managing both customer development on the one side, and ARPU development on the other side. Because we're so concerned in maintaining the Norwegian market as an attractive market.
We've grown through the M&A. We see definitely possibilities to capitalize on our network, because we do have a great network. We have a much better upside long term on the brand-building since we are so new into the market. We're well-known, but we need to make more tangible known for something, and that's a long-term journey. In the B2B segment, we definitely have a big opportunity because the incumbent is way too big, and we have definitely start to get the capabilities and now also the position to do so. In the B2C market, we see the growth opportunity linked to the convergence journey. As I've said, that we have also targeted as SEK 300 million in revenues. Before I come to conclusion, I mentioned the synergies linked to GET TDC. That's only a part of our total cost program.
We've targeted SEK 600 million in net cost OpEx reduction, whereby the synergies constitutes half of it. The rest half is the agenda that I've been discussing linked to our digitalization, changing business models, working on the processes, and the different elements that I've covered throughout my presentation. On top of that, we will then also have an upside link to the COGS and also the property cost, because this is OpEx and the OpEx part. Summing up, we are convinced that Norway has been and will continue to be an interesting market. We're well-positioned. We're building a fully integrated company in Norway very fast.
We like to, and we are driving this kind of agile, this type of challenger speed in terms of operating. We're promising value deliverables linked on our ability to act fast. We are building brand based on our great network. The convergence market in Norway is immature. We are well-positioned to take a part of that in combination with focus on a pretty ambitious cost agenda. We know what to do. We have built capabilities. We have leaderships in place, but we're humble enough to understand that there's a lot to do. Then we're eager to start doing it. Thank you.
Thank you very much, Abraham. Please take a seat. As you understand, we as Telia Company, we're a true Nordic citizen. We have a Norwegian anchorman in Finland being our CEO, Stein-Erik Vellan of Finland. Welcome.
Okay. Okay. How to do this? Last man out. I only got 20 minutes. Please pay attention. I need to do this a little bit quick because I have so much to talk about in Finland. Okay? To start off, you're in for a treat because here comes the happiest country in the world, Finland. We are, I can tell you. I wanted to use that as a little bit of a start because maybe sometimes you need to look at what kind of energy is in a company as well as the financials. I can tell you one thing. I've been working all around the world, in various countries. This is by far the coolest place I've worked, and I have to use that word as a starting.
As a backdrop, I have to talk to you a little bit about the market. Finland is different than the other markets that Telia is operating in, and I will give you a little bit of the reasoning behind this one, and then take you into the fact that over the last two years, we have done convergence. We have built convergence, and we have tried to build the organization around this. Finally, of course, not allowed to leave the room before I talk about cost efficiency with you guys. That will happen. Finland then as a market. If you remember some years ago where the rest of the world said, "Hey, let's go unlimited on SMS and voice," because that started to be a marginal business in a way.
Finland had this brilliant idea of going the other way and said, "Yes, let's rather go unlimited on data." That has colored the market, but not only on the mobile side but also in other areas. For instance, when Anders is talking about fiber penetrations, which are out of this world for Finland, we have a 7% SDU fiber penetration in Finland currently. I will get back to this a little bit because we have found some ways of addressing this one as well. Moreover, the average unlimited subscriptions in the market are 80%. This is one of these things we looked at. We saw our own portfolio. We are 63%. That is an upside. That is a possibility that we currently are utilizing.
Not only is the load then in our networks a little bit different than from our competitors, because taking these numbers, you can also derive in the following way that our competitors are closer to 84%-85%, whereas we are 63% because the average is 80%. There is an upside there also for us upselling. Having this 16 GB average as the data consumption, that is by far the highest in the world. On the offset, the Finnish market looks like a sort of stable three-player market. In many ways it is. Now, these numbers will be a little bit tilted by the fact that DNA acquired Moi right before Christmas. The playing field will be just about the same because Moi was an MNO for DNA prior to this, so it comes into their portfolio anyway.
What you don't see is a little bit or I have a phrase about the Finnish market, is that what you don't see is what you get. Meaning that the BTL activities are extreme in the Finnish market. I saw a report half a year ago from one of you guys that I thought was brilliant. To understand the Finnish market, the analysts had gone out and done mystery shopping. Do that, because then suddenly you see that the whole playing field in Finland is quite different also. On top of that is what is driving the high churn in the market. Having a peak in 2017, about 20% churn, it has now come somewhat down. Obviously driven by the fact that we see a lot of less dual SIM-ers, multi SIM-ers disappearing from the market. It is still at a high level. That is for the single subscriptions.
When we looked at all this, we came together with a plan, and that is about two years ago. By the way, it is about exactly two years since we rebranded Sonera to Telia. In a matter of months, the Telia brand was more recognized than the Sonera brand. Which I think was quite good, given the fact that the old Tele Finland company was established in 1855. Yes, there is a little bit of history in the walls there as well. Building also on the fact that we have acquired six companies over the last two years, and I will get more into certain of them, and also taken on the ice hockey rights. That is one part of a game that sort of puts us into the convergence and how to then go for ICT market in the B2B and the content in the B2C.
At the same time also, looking at other ways to be attractive in the market and defending the price premium that we had. We saw that sustainability is one of those areas that we really have to put a lot of emphasis in. We have the biggest example of a sustainable product in the market. We have the Helsinki data center. This is then awarded to be by far the greenest data center in the Nordics. For instance, when up and running, we save more than 70,000 tons of CO2 emissions just because it is just renewable energy. We capture more than 90% of the wastewater, reuses it in the data center, and on top of that, I get a little bit excited about this because it is really fun to talk about this to our customers as well.
When the center is really up and running, fully loaded, 10,000 houses in the Espoo area, and the greater Helsinki is made up of three areas, Vantaa, Helsinki, and Espoo. Espoo, 10,000 houses will be heated by the excess heat. It is truly a smart cement block in a way, and it works. It also works in the way that we are thinking going into the future, because here we of course, are transforming all our data, et cetera, and then can utilize this for data and analytics into the future when we are more and more digitalized. That is the whole thinking behind the direction we went into. Yes, of course, I have a separate slide on the ice hockey. Do not worry, we will talk about that as well.
In the consumer segment, to talk about the convergence, we saw that we had quite a strong position when it comes to several of the quality parameters for our customers. To build on that, we try to define then the loyalty. Just as Abraham and Anders have talked about, the moment we looked at customers that had more than one service from us, the churn rate dropped dramatically. This is what we have been then trying to work on and then introducing the ARPA going forward. You see that the moment we have two+ services with a customer, it goes from about just below 20% to 4.5%. Obviously, this is a smart thing to do. That means also that we can spend a lot of more time on upselling on the existing customers than trying to defend and keep customers that are churning.
That's why the ARPA came about, and we wanted to then try to build this convergence around the content. We went into a six-year deal with the Finnish Ice Hockey Liiga. We did something else. If you guys do not hear any of the telcos talk about e-sports, challenge them. Fastest-growing industry probably connected to our business. Low latency, ping, you name it, they want it. On top of that is going mobile. We believe it was stationary before, but it's right into the center of our business, and it's growing so fast you wouldn't believe it. Capture that opportunity. We have, within two months of starting, we became the biggest ASUS reseller in Finland just by capitalizing on our position. Then we moved into owning Assembly, which is the biggest e-sport gathering in Finland.
Right now, we do see that it will be in the middle of what we say in the consumer market will be our home positioning, and to utilize that. I mentioned also this thing about fiber. Connecting fiber in Finland, quite difficult, high cost. The government has said that every electricity company needs to put their electricity cables in the ground, and then at the same time, they can also then put fiber in there. We have made a deal with Caruna, the biggest electricity company in Finland, that when they deploy electricity cables in the ground, they also deploy Telia fiber next to it. We have made another agreement with the second biggest company called Elenia, and with them, we simply put our services on top of their fiber and still get the connectivity.
Thinking creatively, we will then get that sort of access to the homes in a much cheaper way. I need to move on because of time. No Finn do any sports without a helmet, okay? You need a helmet to do sports. That's why there's ice hockey, and then there's nothing, and then there's nothing, and then there's Formula 1. You almost have a helmet there. The attention around this area is so great. This is a six-year journey for us, and that's of course, part of a learning journey as well. The good thing is that this Monday morning, we reached or we surpassed the goals of the business case for the number of customers for the Liiga. We passed 90,000 active customers. We have more than 138,000 gross customers.
Just to give you a little bit of a feel for what's the difference is that we sell one-day passes, for instance. If you have a one-day pass and you don't renew it, then you are a gross customer. That gives us close to 45,000 customers that we can constantly do marketing up against and try to pull them back into the game. Right now, we are sort of surfing on the fact that the playoff started last Thursday. Attention is high, drive is high. We now need to convince our customers that they should stay on the moment their team is kicked out of the playoffs. We have, of course, packages and ways of doing that as well.
All in all, great learning, interesting learning, because we thought that we would sell most of these packages in our shops retail, and ended up by selling way much more online. That drove the SAC down, but also we need to work on the access rate as an upsell on the same customer base. The first year has started well, but it's a long journey. I guess you've seen that the general ARPU level in Finland has constantly been on the rise. We will continue to also try to develop our ARPU. As an example, just this year so far in the consumer segment, we have raised our prices by EUR 20.4 million. We will keep on doing that.
We do it continuously in the enterprise market, and I'll get a little bit more back to that when I hit the enterprise market later on. But we have to be innovative. The latest thing we have done, we have launched a completely digital subscription, meaning that with a really low SAC, you can only buy it online. There is no way to get it in our stores or anything else. It's one of the ways that we want to meet the eSIM that is here right now. Companies need to have an eSIM strategy because eSIM is here already. This is our way to meet it. That's in the market. Currently only about 7,000 customers running at the same average ARPU as we have for all our other subscriptions. It kind of works.
In the B2B segment, we have a convergence strategy that takes us towards the ICT market, or we are in the ICT market. We are by far the market leader in the enterprise segment, in Finland, as you can see on the blue left-hand side. We have over the last years acquired several ICT companies to give us a full portfolio of services to bring out to the market. It's very clear that the bigger companies say the following, "We want one contract, we want one service manager, one service level, one single point of billing, et cetera, and we want that from one vendor." We have been able to put all this together, and the proof point of it is the recent contracts we have signed with ABB, Nordea, Finnair, and YIT, which are four of the major, bigger companies in Finland.
We'll keep on developing this because on the back end of Magnus' new operating model, we will be able to do this even better into the enterprise segment. Hence, I definitely see that we will defend our number one position in the Finnish market. This is what one hasn't talked much about, 5G. It's here. It's an opportunity. There is simply no way that we will do any kind of 5G pilots or whatever this year without it being founded on a solid business case. That's what we have done so far. In the consumer segment, we have launched fixed wireless access. It is launched on a technology that, which is 5G, but just as Magnus said, it's still being carried by 4G. We do that in areas where we do substitution because we are closing down our POTS network as well.
This is one of the substitute products that we can bring into the market. We did another thing. In this Assembly, we set up a tournament trying to figure out what sort of best way to do this. You know you will get all the kids 16-17 years, right? Instead, we put it up a tournament with guys like you, 40-50-year-old men come and play. We had to turn down so many of them. It was even so interesting because this was then based on 5G technology. We got South Korea coming and filming us in Finland, on how we did this. Of course, that created a lot of attention. Again, we sold a lot of products and accesses, and hence it's a business case.
Moving on to the enterprise segment, we have in the port of Oulu, we have supplied 35 companies with 5G technology for logistics in the harbor. One of them being Stora Enso is running on that currently, and being paid by them. Finally, when some of you fly back and you are in the airport at Vantaa Helsinki Airport, you might meet that guy over there. This is one of those things you also can do because this is clearly a business case. It started as a discussion with Finavia how to improve security at the airport based on 5G. Helsinki Airport was the first airport in the world that got 5G through Telia. This robot was introduced. We found out that he can do two things. He can both do security surveillance, of course, but he's also service-minded.
If there are queues at the restaurant, he can come over there and talk to you in several different languages, that you should move to another one, which is closer, or if there are delays, et cetera. Multi-use of this robot on a 5G technology. Here's where I'm really proud of the organization. I work with fantastic people. We have done the rebranding of the company, the building of a huge data center on time, on cost. We have acquired a lot of companies. We have moved into the content area. We are moving to a new head office in a year's time. We are competing in the market, but at the same time, we have delivered on our cost targets. We actually delivered above our cost targets.
I have currently a group of 20 people from all around the organization, part-time into my cost program. We used it last year. We take the same program this year. We lifted our targets for this year because it's very natural, and I'm not saying this just because the CFO is here, but we need to treat cost in the same way as we treat revenue. That's the only way we can stay competitive. It's sort of a natural part of running the business that's looking at any type of cost. I have those 20 people running around being proud of finding areas where we can drive out cost of the organization. That stays us competitive all the time. We are using sourcing, so year-over-year, I have just about a 35% reduction in external consultants.
I'll keep on doing that because I have the brains in the company. Is it better when the manager says that, "You know what? I believe in you guys who work here. I don't need anybody external coming in." We are able to run this company in a good enough way. Of course, robotics. This year, we will take out about EUR 8 million in cost from robotics, from the use of robotics, we will sell an equal amount to all the customers that are asking us for robotic services. Of course, also, we will then be joining the new operating model. I have exactly nine seconds left. Summing up is right there. I think I will stay here in case there are any questions after that happy presentation. Thank you very much.
Thank you, Stein-Erik. Speaking of helmets, the way you danced around here, I would recommend you to get some helmets in case you fall down.
Okay. I don't fall, but they might get dizzy by looking at me. Yeah.
We do it this way. We take 10 minutes of questions to the esteemed gentleman to my left. I will see Johanna.
Yes. Johanna Ahlqvist from SEB. Question to all three of you, really, related to convergence. First of all, if you can comment if there is possible to get all services on one invoice as of now? The second question, you mentioned, I think, Abraham, that you have 10% of the base have converged offers today. What is your target, say, the coming two years in the different countries? How big part of your base can go on converged offers? Thirdly, even if you don't give any discounts, what is the key incentive to go on a converged offer?
I take first, you take the third one.
Yeah.
Yeah. We just ask good colleagues. We found out that the first one I can take, the second one is for Abraham, the third one is Anders. Is that okay with you? Yes?
It was planted.
Because the first one is so simple. Yes, you can get one bill in the enterprise segment in Finland. No, you cannot get it in the consumer segment, but you will get it within five to six months.
On the target side, we have set out internal target of roughly 25% of our customer base in 2022. That's now I'm talking for Norway. We will, of course, learn as we develop the capabilities because we haven't really started yet on the B2C side, but that's the target.
The last one was about what triggers the customers to choose. We are not going into the discounting race. For us, that is either that you're getting a higher tier on the mobile or that you're getting higher speed on the fixed, and that's entirely standard way that we have across the markets.
I can add that that will be applicable also for Norway. It's not just for Sweden. That's the strategic approach.
Over here, we have Thank you.
Hi, this is Avrash from Berenberg. Thanks for taking my questions. I've got two, please, one on Sweden and one on Finland. First, just coming back to Swedish fixed line price rises. I was just wondering, given that's clearly an important part of EBITDA growth, I guess. How sustainable do you think these are on a sort of multi-year basis? Do you see a need to put in price rises across a broader range of tariff, say, across your DSL base, for example? A second one on Finland. You've obviously made significant investments in ICT and in content. Of the back of these, do you see yourself winning a revenue share in the next, say, two to three years? Thanks.
In terms of price sensors for fixed, we are doing a fairly big increase here on the fixed as of next week. That, though, has come out fairly good in general. We are feeling that was the right decision to do. Over time, yes, we are, of course, have an intention to be able to grow revenues. There's a balance, a business case-driven approach all the time when you do price adjustments, but we feel that the decision of doing this price adjustment was the right thing to do. Also, thank you for a very good question. I was a little bit too quick on the ICT area in the enterprise segment. I think I understood you right when you said that we have done, because we are not going to do any more investments or there's no one planned in the enterprise segment or ICT segment.
We have that complete portfolio. Obviously, there are many reasons for doing these strategic choices. One of them is that the ICT market in Finland is growing by 12%. Another one is that it's very clear that ICT and our core connectivity is linked, because you cannot go into a security area without getting connectivity as part of it, and this is what we see that the customers are asking for. Obviously, we both want to take part of a 12% growing market on an ICT, but equally much, we want to defend our core telco connectivity products in the market, and we want to grow them. Yes, we are doing this to grow in both those two segments. Moreover, also to really strongly position ourselves as the number one player in the Finnish ICT market. Kevin? Thank you.
Thank you. It's Kevin from Deutsche Bank. Can you talk a little bit about what you expect in terms of content cost increase over the next two to three years you saw in 2018 across your markets? Also when passing on these cost increase to consumers, how concerned are you about OTT risks or spin down risks? Thank you.
If I should start with the Swedish market, we are not feeling a pressure right now on the content cost in Sweden. We don't see that as being a substantial issue for us. We had a cost increase of the last year in Sweden on content, but that's predominantly because we added HBO on one of our main packages, and right now we don't see a reason for being afraid of that going forward.
In Norway, we're not concerned with that for the next upcoming period, year and a half. There will be union negotiations, as we all know, that's a part of the routine. We have been able to package the content in such a way that we, for instance, we've developed a point system so that the different customer can select what kind of content they want, and that's a way also to both make the value proposition better relevant for the customer, as well as managing the cost side. On the content side, we're definitely managing also the price position compared to what the competition is doing. On the broadband side, we're more comfortable. For instance, in March, we've also implemented a cost increase on the broadband side.
For Finland, we are pretty much in the same area as Anders said, except for one thing, that we have content to sell. Mainly then from the Assembly, we already see the interest of others to buy the access to this kind of content.
Also to the recent esports tournament that we launched in Finland, that is reaching out. I know I'm talking a lot about this, believe me, this is a bigger industry than sports in general right now. It's maybe a balanced view on it. Frank?
Frank Maaø from DNB. I have a question to you, all three of you, actually, on 5G. We've seen Finland here, Stein-Erik, you're giving some good examples from what's going on in Finland there on 5G. Whereas we didn't really hear much about that in Norway at all, and a little bit about fixed wireless access playing a role in Sweden. Could you talk a little bit about why that is and why Finland is kind of ahead of the game here, and why you guys haven't talked about 5G at all.
Also with respect to what Magnus was saying about the potential coverage issues of not having standalone, the low band coverage issues in 5G and so on. Do you have the spectrum portfolio outlook in place early enough? Or is that coming, for instance, in Norway, is spectrum expected too late? Is that part of the reason? If you could talk a little bit about that. Thanks.
I can start from a Sweden perspective. When launching 5G, you need to have three different things. You need to have the stabilization of the technology, you need to have the devices, and you need to have the spectrum. Those are the things that determine when you can launch and how fast you can roll it out. The Sweden specific case is that we don't have the spectrum. The main spectrum for 5G, as already talked about, is the 3.5 GHz spectrum. Auction of that will be in December this year, we're expecting, and available from basically the month after. However, not having a commercial spectrum in 5G in Sweden, I'm very pleased about the position we have taken in 5G in Sweden, and I could speak hours about the things that have been done in Sweden up to now.
Whereas of the latest is two weeks ago, where we were launching the first industrial 5G network in Sweden, together with one of our main partners in that and Volvo Construction Equipment. We are doing a lot of different things, both in the mining industry and the construction industry. I clearly feel that we're taking the 5G flag in Sweden, with very limited CapEx and doing a very good way, even though we don't have the commercial licenses in place.
Should I take the opposite and then you can round it off, Abraham? Is that okay?
Yeah.
We have spectrum. This is one of the reasons why we have been able to be a little bit more forward-leaning on it. We have good partners, obviously through Nokia, that has been helping us to run the pilots. Again, also, the Finnish government has been quite resistant on them wanting to be a forerunner in the Nordics when it comes to 5G deployment. That's why also a lot of businesses are interested in running pilots and paying for them. They have to pay for them. Otherwise, it's not a business case. I think that's a little bit of the answer to your question about the differences in the markets.
We clearly have a 5G strategy throughout the whole company. It's important to note that in this area, we were definitely looking across the different markets. Whatever we do on business case learning and pilot learnings from the different markets, we definitely have this fertilization across the borders. We have a pilot in Norway. I didn't mention it here, but we're having launched the first 5G movie, actually, in Norway last year. There is a number of customer cases on the B2B segment.
There's definitely B2B segment that we're focusing on. There's a number of dialogues with the different customers. As with the rest of the world, we're still in the positioning phase. We're still in a pilot phase. We're still having the first initial commercial, but this is not the major driver now. This is coincidence that we're not having more visibility to the pilots in Norway. That doesn't reflect any of the sort of underlying ongoing.
Very good. I'll have to close you up there and leave the floor to Johan, that will come back and give some closing remarks, and then we have a few minutes left for Q&A after that as well.
Thank you very much. We're getting towards the end. You're still very engaged. That's great. I hope it has come through how excited we are about our markets and the opportunities that we have in all our countries, actually, but now the three big ones on stage. Two things that I picked up listening. The conviction we have around convergence, I hope, is very clear in all our presentations. In the countries, we see great opportunities in differentiation around convergence, both B2C and B2B. I also feel the commitment around costs and cash flow coming through all our presentations today. Those are key messages that we really want to hammer in to you. My closing remarks are merely a summary and wrap-up of we have been talking about.
The main message is that we are very committed and comfortable on our 12-12.5 cash flow for the year, and that is to sustain and grow over the years to come. That is in spite the Q1, which is weak as we guided you on in Q4, and we also clarified further today in our three markets. Very comfortable around that. The second thing, obviously, our commitments around the SDGs, primarily today upping our ambitions around the climate and our daring goals to become zero CO2, and with zero waste and 100% engagement into our ecosystem and partners.
Magnus gave you a good view of our operating model and the benefits that we have, not just for costs and scale, but also in terms of letting the countries operate out of standards, being faster to market, which also have benefits coming, which we have not yet quantified for you, but we will over the years to come. Christian very clearly laid out the 2% net OpEx reductions over the next three years, which we are also comfortable with. Of course, we will always look for more, but this is the commitment we're making here and now. Anders gave you the backdrop of the declining legacy, which is tough. In spite of that, Sweden is doing well in major segments, in major product areas, and is committed to turning the EBITDA trend in 2020. I hope you felt that and take comfort in that.
The synergy upping in Norway from the deal with GET TDC is the first revision now as we have gotten our hands around the business. Adding to the SEK 800 number, Abraham also pointed out the additional upside we have on working capital the first two year, but also slightly higher integration cost. Then Finland lastly, with the happy Stein-Erik showing a lot of proof points on our convergence B2B, B2C and more to come. We are definitely set up to compete even better in the Finnish space. With that, I think we are wrapping it, and I will ask Christian to join me as well as maybe Andreas and Åsa, I'm not sure. But please join, so we have at least 20 minutes or 15-20 minutes for Q&As to us, but also to the rest of the team if you want. Nick.
Thanks, Andreas. It's Nick Lyall from SocGen. Just going back to Bonnier, please, Johan, if possible. Very interesting presentation about Finland and ice hockey there, which shows it seems that exclusive sports rights and spending a lot on sports rights can possibly work, it seems in the presentation. How does Bonnier fit into that? Is Bonnier going to be the next vehicle? You've lost a lot of sports rights to MTG, or not you, Bonnier has. Under your stewardship, do you think Bonnier is a vehicle to buy much more sports and shove in much more production cost, or is there something else I'm missing about exclusivity there? Thank you.
We will clearly get back to more leveraging the Bonnier company and acquisition once we have it completed. The shape of the Bonnier business today, key message is that they are not dependent on sports rights only. They are much more balanced in their content portfolio than a sports right only company. Losing one right one year doesn't impact the business model in the long run and in the medium run for Bonnier as they trade today.
Let's see when we get in, how we develop our content play around sports over the years to come. A lot of good learnings we have definitely from the Finnish side, where we're, as Stein-Erik pointed out, hitting the business case on the standalone, and also now stepping up the synergy part of that deal, which is obviously the purpose, to spread it into the access portfolio. Getting more customers to step up the convergence stairs, which we talked about earlier.
Ulrich.
Thanks very much. I had a question to Mr. Olsson, actually, if that's all right.
Magnus?
There was a
Yeah, Anders. Oh, Anders, sorry.
Yeah, there was a pretty abrupt change in the Swedish management team. That was halfway into a program that you presented at the last Capital Markets Day. The question is this. You came in in May last year, and sort of took over, looked what you saw, and decided what you want to change. What would you say are the top three things where you thought that the Swedish operation needed to change and you really would like to sort of put your name to that, and that's the bit that's your contribution to the Swedish operation now as you're outlining the overall case? Because I wasn't entirely sure from the presentation where the main focus is, where you really want to change things in Sweden.
Right. Starting point, it's not me running Telia Sweden by myself. We have an organization of 5,000 very good people, and together we are running that. That's the starting point. I would say one of the things that I maybe brought in is to see how we can clearly position ourself as the quality leader, and taking the starting point in that in our convergence story. Not having said that that is not being the foundation all the time of Telia Sweden. Maybe take a stronger position on that, also how we communicate externally. One example of that is that we have launched a new communication concept recently, which we will consistently over time try to position ourselves that we are the undisputed quality leader in the Swedish market. That's it. Yeah.
In the front here, we have Maurice and Andrew.
Thanks. I thought you just accurately went through and clearly went through how you can tweak and improve returns from below service, from below revenues. The management teams here laid out confidence in market growth and in Telia's positioning in those markets, which should give us confidence in certain revenue growth. We've seen this weakening as you talk about in the first quarter, and I think you went through why that's happened in Sweden.
I think we understand why that's happened in Sweden, legacy pressure and where are you just getting a re-ignition in price rises. I wonder if you could just give us a bit more color on what's going wrong in those other markets and why we're at a trough, maybe, in the first quarter in terms of trends, given the market in general has been, as any investment market, has been pretty wary of management teams declaring troughs across the sector in the past few months.
We're not going to give you the Q1 presentation here now. That's coming in a month or so. As Christian pointed out, there's also the comparables that we have year-over-year that is different in market by market. That's one consideration. The other point is that it's fairly stable EBITDA absolute trading. It's not like the EBITDA is up and down in a volatile manner. It is the growth rates that are varying, and that's why we say it's slightly below the growth rate for Q4 on comparable basis.
The big question is still how do we fight enough and win enough in the market to regain growth across segments? We have some weakness in some of the larger segments that we have been talking about. No big surprise. You say, "What's gone wrong?" There's nothing going wrong in that sense. It's not just that we have higher ambitions for the growth agenda in both Finland and Norway and Sweden, that's yet to kick into its full potential. That's the overall answer. We'll go into the details after Q1.
Maurice.
Yeah. Maurice here. Question really on sharing models and the right infrastructure to own for the coming years ahead. If I'm not wrong, you pursue active network sharing across many of your markets. You have quite established models, and that's what's driven some of the higher return on capital we see in the Nordic markets compared to other parts of Europe. I guess, should we expect to see more sharing of infrastructure moving forward, whether it's on the mobile or the fixed side than you currently have? What's worked well? What hasn't worked so well? Linked to that, which infrastructures do you have which maybe you think are or aren't core? I mean, are towers important? Is maintaining your own network important? What's crucial for driving that differentiation forward?
Yeah, Maurice. I think it's a good question in terms of how we utilize our balance sheet and the capital management going forward. On the passive side, we're not in love with passive assets just for the sake of it. It needs to be good reasons to have passive in order to keep it. On the active side, as you said, we have a couple of good examples of sharing, both in Denmark, in Finland, and in Sweden, which we have learned from and are learning from. In the next wave now and next phase, we will definitely make sure that we make the right capital allocation decisions around our networks, and we are set up for that.
We have prepared ourselves for that. Over the last two years, there's been projects going on in the major countries to consolidate assets into, for example, tower cos, separate asset management in those companies. That's prepared for, but no decisions yet made on how and when we will execute on a certain part of that. Maybe you want to add something, Christian, on the note of capital deployment.
Yeah, I just want to also make sure with also the accounting rules and other things, you just don't sell towers and then get it back on your balance sheet anyway. You need to figure out if there is a true gain before you do it in the way you want to do it. I think another example showing that the path may be different than we thought historically is what Stein-Erik talked about. In fiber, you can actually do different things in different areas, different regional areas to find the capital efficiency that you need. In some places, we will build fiber ourselves. Some places, we will build it together with the electricity company. In some other places, maybe with another operator in the end.
We take Stefan, then we have Lena in the back after that.
Stefan Gauffin from DNB. I have two questions, one posed to Abraham Foss and one for Stein-Erik. The first one relates to the Norwegian market, where much of the presentation was related to Telia trying to gain market share from Telenor. There's a third entrant in the market, ICE, which actually has been taking more market share from Telia than from Telenor recently. Just your view on your relative performance and how you're going to improve that. The second question was relating to these electricity companies rolling out fiber. If you can give some more details on what kind of footprint you can get from that in Finland. Thank you.
Regarding the mobile market in Norway, it's correct that ICE is the third operator. They've been working for now for several years. They have roughly 7% market share, so it's relatively limited. They are also a part of our network, so it's also a part of our wholesale revenues. That's one side of it. We are also, by definition, more exposed than Telenor because ICE is also riding on our network. That's also communication-wise out in the market, the way they also position themselves. Clearly the main competitor for us in Norway is Telenor. ICE is coming in and being aggressive, but clearly Telenor is the main competitor. We've also seen some other consolidations lately.
There has been some other price pressures from MVNOs. One of them was acquired by ICE, which is good because it's good from a competition point of view in retail. Now I'm talking about from an investor point of view. It's good also for our wholesale revenues. That also is interesting dynamics in that context. We're fairly comfortable that we are set up to develop our brand position and brand portfolio in order to attack ICE with the tools that is necessary for ICE and the same for Telenor.
Just adding a bit. We have been talking to you about the Norwegian organic consumer business, where we said. We have been losing a bit, and we need to find a balance where we can start winning again. We're in that phase now, turning over the years to come, to also start winning in the consumer space. We have the brand rationalization, going from many brands into more focused brands, and that upside we have in front of us. That's just an addition to that. Thanks, Abraham. Yeah. Stein-Erik?
I really like your questions because this is yet another area where probably should have put a little bit more data into. In Finland, we have the MDU and the SDU market. As I said, the SDU market only is 7% penetration, whereas the MDUs are somewhere above 70%. In that area, it's much more competition. We signed, first of all, the agreement with Caruna, which is the largest electricity company in Finland. We are currently then rolling out some pilot tests on SDU deployment together with them. In general, I can say that the cost of deployment is under half of what it would have been if we do it ourselves. Currently, the estimate of the potential is about 30,000 households, which is quite a lot.
On the offset of that one that we're able to deploy in a lower cost, is that the percentage of customers actually connecting and buying the service will be somewhat lower than if we went out and sold it, knocking on doors, in a way. The total business case is much, much better. For Elenia, it's a little bit different. That's about 15,000 households. There, we only are then giving the service on top of the fiber. There, we are not the fiber owner, but actually then just deploying our services on top of it, which again, is equally attractive in a way.
Thank you. Lena, next question.
Yeah. Lena Österberg , Carnegie. There's been some articles in Swedish press lately regarding some politicians and parties wanting to potentially split up Telia into a services part and into a network part. As I was wondering what your thinking is on this, given that much of your brand and brand positioning is on network quality. Would you work as a separate services company if the government owns the network company? The second question is for Stein-Erik again, sorry. I'm wondering a little bit about the Liiga. Now we've got the customers, but the intention originally was also to cross-sell. I was wondering if you could share some experience on the cross-selling part from Liiga.
Thanks, Lena. I'll be brief on the first one. Of course, we note the discussion's ongoing. Regardless of those discussions, we have a view on our business model in our various markets and whether it is value creative, attractive or not to own assets or not, which are referring to my earlier question. In the Swedish operation, we definitely don't see that as an attractive model. We're happy to go into deeper discussions on that if and when needed. Stein-Erik.
Yeah. On the cross-sell, I think that you're mainly referring to the, in a way, upselling of access on existing customers. That has been a little bit of a tougher road to go down. We have also seen the learnings in how important it is to have that kind of product online as well. We didn't have that in the beginning. Now that we enter the playoffs, we have that product, we see then that we have almost doubled the % of access rate on the sold products. It is moving in the right direction. It should have been an even stronger access rate. As I also said, it's a six-year project, so some learnings you take as we go along.
Perfect. Thank you.
Perfect. Thank you. Henrik also had a question. For Stein-Erik, or
Thank you. It's Henrik Aslaksen from Credit Suisse. I had two questions, one on Norway and one on Sweden. Firstly, on Norway. I think Telenor has said that they've seen a slight customer preference for fiber and sort of overbuilding its cable networks in some areas. Just wondering what you're seeing in your current space. What are you seeing the same trends? If not, what do you think the difference is, really? On Sweden, I was just wondering on that 1.6 million, I think that was 1.6 million of homes where you hope you can build fiber or buy stuff or something. Just wondering if you have a smaller market share in those areas, and that if you get access to fiber in those areas, there's a potential to sort of grow your base. Thanks.
Regarding Norway and the overbuild, we've seen Telenor overbuilding certain areas. In some popular areas, we do see that, both in Telenor and also parts Altibox. We are in the middle of looking into how we then will roll the next phase of the fixed network. That's a part of the ongoing strategy project that we're doing now. Part of that is we will definitely also then upgrade parts of the network to DOCSIS 3.1, which is from a customer point of view, we're absolutely convinced that they will produce as good services as fiber.
It's not either/or, because there's also a question doing that. It's also then to extend fiber longer out in the existing network. It's not an either/or question. It is about building upon a strong network and then making it more resilient. I wouldn't say that the overbuild part is the biggest issue. What we see and what we're concerned with is to develop our network in such a way that we can deliver the customer service or the customer
The speed and the quality that we're convinced of. One note there, on the quality side, it's not just about network. It's also about what happens in the home, what happens through the setup boxes, what happens in the Wi-Fi zone or the 4G network at home. It's also an end-to-end assessment on the quality of the network, not just the fiber itself.
On Sweden, in terms of increasing the penetration and the reach. Recapping the numbers there. We have a potential of upselling of homes passed not connected of roughly 300,000, that is a journey that will be ongoing for a period of time. That is not happening automatically that you get that upsell. On top of that, the main thing is that we open up the universe of the Open City Networks. That we have now reached some 900,000 in the Open City Networks, where we have a very small portion of those still connected to our services. Over time, again, that will be a great opportunity to increase the penetration. The other part was the reach increase in the OCN reach more, then on mobile, both 4G and 5G.
Just follow up very quickly on Norway. It sounds like for Telenor it's more a brand issue than actually technology issue that customers don't want coax. It's just that there's a preference for stronger TV platform or whatever.
Well, I obviously can't speak for Telenor in what their specific case is. There could be several specific reasons why they do their different things. I will remain to the fact that we're absolutely convinced that we have a good network that we will develop further based on the hybrid network that we have, and that's also in general terms, the bulk of what Telenor is doing.
Thank you so much. That was what we had time for. You know there will be lunch outside. Please take the opportunity to grab the management team and ask questions through the lunch.
Yes, after the lunch, some of you have said beforehand that you want to join the exhibition upstairs. Please keep your badges on. You will be taken care of by English-speaking people up there if that's of interest to you. Some of you have also said that you wanted to join the entire afternoon. That will start at 1:00 P.M. upstairs. Yep.
Excellent. Well, thank you very much.
Thank you.