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Flat-rate tariffs for telephony and (mobile) data have simplified many things. What used to be subject to fluctuations can now be easily calculated. This makes the telecommunications industry a defensive investment.
Much time has passed since the introduction of the first flat rate in the Swiss telecommunications market, but the new billing method has changed a lot. We remember that in 2005, the provider Orange introduced the first real mobile flat rate in Switzerland under the name "Orange-Maxima". It allowed unlimited calling to the Swiss landline network and to its own Orange mobile network. Swisscom followed in 2012 with a flat rate for unlimited surfing and calling to all networks. For heavy callers at the time, this was a blessing; for the domestic telecom market, it was a breakthrough into a new era. Gradually, the flat rate became standard; besides the landline, it also conquered the mobile market and internet access. Today, over 20 years later, the flat rate is omnipresent and offers flat-rate tariffs independent of time, volume, and access. For sum X, you can chat, message, and surf as much as you want.
Flat rates create predictability
This is not only a very convenient matter for the consumer, but it is also a fine thing for the telecommunications companies that offer flat rates. For what once depended on the whims and moods of consumers – after all, they do not always have a need for communication everywhere and at all times – becomes, thanks to monthly flat-rate tariffs, a fixed and calculable figure in the business numbers. This predictability is extremely helpful for budget planning, setting growth targets, and managing operating costs. Stable cash flows give companies the confidence to invest in product development, support, and customer success. This has a positive effect on customer satisfaction.
Additionally, flat rates help to reduce costs within the company. Individual itemized billing is eliminated in favor of a standardized fixed monthly fee. The error rate drops, customers are more satisfied, and support requests are reduced.
From cyclical to defensive
All of this has contributed to the originally cyclical telecommunications industry becoming a defensive one. What used to be subject to economic fluctuations is now classified by economic experts as being largely independent of the economic cycle. It is true that a defensive character was attributed to telecommunications even in earlier times – true to the motto "people always make phone calls, regardless of how the economy is doing" – but that is only partially correct. When the economy is not doing well, fewer calls are made, especially in the commercial sector. If costs are then billed per call, economic fluctuations certainly have an impact on the telecommunications companies.
More of a utility cost than a usage fee
But flat rates are not the only thing contributing to the stabilization of the telecommunications industry. The fact that today people do not just make phone calls, but that the permanent use of the internet is primarily in the foreground, also contributes to the increasingly defensive character of telecommunications. A contract is concluded via a provider that grants internet access. This is always there, regardless of how often one actually uses the internet in the end. Billing is usually done via a flat rate, meaning the costs correspond less to a usage fee and more to a kind of utility cost (ancillary cost), such as those frequently charged in rental apartments. Utility costs are incurred regardless of whether one is responsible for them or not.
Swisscom, Deutsche Telekom, and Vodafone
How popular flat rates are in Switzerland is shown, among other things, by a quick look at the statistics. According to the Federal Communications Commission "ComCom", market dynamics have been primarily driven by the subscription market for many years. In the process, numerous users have switched from prepaid offers to postpaid products. The proportion of customers with a subscription increased from 63 percent in 2015 to over 84 percent in 2024. Postpaid contracts almost always include flat rates, whereas this is not necessarily the case with prepaid.
The market leader in Switzerland regarding flat rates is Swisscom, with a share of over 50 percent in mobile communications. In Germany, it is Deutsche Telekom, which leads the market with around 28 million postpaid customers, followed by Vodafone with nearly 20 million postpaid contracts (as of Q1 2026).
This article constitutes marketing material pursuant to Article 68 of the Swiss Federal Act on Financial Services (FinSA) and is intended for informational purposes only. The information does not constitute an investment recommendation or advice and does not contain an offer, nor an invitation to submit an offer. Reproducing any part of this article in any form without our prior written permission is prohibited, except for the creation of a single copy or excerpt solely for personal, non‑commercial use.
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