I think this actually has something to do with why we pay so much for this kind of service in Canada. Our population is so thinly spread (other than a few major cities, who do have these cheap alternatives) that I bet if they even tried to cover second tier cities, they'd lose money. European countries have the advantage of being really small.
According to Wikipedia,Sweden has 20.6 people per square kilometer,compared to 3.4 in Canada. Also,Canada is slightly larger. Much easier to cover all (or most) of Sweden than Canada
Here's another stat to look at. Southern Ontario, roughly up to Algonquin Park, has around 12 million people on about 140,000 km^2. Sweden has around 9.5 million people on about 450,000 km^2. Going purely by area or density criteria, southern Ontario should have telecom service miles ahead of Sweden, even in towns that are tiny and remote by southern Ontario standards.
Sure, but you don't live in the middle of the Northwest Territories, and neither do the vast majority of Canadians complaining about telecom prices. The population density figure is a bit of a red herring.