Access pricing for very high capacity networks in the European Union

28.08.2020

Introduction The European Commission (EC) has given a lot of attention to the matter of how access prices should be set so as to encourage investment in very high capacity networks whilst maintaining effective competition at the retail level. The guidelines developed in Europe provide a useful benchmark for regulators elsewhere, in particular for regulating the price of access to fibre of cable networks. The European Electronic Communications Code The Directive establishing the European Electronic Communications Code (EECC) was adopted by the European Parliament on December 11, 2018 (European Union 2018). The purpose of the EECC is to respond to…

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Changing the operating model: the creation of UNN in Brunei Darussalam

27.08.2020

Introduction Until 2019, the telecommunications industry structure in Brunei Darussalam was based on the traditional model of vertically integrated telecommunications providers (telcos) competing with each other, with Telekom Brunei Berhad (TelBru) the fixed incumbent, DST Communications Sdn Bhd (DST), and Progresif Cellular Sdn Bhd (Progresif) providing mobile services. Each telco largely offered services based on their own respective networks. Located on the island of Borneo, Brunei Darussalam relied on submarine cable networks managed by the Brunei International Gateway Sdn Bhd (BIG) for international connectivity. Brunei Darussalam has a relatively small population of about 420 000 inhabitants and has a correspondingly…

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Joint dominance

27.08.2020

Introduction On March 17, 2020, the Dutch Trade and Industry Appeals Tribunal, the highest administrative-law court in the Netherlands, reversed a market analysis decision by the Dutch telecoms regulator, the Authority for Consumers and Markets (ACM) which was based on a finding of joint dominance (ACM 2020). The case throws new light on the regulatory challenges associated with joint dominance and raises questions about the relevance of this concept in digital services markets. The ACM decision On 27 September 2018, the ACM published its analysis regarding the provision of wholesale access at a fixed location in the Netherlands (ACM 2018).…

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The regulation of price bundles

27.08.2020

Introduction According to research conducted by Ofcom in the United Kingdom (Ofcom 2020b: 22), U.K. customers make an average saving of 20-28 per cent, compared with purchasing the same services individually. Not surprisingly, these savings have led to 80 per cent of customers purchasing their electronic communication services in bundles,[1] but Ofcom also found (Ofcom 2020a: 19) that not all consumers are benefiting, with the 41 per cent of customers who do not recontract or switch provider at the end of their contract period missing out on the available savings. Price bundles are both a boon for customers and an…

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Iran tariff approval and notification procedures

27.08.2020

Introduction In 2016, after receiving advice from international consultants, the Communications Regulatory Authority (CRA) of Iran introduced comprehensive procedures for the filing of all telecommunications tariffs and for the review and approval of those tariffs that required specific approval. Prior to 2016, the CRA reviewed all tariff filings and subjected all filings to similar processes. The new procedure ensured that regulatory resources were directed to greater scrutiny of tariffs for services in markets where the operators had significant market power (SMP) and were not directed to the ex-ante examination of tariffs for services in markets that were considered to be…

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Red Compartida, Mexico

26.08.2020

Introduction One of the key issues that countries face as they migrate to the digital economy is to provide incentives for investment in the necessary broadband infrastructure. Some countries have adopted the model of a single, national broadband network. The example of Mexico is especially interesting as the Red Compartida (“shared network”) project is focused on delivering a national broadband mobile (4G-LTE and 5G) network. Why a shared network? Source: IFT. Mexico has never managed to achieve effective competition in telecommunications service provision. América Móvil has retained a market share of more than 60 per cent in the retail mobile…

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How the growth of data traffic affects interconnection charges

26.08.2020

The growth of data Source: Incyte Consulting Ltd. It is well known that data traffic has exploded in recent years while voice traffic has declined. This trend has been fuelled by over-the-top (OTT) applications taking traffic away from traditional voice services on fixed and mobile networks, by the increasing amount of Internet traffic and, most dramatically of all, by the explosion in video-based applications which now represents 73 per cent of all traffic (Cisco 2020). At the same time, the residual voice traffic has migrated from fixed to mobile networks. These trends have created a dramatic shift in traffic patterns,…

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The decline and fall of mobile termination rates in Europe

26.08.2020

Mobile termination rates in Europe Source: BEREC 2019. The figure above shows the evolution of (simple) average mobile termination rates in Europe. The average rates in Europe steadily decline from EUR 0.14 (January 2004) to EUR 0.0088 (January 2019), a cumulative decline of 93 per cent from the initial average rate. This article explores why such a dramatic fall in prices has occurred.[1] How mobile termination rates have been regulated Historically the common position among national regulatory authorities (NRAs) around the world is that the termination of voice calls to mobile customers is a separate market in which each mobile…

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Approach to market definition in a digital platform environment

26.08.2020

Introduction Market definition is both an economic concept and, in many jurisdictions, a legal requirement. It is a necessary precursor of a regulatory finding of dominance (or significant market power, SMP) and thus provides the starting point for determining whether ex ante[1] regulatory intervention is required within electronic communications markets. It is also the initial step for assessing anticompetitive behaviour and merger control within the remit of competition law. Competition authorities and courts are increasingly concerned with the market power achieved by the large digital platforms. Several countries have strengthened merger control rules and many abuse cases that involve digital…

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Market analysis in Moldova

26.08.2020

Introduction Moldova is a small and relatively poor country on the edge of Europe. It was created in 1991 after the break-up of the Soviet Union and is precariously balanced, politically, socially, and linguistically, between Russia and the European Union. Two thirds of Moldovans are ethnically Romanian, while the disputed industrial area of Trans-Dniester in the East is predominantly Russian speaking and has unilaterally declared its independence from Moldova. The delicate political situation in the country has led the government to follow a strategy of regulatory alignment with the EU, with the long-term goal of joining the EU; however, at…

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