Competition Law and Market Integration in Electronic Communications Dr Pablo Ibanez Colomo London School of Economics

Transcription

1 Competition Law and Market Integration in Electronic Communications Dr Pablo Ibanez Colomo London School of Economics CERRE Expert Workshop Brussels, 24 October 2013

2 The vision of the Proposal The Proposal issued by the Commission in September conveys a clear vision: Integration of national markets to see the emergence of an EU-wide area Emergence of 4-5 big players across the whole of the EU 2

3 The vision of the Proposal How far are we from the vision? Can the instruments in place deliver? A look at market trends, segment by segment in the industry Mobile communications Cable industry Fixed broadband What is (and should be) the role of competition law in the process? Can the Proposal contribute significantly to achieve its goals? Is it necessary in the first place? 3

4 Mobile Communications A major feature of the Proposal (spectrum, licensing) Clear trend towards the emergence of EU-wide players Vodafone as the quintessential global operator Orange, Telefonica (O2) and T-Mobile emerging as continental players Hutchinson as a disruptive force Comparable market structures in all Member States: 3 (+1 or more mavericks) 4

5 Mobile Communications 5

6 Mobile Communications 6

7 Mobile Communications 7

8 Mobile Communications 8

9 Mobile Communications Competition law has not hindered the on-going trend The principles underlying intervention seem clear (T- Mobile/Orange, Hutchinson/Orange) Create the conditions in which a fourth player can remain/flourish Preference for infrastructure/spectrum-based competition over MVNO These principles will soon be put to test in Telefonica/KPN Further integration of national markets should ease, by definition, the objectives of the Proposal 9

10 Cable Operators The emergence of EU-wide players is a visible trend in the cable segment Consolidation of cable activities within national borders (accelerated since mid-2000s) Rise of Liberty Global as the pre-eminent cable operator of the EU (BE, DE, NL, DE, UK) Two features of the consolidation process Incumbent telcos not involved in the process Towards cross-technology consolidation, finally? (Vodafone/Kabel Deutschland; Numericable/SFR?) 10

11 Cable Operators In general, competition authorities have not raised any concerns to consolidation: Limited, or non-existent, geographic or material overlap Source of competitive pressure on incumbent telcos Major exception to this approach: Germany Based on peculiarities of the network architecture and in narrow market definitions the BKA has been strict Consequences on the degree of infrastructure-based competition 11

12 Cable Operators 12

13 Cable Operators 13

14 Cable Operators 14

15 Cable Operators 15

16 Cable Operators The position of cable operators is not addressed as such Focus on the conditions of service-based and not on infrastructure-based competition References to NGA networks seem to reflect a concern with incumbent telcos Indirect and positive effects on the position of cable and infrastructure-based competition Flexibility in the imposition of remedies in the Recommendation on non-discrimination References to cable as an imperfect constraint on incumbent telcos 16

17 Competition and consolidation between incumbents Competition between incumbent telcos in each other s domestic market seems limited Potential to achieve infrastructure-based competition Competition is mostly infrastructure-based when cable has a significant presence (BE, NL) In other Member States, alternative providers tend to be local players (FR, UK) Consolidation between major incumbent telcos is equally limited 17

18 Competition and consolidation between incumbents 18

19 Competition and consolidation between incumbents 19

20 Competition and consolidation between incumbents 20

21 Competition and consolidation between incumbents Several causes could account for the observed landscape in broadband The role of competition law in this context seems limited Consolidation would most probably be unproblematic or easy to address (as among cable operators) On the other hand, reluctance to compete seems equally unproblematic Establishing collusion virtually impossible (CISAC) Similar phenomenon in the US (Twombly) Little in the Proposal suggests that this trend can be changed (waiting for Vodafone?) 21