EUROPEAN COMMISSION Reinald Krüger Competition DG 1 11èmes Entretiens de l´Autorité Mobile Economics, Paris, 26 March 2007 Cost Orientation and Asymmetric Pricing for Mobile Call Termination: National and European Stakes - A view from the Commission services -
EUROPEAN COMMISSION Reinald Krüger Competition DG 2 Overview n Art.7 notification process so far n Remedies n Specific comments made n Outlook
EUROPEAN COMMISSION Reinald Krüger Competition DG 3 Art.7 notification process so far n 25 NRAs notified market 16 –45 notifications, however, in total –e.g. FR and UK account for 5 notifications each n All defined market in line with Recommendation n All found that all MNOs have SMP n All imposed price control
EUROPEAN COMMISSION Reinald Krüger Competition DG 4 Remedies (1) n Quite heterogeneous over Member States –considerably different MTRs within EU –thus, regulatory outcome fragmented, despite consistent finding of SMP n Reasons for heterogeneity –costs of termination are different ? –approach to cost orientation different ? »different costing models »different glide paths
EUROPEAN COMMISSION Reinald Krüger Competition DG 5 Remedies (2) n average MTR of six large MS n as of 01/07/2006 n [€ cent/min] n source: ERG(06)59; MTR update snapshot
EUROPEAN COMMISSION Reinald Krüger Competition DG 6 Remedies (3) n Main Commission concerns –cost of calling for consumers and enterprises –unjustified lack of harmonisation n Reasons for concern –level of MTRs –glide path –(length of) asymmetric treatment of MNOs –MTRs left to private negotiations
EUROPEAN COMMISSION Reinald Krüger Competition DG 7 Specific comments made (1) n Glide path –path towards cost-oriented level not clearly specified –path too long –need to specify cost accounting methodology –implementing measures to be notified
EUROPEAN COMMISSION Reinald Krüger Competition DG 8 Specific comments made (2) n Asymmetric remedies –require adequate justification –might be justified by objective cost differences outside the control of MNOs concerned –need to monitor evolution of cost structures
EUROPEAN COMMISSION Reinald Krüger Competition DG 9 Outlook n Spectrum costs and the level of MTRs –value of licenses –current vs historical costs n How persistent are second mover disadvantages ? –differences in access to spectrum ? –proportionate and non-discriminatory rebalancing ? –network sharing ? n MTRs in national courts
EUROPEAN COMMISSION Reinald Krüger Competition DG 10 Thank you for your attention !