EC WILL LET OPERATORS SHARE 3G ROLLOUT COSTS
European Commission (EC) intends to clear 3G sharing agreements between T-Mobile and mmO2 in U.K. and Germany, it said Tues. Commission said it anticipated significant cost savings from companies sharing network elements that would benefit consumers without limiting network competition. “Such cooperation can bring benefits for the consumer in terms of a faster introduction of new services, more competition and a lesser impact to the environment,” said Comr. Mario Monti, who is responsible for EU competition policy. Network sharing also should lead to greater network coverage, Commission said.
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Monti said Commission’s preliminary conclusion still was subject to 3rd-party comments, which are due Oct. 10. EC said agreements “are not exclusive and generally allow 3rd- party site sharing and national roaming subject to limited exceptions.” It said safeguards were in place to limit exchange of sensitive information between parties. “The Commission will remain vigilant to protect competition in mobile phone markets,” Monti said.
EC said most of European Union (EU) member states had given 3G mobile service and network providers licenses through auctions that put many of successful bidders in debt. Dow Jones Business News said European mobile phone operators spent more than 115 billion euros at auctions to buy 3G licenses. Deutsche Telecom has debt of 64 billion euros and BT Group PLC Pounds 13.4 billion.
Agreements filed by T-Mobile and mmO2 in Feb. for approval under competition rules relate to network sharing and national roaming for 3rd-generation global system for mobile communications (GSM) phones in U.K. and Germany. Companies were seeking either negative clearance under Article 81(1) of EC Treaty or exemption from cartel prohibition under Article 81(3). Network sharing is under discussion in several EU countries, and EC said it supported such arrangements provided that “there remains sufficient competition in the market to ensure that consumers have their fair share of benefits.” Monti said EC should give priority to notified cases and promised prompt final decision after 3rd-party comments were received.
Commission said it was first time it had to examine 3G network sharing agreements in light of EU competition rules. “This issue has been under discussion for a while,” said Anna Snow of EU’s Washington office. She said EC submitted document, “Towards the Full Rollout of Third-Generation Mobile Communications,” in June, discussing possibility of sharing network elements. Commission said it focused on effects network sharing could have on balance between network and service competition. T-Mobile and mmO2 have agreed to share sites and radio access network (RAN) and provide each other with national roaming facilities. However, EC said it reserved its position on RAN sharing until companies decided whether they would proceed with closer cooperation. Companies also agreed to keep separate their downstream consumer services.