New obligations for operators with significant market power in fixed networks

23/10/2008

PTS proposed new obligations today for operators with significant market power in fixed telephony networks. Among other things, it is proposed that Telia Sonera shall retain cost-oriented pricing when other operators wish to direct calls in the company's network. Also, Telia Sonera may be required to continue offering wholesale line rental. These proposals were submitted today for consultation with operators, who will have one month to express an opinion on them.

The proposed decisions entail obligations for the following product and service markets: fixed access to the public telephony network, fixed call origination and fixed call termination. Obligations have been imposed on these markets since 2004. The proposed obligations largely encompass the same areas as previously, with a key exception. The obligations previously imposed by PTS have contributed to improved competition in the electronic communications market. For this reason, PTS now proposes that the market for call transit should no longer be regulated.

PTS has identified Telia Sonera as an operator with significant market power in the three markets. So that consumers will be able to communicate with each other, PTS imposes obligations on operators in the market for call termination. Besides Telia Sonera, around 30 operators provide call termination services. So that operators will be able to offer services equivalent to those offered by Telia Sonera to its customers, PTS has imposed an obligation on Telia Sonera to provide other operators with access to its fixed telephony network in the form of wholesale line rental.

The obligations imposed by PTS are of great significance to operators in the market and are crucial for achieving the objectives of the Electronic Communications Act. An obligation to assist in the interconnection of networks is one example of a basic prerequisite to enable consumers, businesses and other organisations to communicate with each other.

“Through these obligations, PTS ensures that consumers will continue to have a good range of operators to choose from for fixed telephony services. We also ensure that operators cannot charge excessive prices for services sold to one another and which are a prerequisite for interconnection,” says Marianne Treschow, Director-General of PTS.

The final decisions for the following markets: fixed access to the public telephony network, fixed call origination and fixed call termination, are expected to be taken in March 2009. These decisions presuppose consultation with the European Commission and other regulatory authorities within the European Union, in addition to consultation with operators.

The current obligations affecting the market were imposed by PTS in 2004 and 2005. PTS is now implementing the second generation of market analyses and obligation decisions. This second round involves the analysis of seven sub-markets within the electronic communications market.

Read the proposal (only in Swedish)

For more information, please contact David Troëng, head of Competition Department, tel. 070-8617219.

The Swedish Post and Telecom Agency (PTS) monitors the electronic communications and postal sectors in Sweden. The term ‘electronic communications’ includes telephony, the Internet and radio. The Agency works with consumer and competition issues, efficient utilisation of resources and secure communications. Read more at www.pts.se.