Paris, 31 May 2005
Market situation
On the 14th of April, the Autorité de régulation des Communications Electroniques et des Postes (ARCEP, the former ART) submitted its analysis of the wholesale access and call origination market (market 15) to the European Commission and other European regulators.
In its analysis, ARCEP identified a slight decrease in competition and rising margins on the retail mobile telephony market in Metropolitan France since 2000-2001, despite the presence of a third operator since 1995.
The market has witnessed recent developments with the signature of several MVNO contracts since the analysis began. ARCEP is pleased with the recent opening of the wholesale market, but considers that, under current conditions, these agreements may not be sufficient to change the unsatisfactory situation of the retail market, since they do not appear to offer MVNOs sufficient long-term economic space for them to compete effectively on the retail market.
In its opinion number 05-A-09 dated 4 April 2005, France’s competition authority, the Conseil de la concurrence, states that it agrees with most of the observations made by ARCEP, as concerns both existing MVNO agreements and the situation of the retail market.
However, ARCEP does realise that since these agreements are currently being implemented and are subject to review, it is difficult to have a clear, forward-looking view of the degree of competition on the wholesale and retail markets for access and mobile call origination. As a result, it appears too early to conclude whether ex ante regulation is necessary or not on this market. This is why ARCEP indicated yesterday to the European Commission that it is suspending its analysis of market 15 and is withdrawing its draft decision.
Market supervision
In order to establish the effective impact of MVNO agreements on the retail market, ARCEP will monitor the mobile access and call origination market.
ARCEP will check that the recently signed MVNO contracts offer the MVNOs an opportunity for financial and commercial autonomy and that they are in a position to offer an expanded range of services. It will also evaluate the evolution of competition on the market, especially in terms of price and market share.
To do so, ARCEP will establish a quarterly report on the wholesale and retail access and mobile call origination markets in Metropolitan France which it will submit to the Commission. Part of the report, which will not include any individual data, will be made public.
Within the next month, ARCEP will send to the mobile operators and MVNO in Metropolitan France a first questionnaire for the third quarter 2005, which covers:
- MVNO agreements, their conditions of implementation and their evolution
- market share, gross and net, wholesale and retail
- various elements which show changes in price
Given the evolution of the access and mobile call origination market, ARCEP will submit a new analysis as requested by the Commission.
