Croatian Telecommunications

Transcription

1 Croatian Telecommunications Agency Relevant Market Analysis Market 11 and Market 12 Tonko Obuljen Iva Ivanković

2 Broadband penetration rate (January 2005) % 18,97% 94% 15,58% 5,29% 17,94% 16% 18% 20% % 52% 0,20% 10,26% 10,29% 11,34% 14, % 14% 16% EU average 877% % 5,91% 8,12% 8,15% 8,25% 8,37% % 5% 8,20% 9, % 8% 10% 8,77% 0,47% 1,65% 2,43% 2,60% 3,27% 3,62% 0,96% 3,43% 3,75 0,52% 2% 4% 0% EL HR SK CZ LV CY PL IE HU LT SI IT ES LU PT DE MT AT EE UK FR FI SE BE DK NL

3 Broadband penetration rate (January 2006) 25,23% 24,72% % 22,37% 25% 30% % % 20,70% 2 19,25% 16,47% 16,43% 15,48% 3% 0% 20% EU average 12 8% % % 8% 9,85% 11,61% 11,68% 12,74% 12,80% 1 14,33 13,30 11,80% 83% 6% 10% 15% 12,8% 1,45% 2,66% 5,69% 6,14% 6,29% 6,78 2,48% 6,8 6,36 2,56% 5% 0% EL HR SK PL LV HU CY CZ IE LT SI PT ES IT MT DE EE AT LU FR UK BE SE FI DK NL

4 Broadband penetration rate (January 2007) 90% 27,10% 31,40% 31,80% 30% 35% %,40% 8,10% 18,40% 20,40% 21,50% 21,70% 22,40% 25,9 2 20% 25% EU average 90% 10,60% 12,50% 13,90% 14,00% 14,50% 15,20% 17, ,90% 12,30% 10,60% 10,50% 15% g 16,2% 5,20% 8,9 5,20% 4,40% 5,67% 5% 10% 0% EL PL SK HR CY HU LV LT CZ IE MT PT SI IT ES AT DE EE FR LU UK BE SE FI DK NI

5 Topics Legislative Framework Market Analysis s Procedure e Relevant Markets Definition Relevant Markets Analysis

6 Legislative and Regulatory Framework in Croatia Telecommunications Act (122/03, 158/03, 60/04, 70/05) Ordinances Croatian Telecommunications Agency (CTA) founded in September CTA Council 5 members CTA Administrative service 110 employees

7 Legislative and Regulatory Framework in Croatia Resolutions of CTA Council are final Appeals on the Administrative Court CTA authorized to perform all regulatory tasks Financial independence Data collection and site inspection Contracts with Competition Authority and State Statistics Institute

8 Legislative and Regulatory Framework in Croatia Concession agreement with HT replaced by individual licenses SMPs designated according to existing legislation Reference offers published (RIO and RUO) Access disputes Use of existing infrastructure (ducts and masts) Building capacity of the regulator

9 Legislative and Regulatory Framework in Croatia New law opportunities and threatst Transition period provisions Introduction of general authorization Strengthening of the right to issue fines telecommunication supervisors Possibility to issue ordinances

10 Legislative and Regulatory Framework in Croatia Market analysis Chapter VII of TA 4 markets defined Ordinance on the conditions and manner of determining relevant markets in telecommunications in accordance with the 2002 Regulatory Framework Possibility to use Ordinance, which defines 18 markets but only for analysis Remedies may be imposed only on predefined 4 markets

11 Legislative and Regulatory Framework in Croatia The Decision of the Agency Council - the procedure defined in the Article 5 paragraph 2 of the Ordinance shall in an adequate manner apply general principles from the Guidelines of the European Commission 2002/C 165/03 (OJ C 165/06, ) October 2006 the Government of the Republic of Croatia adopted the Strategy for the Development of Broadband Internet Access by the year 2008 and Implementation Action plan of that Strategy for the year 2007 The goal of the Strategy: the reduction of the gap between Croatia and EU countries regarding g broadband penetration rate Action plan defines continuous activities and individual measures to be conducted by the Government and national authorities by the end of 2007 for the purpose of achieving goals defined in the Strategy

12 Market Analysis Project Team CARDS Council Director Project Leader Engineer Lawyer Market Expert Iva Ivanković Market Expert

13 Market Analysis Procedure Making of Questionnaires Data Collection Delivered Data Analysis Relevant Markets Definition retail level wholesale level Relevant Markets Analysis Publishing of the Document Public Consultation

14 Making of Questionnaires defining broadband access technologies defining data needed for market definition and market analysis retail level wholesale level geographical coverage prices major costumers consultation with ERG/IRG members - their experience regarding making of questionnaires and market analysis comparison of their experience with our needs

15 Data Collection meetings with operators in order to define final content of the questionnaires defining the least download data speed that is considered to be broadband access capacity COCOM considers download speeds in excess of 144 kbps to be broadband access capacity sending Questionnaires to the operators 30 days period for delivering Questionnaires to the CTA

16 Delivered Data Analysis Total number of broadband access connections /1 2007/ Source: Questionnaires for Market 12; Data for 2004.g. :CTA Annual periodical report 2004.

17 Delivered Data Analysis Share of broadband access via ADSL 100,0% 90,0% 80,0% 70,0% 60,0% 50,0% 40,0% 30,0% 20,0% 10,0% 12,9% 12,3% 87,1% 87,7% 7% 17,0% 83,0% 0,0% /1 2007/1 Broadband access via ADSL Broadband access via other technologies Source: Questionnaires for Market 12

18 Delivered Data Analysis Total number of unbundled local loops from the beginning of providing the service /3 2006/4 2007/1 1 July 2007* Source: Questionnaire for Market 11; * latest data available

19 Relevant Markets Definition defining markets at two levels o retail level o wholesale level demand for wholesale broadband access services is derived directly from the retail level markets definition at retail level - defining services that are considered to be substitutes and constitute same relevant market markets definition at wholesale level - defining services that are considered to be substitutes and constitute same relevant market

20 Relevant market at retail level broadband access at retail level in Croatia is available by following technologies: ADSL with direct network connection ADSL via unbundled local loop access via mobile networks access via cable networks FWA via WiMAX technology access via fibre-optic cables access via leased lines access via satellite connections demand substitutability analysis - to define services that are substitutes upon what they are part of the same relevant retail market.

21 Relevant market at retail level Technologies had to meet following criteria in order to be included in the retail market definition iti : providing permanent Internet access technologies have to be substitutes in terms of prices; technologies have to be substitutes in terms of download speeds; service is charged on the basis of the quantity of transmitted data, and not on the basis of duration.

22 Relevant market at retail level Following services are considered as parts of the same retail market : ADSL access via copper pair ADSL with direct connection to HT network ADSL with direct connection to other operators network ADSL technology via unbundled local loop cable access

23 Relevant markets at wholesale level According to Commission recommendation and Ordinance on the conditions and manner of determining i relevant markets in telecommunications, ti regarding broadband access, following markets are defined at wholesale level: Unbundled access, which also includes the shared access, to the local loop for provision of voice services and broadband access (Market 11) Broadband access, also including bitstream access, which renders a possible two-way communication (Market 12)

24 Relevant markets at wholesale level LADDER OF INVESTMENT Investment Infrastructure Wholesale services Own access network Complete customer relationship Full unbundling DSLAM, splitter etc. Shared access VoIP, IT Bitstream access Customer service, billing, marketing, itd. Resale Services

25 Wholesale services and own costs analysis Full unbundled access Unbundled access to the local loop Monthly charge access RUO Collocation costs Charges on one-time basis DSLAM of the alternative operator backhaul core netwo rk other costs ve operator Costs of the alternati Backhaul network of the alternative operator Core network of the alternative operator Selling costs Marketing costs Internet costs CPE costs Retail level HT s public voice service + DSL access offer

26 Wholesale services and own costs analysis Shared access Bitstream access DSL access resale Shared access to the local loop Monthly charge access backhaul operator RUO Collocation costs Charges on one-time basis DSLAM of the alternative operator Backhaul network of the alternative operator Bitst tream offer Bitstream access Charge on one-time basis Backhaul fer Resale off DSL access resale Charge on one-time basis core network other cos sts Cos sts of the alternative Core network of the alternative operator Selling costs Marketing costs Internet costs CPE costs Costs of the alternative operator Core network of the alternative operator Selling costs Marketing costs Internet costs CPE costs Costs of th he alternative ope erator Selling costs Marketing costs Internet costs CPE costs Retail level HT s offer for DSL access

27 Market for broadband access, also including bistream access, which renders a possible two-way communication market definition procedure 2 dimensions have to be defined: service dimension geographical dimension to define relevant market in service dimension demand substitutability and offer substitutability analysis should be conducted in order to define services that are substitutes upon what they are part of the same relevant market basic service in relevant market in Croatia: ADSL transport service offered by HT

28 Relevant market definition in service dimension Demand substitutability establishing whether the wholesale cable access should be included in the same wholesale market establishing whether the ADSL access with the direct connection to other ISPs own network should be included in the same wholesale market establishing whether self-supplied ADSL transport service and self-supplied ADSL access service should be included in the same wholesale market establishing whether LLU and ADSL transport service should be included in the same wholesale market Supply substitutability possibility that alternative operators offer substitute service in short period

29 Relevant market definition in service dimension ADSL transport service with access at IP level ADSL transport service self supply ADSL access service self supply

30 Relevant market definition in geographical dimension all areas where certain service providers provide services under the same conditions all areas with competition conditions of the same kind Analysis result: relevant services are offered in the entire territory of Croatia relevant services are offered to service providers under the same conditions relevant market is national in scope - entire territory of Croatia

31 Market for unbundled access, which also includes the shared access, to the local loop for provision of voice services and broadband access market definition procedure 2 dimensions have to be defined: service dimension geographical dimension to define relevant market in service dimension demand substitutability and offer substitutability analysis should be conducted in order to define services that are substitutes upon what they are part of the same relevant market basic service in relevant market in Croatia: LLU offered by HT incumbent HT - owner of the public telephone network with active telephone connections geographical accessibility of telephone connections and local loop is very wide since HT, as a provider of the universal telecommunication service, is obliged to offer the network access to all users

32 Relevant market definition in service dimension Demand substitutability establishing whether the wholesale cable access should be included in the same wholesale market establishing whether LLU and ADSL transport service should be included in the same wholesale market Supply substitutability possibility that alternative operators offer substitute service in short period

33 Relevant market definition in service dimension full unbundled access to the local loop shared access to the local loop collocation

34 Relevant market definition in geographical dimension all areas where certain service providers provide services under the same conditions all areas with competition conditions of the same kind Analysis result: relevant services are offered in the entire territory of Croatia relevant services are offered to service providers under the same conditions relevant market is national in scope - entire territory of Croatia

35 Relevant wholesale markets analysis establish operators market shares designate SMP operators according to market share and other criteria impose remedie(s) on SMP operator(s)

36 Analysis of Market for broadband access, also including bitstream access, which renders a possible two-way communication HT holds market share of 100% HT number of connections via ADSL access 100,0% 4,0% 5,6% 4,1% 3,4% 4,1% 3,7% 90,0% 80,0% 70,0% 60,0% 50,0% 96,0% 94,4% 95,9% 96,6% 95,9% 96,3% 40,0% 30,0% 20,0% 10,0% 0% 0,0% /1 2006/2 2006/3 2006/4 2007/1 ADSL -self supply ADSL transport service for Service Providers Source: Questionnaires for Market 12

37 Analysis of Market for unbundled access, which also includes the shared access, to the local loop for provision of voice services and broadband access HT holds market share of 100% Total number of full unbundled accesses to the local loop and collocations /3 2006/4 2007/1 Broj potpunih pristupa izdvojenoj lokalnoj petlji Broj kolokacija Source: Questionnaire for Market 11

38 Public Consultation from 19 th July 2007 till 24 th August 2007 on CTA s website 3 submissions to the Consultations summarized comments and CTA s position on them were embedded into Analysis

39 25% Broadband penetration rate 16,20% 19,50% 13,40% 17,35% 20% EU average HR 6,10%,67% 8,77% 9,40% 12,80% 15% 10% danas 8,1% 0,08% 0,52% 2,48% 5, 5% 0%