ACM sees a potential competition problem in the Netherlands by emerging quad play

Mar

1

2017

The ACM has any negative effects on competition analyzed by the bundling of telecommunications services and content. The ACM said that there is no distortion of competition, but expects that the arrival of quad play will strongly influence the competition.

The regulator says that it can be advantageous if consumers fall several telecom products into one bundle, but argues that this makes it more difficult for users to switch to another provider. Possibly this could weaken the position of smaller suppliers. Also, the offer of free movies and series or sports broadcasts, such as Ziggo Sports, potentially anti-competitive, as they may remain on time less choice and will reduce the financial benefit for the consumer. It appears from a preliminary analysis of the regulator.

ACM identifies three possible market distortions caused by quad play. First, the combination of fixed and mobile would lead to less transparency because the beams with different products is becoming increasingly difficult to compare prices. It would also change are hampered by switchers have to invest more time and effort to find another suitable offer, which would lead to “search costs”. It must also terminate a consumer for a fixed-mobile offering by switching two contracts, which would make the threshold higher to actually make the switch. Finally, there is the risk that will be printed in smaller batches of the market.

The analysis shows that the providers have confirmed to the ACM that the introduction of quad play has reduced the transfer of customers. The fixed-mobile bundling is specifically used to discourage switching behavior. Allows powerful providers like VodafoneZiggo and KPN, in fact restrict new entrants to the market and thus exclude competitors. ACM maintains that at present there by access regulation is not a party in a dominant position which may act independently of competitors and customers. However, the regulator sees a risk for parties who depend wholesale access, such as Tele2 and T-Mobile, because they do not have their own network and generally have lower margins than KPN and Ziggo.

An official investigation into the anti-competitive effects and a specific focus on one or more providers is not yet on the agenda. The ACM has made a preliminary analysis and asks stakeholders to provide input about the opportunities and risks they see. Until April 11 to respond to stakeholders consultation questions from the analysis. What happens next is still unclear. It could be launched from an investigation of whether the current practice of quad play, for example Ziggo and KPN is the legal definition of abuse of a dominant position, in which the Dutch Competition Act is prohibited and EU-Operation Treaty.

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