Chapter 3: The Telecommunications Sector
Competition problems in the telecommunications sector
From an international perspective, the liberalisation of the
Danish telecommunications sector has been successful with many
providers and low prices, especially for mobile telephony. However,
almost all of TDC’s competitors are suffering losses, and even major
providers may therefore leave the market. Moreover, Denmark’s leading
position may be threatened by a lack of technological development. This
chapter therefore depicts several areas that might benefit from
changes.
At the moment, calling from a fixed-line telephone to a mobile
telephone is, for example, expensive. This is related to the fact that
mobile telecommunications companies charge a hefty price for receiving
calls for their customers – consequently, the so-called “termination
price” is high. In other words, fixed-line telephone consumers have,
for years, paid for the falling mobile telephony prices, and this may
create obstructive competition between fixed-line telephony and mobile
telephony. The mobile termination price should therefore be lowered,
but only gradually so that companies can adapt to the new conditions.
Secondly, it is unfair that mobile telecommunications companies
in Denmark are subject to more stringent requirements concerning
commitment periods than companies in most other EU countries. Only
Finland has a stronger regulation of commitment periods. Mobile
telecommunications companies in Denmark have, accordingly, less time to
recover the contribution that they make to their customers’ purchase of
new telephones. This may slow down technological development in Denmark
compared with other countries.
According to the estimates of the Competition Authority,
competition will not be affected significantly if companies are allowed
to offer customers a commitment period of up to 12 months. This will
align the situation in Denmark with that in most other EU countries.
Contacts: Niels Rytter, Head of Division (+45 7226
8097), Marcus Hansen, Administrative Officer (+45 7226 8026) and Lau
Nilausen (+45 7226 8122).
|
|
