The proposal is to confirm the SMP status of Telia in Market 3a, and to keep Market 3b unregulated.
Background: The Swedish regulatory authority, the PTS, last reviewed the markets for wholesale broadband access in 2015. Back then, it found TeliaSonera to have SMP in the wholesale local access market (Market 3a) and imposed access obligations on Telia’s copper and fibre infrastructure, at regulated prices. With regard to wholesale central access (Market 3b), the PTS found the market no longer warranted ex-ante regulation and lifted the obligations previously in place on Telia.
SMP decisions to be extended: The PTS has now published the drafts for the next reviews of the two markets. It proposes to confirm the SMP status of Telia in Market 3a, and to keep Market 3b unregulated as per the previous review, since continued regulation of local access is sufficient to ensure effective competition in bitstream access. In Market 3a, the PTS drafted two separate decisions for copper and fibre, respectively. In fibre, Telia has to provide both physical and virtual access; it must also provide backhaul between an operator's co-located equipment and a point not more than 50 km away, primarily through fibre. Pricing is subject to economic replicability tests, so that competitors can replicate the most relevant products in the retail market. This confirms the move away from the use of a LRIC cost model, which was used until December 2016.
Prices remain cost-oriented for copper networks: The PTS confirms the obligation for Telia to provide access to full and shared unbundled local loops, and retains cost orientation with regard to the price control. A BU–LRIC model is used to determine the prices, which replaced the previous ‘hybrid’ model in use until September 2018.
Next steps: The draft has now been submitted to the European Commission, which will respond by 9 December 2019. If the EC has no major comments, it is likely that the PTS will adopt the decision soon after.