Dutch regulator proposes wholesale cable access on VodafoneZiggo network

Tuesday 27 February 2018 | 08:44 CET | News

The Dutch Authority for Consumers and Markets (ACM) wants to regulate the cable network of VodafoneZiggo for the first time. In a new analysis of the fixed market, the regulator said it wants to assure providers of TV, internet and telephony services that do not have their own network that they will have sufficient access to the consumer market at reasonable rates. At the moment, only KPN’s copper network is open to wholesale access.

In its draft decision on the market for wholesale fixed access, the ACM has proposed that alternative providers also get access to VodafoneZiggo’s cable network. More providers would then be able to provide internet, television and fixed phone services via cable. This would ensure sufficient competition on the retail markets, with more choice and good rates for consumers and businesses. Pending a public consultation, the ACM wants the market decision to take effect later this summer.

KPN and VodafoneZiggo in equal position

Alternative providers currently only have access to KPN's regulated copper and fibre networks; this remains in the draft decision. Until now, only KPN has been designated as a significant market power, and cable networks were not regulated. However, a nationwide cable network emerged through the merger of Ziggo and UPC in 2015. The merger between Vodafone and Ziggo followed shortly after the last market analysis of January 2016. KPN and VodafoneZiggo now have equal positions on the telecom market, each with its own fixed and mobile network.

The latest merger prompted the ACM to accelerate its next market analysis, starting earlier than originally planned. In this analysis, the regulator notes that KPN and VodafoneZiggo both have significant market power (SMP), without regulation, on the market for fixed networks. This status could enable them to both exclude alternative suppliers from the market and possibly charge excessive retail prices for end-users.

Insufficient competition without regulation

According to ACM board member Henk Don, there will not be enough competition on the market for fixed telecom networks if there is no regulation, due to the dominant position of KPN and VodafoneZiggo. The ACM has therefore proposed to regulate both parties. "In this way, the ACM will ensure that market parties can use KPN and VodafoneZiggo networks over the coming years, without the need to set up their own fixed network," Don said.

According to the ACM, access to copper, fibre and cable networks now falls within one and the same wholesale market, in contrast to two years ago. The change comes on the back of technological developments. As KPN improved its network, physical unbundled access became less attractive and alternative providers opted for access at a higher level in the network (virtual unbundling). For comparable access forms, the cable network of VodafoneZiggo will increasingly become a good alternative for offering services to end users.

Entry into force this summer

The public will have six weeks to present their views on the market analysis. The ACM will then submit an amended draft decision to the European Commission. The ACM wants the decision to go into effect this summer.

The ACM spent a large part of 2017 working on the new draft decision on wholesale access. It originally wanted to come up with a draft decision in December, but failed to meet this deadline. In recent years, there has been more support from political spheres for the regulation of cable in order to boost competition.

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