TISCALI-ALBACOM/TELECOM ITALIA
PRESS RELEASE
PRESS RELEASE
Investigation of Telecom Italia for alleged abuse of dominant position in the offering of telephone links to its competitors.
The Competition Authority has begun an investigation into Telecom Italia to ascertain whether it has restricted competition on the final telecommunications services markets, particularly in relation to providing local link infrastructure, and in particular with reference to the cost of the inverse connection (termination prices of calls originating from the Telecom network numbers for numbers belonging to the competitors’ networks).
Even following liberalization that began in 1998, Telecom Italia retained its undisputed dominance over all the end user telecommunications services markets and over the availability of local link infrastructure. Furthermore, through its TIN and Interbusiness services, Telecom Italia also appears to hold a particularly high market share of Internet access services.
The investigation began as a result of complaints against Telecom regarding the terms and conditions for inverse connections provided by the contracts concluded with Tiscali and Albacom. Telecom was alleged to have terminated, in advance of the expiry date, its inverse connection contract previously concluded with Tiscali at the end of 1998, and when negotiating with contracts with Tiscali and Albacom in 1999 it imposed technical and financial terms and conditions for the termination of calls using its competitors’ numbers which were more favourable to itself, without any justifiable reason.
The financial conditions imposed by Telecom Italia in the inverse connection contracts with Albacom and Tiscali appear to be such that the operators which link into the public switched network are unable to obtain an adequate return on the terminal service using their own numbers, which limits their capacity to sustain the introduction of new telecommunications services.
Telecom Italia’s competitors have therefore only limited possibilities to offer their customers more favourable terms for telecommunications services using their own numbers, consequently restricting their ability to compete on the final services markets.
The conduct of Telecom Italia is therefore being investigated, to ascertain whether it violates section 3 of the Competition Act (law 287/90), considering the dominant position it holds on all the final telecommunications services markets, including the market for Internet access services.
The investigation is due to be completed by 9 March 2000.
Rome, 17 September 1999.