AGCM

PRESS RELEASE

TELEPHONY SECTOR: ANTITRUST AUTHORITY LAUNCHES INVESTIGATION INTO TWO POSSIBLE CASES OF ABUSE OF DOMINANT POSITION BY TELECOM

Proceedings undertaken following reports by Fastweb and Wind.


A decision was taken by the Autorità Garante della Concorrenza e del Mercato in a meeting held on 23 June 2010 to launch an investigation into Telecom to ascertain whether the company has committed two separate abuses of dominant position aimed at  hindering competition from Other Licensed Operators (OLOs) concerning the provision of end-customer services.
The proceedings, notice of which was served today during inspections carried out in conjunction with Special Units from the Guardia di Finanza (Italian Tax Police), have been initiated following a series of reports presented by telephony operators Fastweb and Wind.
The reports claim that Telecom has attempted to exclude competitors through two abusive methods:
deliberately hindering or delaying the activation of wholesale services requested by competitor operators. In particular, Telecom is accused of providing unjustified or specious technical reasons or having acted with insufficient diligence in providing services that are fundamental in enabling competitor companies physical access to the telephone and broadband network. If confirmed, this technical boycott implemented through the denial of a large number of activation requests, would have adversely affected the conventional voice telephony as well as VOIP and Internet access retail services market, considerably hindering the provision of services to end-users by alternative operators with obvious negative repercussions for the latter. Wide-scale non-activation slows down and impedes the provision of services and development of OLOs and is detrimental to end-users.
introducing highly aggressive pricing policies in areas where competitors are able to offer unbundled network access (last-mile cable leasing) involving large discounts compared to the prices Telecom itself applies in areas less exposed to competition, and in any case at prices lower than the wholesale costs sustained by competitors for unbundling. Wind and Fastweb claim that in this way Telecom can appropriate profits in areas where competition is restricted to other access services alone in order to fund discounts to business end-customers that are not replicable in areas where competitors can operate through unbundling.


Rome, 24 June 2010