FICORA to issue new proposal on broadband regulation in Finland

JANUARY 28, 2009 -- Finnish Communications Regulatory Authority FICORA has announced that it will abandon its effort to ease wholesale broadband access regulation due to opposition from the European Commission.

FICORA proposed de-regulation because the retail and wholesale charges for broadband services in several speed categories in major Finnish cities are lower than the Finnish average. In addition to the local telecom operators, at least two competing telecom operators with their own equipment for providing broadband access have activities in the area.

In the European Commission's view, the traditional operators' market share was too high for regulation to be removed. According to the Commission, a wholesale market share of more than 50% is in itself a clear proof of inefficient competition. The Commission maintains that broadband connections provided via cable television network do not create enough competition for broadband connections provided in the traditional telephone network.

In the weeks to come, FICORA says it will prepare a new proposal for the Commission on the regulation of broadband markets in the largest cities. The proposal will be sent for comments to telecom operators before submitting it to the Commission.

FICORA must analyze the markets in order to establish the competitive situation; according to the Communications Market Act, at regular intervals, the Finnish Communications Regulatory Authority shall perform a market analysis of relevant wholesale and retail markets determined by the European Commission in order to establish the competitive situation. On the basis of the market analysis, FICORA will present its view on the necessity of ex-ante regulation.

The Commission's opinion and FICORA's draft decision on the
wholesale broadband service market are available on the European
Commission's website, which can be accessed here.

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