The fiber optic network is, along with the 5G, the key of the supply of a telecommunications company. Without fiber, there is no high speed Internet nor can you watch Netflix in HD, for example. Therefore, competition between companies is brutal in this segment, and the regulation raises concern.

broadband Coverage

market Share of broadband in %

Sep. 2019

Jun. 2015

39,6

Movistar

44,5

Movistar

26,1

Orange

28,3

Orange

20,9

Vodafone

22,1

Vodafone

8,9

More Mobile

2,1

Euskatel

4,1

Euskatel

2,9

Other

0,4

Other

Source:CNMC and companies.

THE COUNTRY

broadband Coverage

market Share of broadband in %

Sep. 2019

Jun. 2015

39,6

Movistar

44,5

Movistar

26,1

Orange

28,3

Orange

20,9

Vodafone

22,1

Vodafone

8,9

More Mobile

2,1

Euskatel

4,1

Euskatel

2,9

Other

0,4

Other

Source:CNMC and companies.

THE COUNTRY

broadband Coverage

market Share of broadband in %

Movistar

44,5

Orange

28,3

Vodafone

22,1

Euskatel

2,1

Other

2,9

Jun. 2015

Sep. 2019

39,6

Movistar

26,1

Orange

20,9

Vodafone

8,9

More

Mobile

4,1

Euskatel

0,4

Other

Source:CNMC and companies.

THE COUNTRY

After a long period of uncertainty, the National Commission of Markets and Competition (CNMC) has decided to review finally in 2020 the map of the fiber, that is to say, the communities where Telefónica must give on rent its network at a regulated price, reported to THE COUNTRY-sector sources. This is the first review that Competition does of this regulation, after which it had approved in February of 2016 in the forcing Telefónica to share its network with its competitors in throughout the Spanish geography, except in 66 large cities.

Phone is the most affected by this standard because it is the only operator that should give your network. The company has been demanding that we expand significantly the number of municipalities where you do not have the obligation to lease their network, that is to say, where there is a competition, pure and simple, and who benefit the most invest in. Their main argument is that in the nearly four years that have passed since the first regulation of the market has been a shift full and there is a level of competition very strong that did not occur then.

At the beginning of 2016, there was hardly 28 million lines of fiber and cable (known as next generation networks) deployed, of which 80% were of Telefónica; in 2020, it will surpass the 70 million. In terms of customers, currently there are 10 million homes which have contracted a line of fiber-of which 43% are from Movistar and the rest is split between Orange, Vodafone, MásMóvil and Adamo (to which must be added the three million customers of cable Euskaltel).

broadband Lines, fiber

and cable

millions of lines

Jun. 2015

Sep. 2019

Telephone

Vodafone

Orange

Euskatel

MásMóvil

Adamo

12,5

22,7

8,2

10,4

4,9

14,6

2,1

2,4

0,72

13

0,9

Source: CNMC and companies.

THE COUNTRY

Lines broadband fiber and cable

millions of lines

Jun. 2015

Sep. 2019

Telephone

Vodafone

Orange

Euskatel

MásMóvil

Adamo

12,5

22,7

8,2

10,4

4,9

14,6

2,1

2,4

0,72

13

0,9

Source: CNMC and companies.

THE COUNTRY

Lines broadband fiber and cable

millions of lines

Jun. 2015

Sep. 2019

Telephone

Vodafone

Orange

Euskatel

MásMóvil

Adamo

12,5

22,7

8,2

10,4

4,9

14,6

2,1

2,4

0,72

13

0,9

Source: CNMC and companies.

THE COUNTRY

The approach followed by the CNMC to not demand that they share the network in a population is that in the same there are at least three infrastructures of optical fiber or cable, with a minimum coverage of 20%, to ensure a sufficient competition. According to the estimates of the market, currently, and following this criterion, the municipalities with effective competition would be from 66 to 250. But if, as is the case in many areas, are also the territories where the two companies share investment on the same network (in the case of Vodafone, Orange or MásMóvil) will reach the figure of more than 370 municipalities released.

Municipalities in competition

Phone goes beyond that. And asks you to consider areas competitive the municipalities in which there is another operator besides herself with deployments of fiber or cable, in which case it would reach almost the figure of 540 municipalities in competition, and, therefore, exempt from regulation.

The CNMC will review the market in this year and going to take advantage of this examination, to substantially change the criteria and to better adjust to the reality of the market. The change most relevant is that it will divide the market of fiber in two: the residential market (households) and companies. The primary reason is that while in the first Phone just over the 40% quota, in the second still maintains the 70%. In this way, would be regulated differently in both cases, as shown in sources of the sector.

The regulator has already prepared the public consultation of the review and send it in the next few weeks to the companies to make their claims and, subsequently, send it to Brussels, according to industry sources. Not stocks would become depleted and the five years available to the CNMC in order to comply with the regulatory review that is required.

however, on this end there are also discrepancies. The initial term given to the CNMC for review when it approved the regulation was three years, but the new European Code of Electronic Communications approved recently extended that period to five.

however, this same code states that, in the case of “dynamic markets” (as would be the case of the fiber) may be necessary to perform an analysis of the market with a higher frequency, for example, at least every three years as was the case up to the date of application of this directive. In case outside little, the code is not yet transposed in the Telecommunications General Law (LGT) and therefore, in puridad, is not in force in Spain, as shown in the sources of an operator.

in Addition, a judgment of the Supreme Court of march 12, 2019, requires the CNMC to review new markets of networks and services of electronic communication in which the analysis of the market, precedent has become obsolete as well as when the operator with significant weight in the market or the other involved operators to demonstrate that there has been a substantial alteration of the conditions of competitiveness in the market. With this case law, the review should already have taken place.

Precisely, from Telefónica remember that “the review of markets should be dealt with already last year and that it is necessary to adapt the regulation to the competitive reality Spanish”. For its part, from the CNMC indicated that, “the review of the market of the fiber is underway with the development of the consultation”.

Date Of Update: 09 January 2020, 08:00