Watchdog warns single 3G licence limiting competition

TIRANA, Dec. 13 – The Competition Authority has warned the granting of a single 3G licence last month has limited competition among mobile operators and asked government to take immediate measures to liberalize the 3G mobile phone market. In some recommendations to the Innovation and ITC Ministry, the Competition Authority describes the granting of a single 3G licence, recently won by Vodafone Albania, as a violation to the competition protection law and abuse of dominant position even though it may be temporary.
“These licences could be granted at the same time so that free and efficient competition on the 3G service enhances. The terms of granting these licences should be the same to those determined in the first awarded licence,” recommended the Competition Commission in its recent decision after examining the information and procedures followed in the 3G tender held on November 8, 2010, when Vodafone Albania was announced the winner of the single licence after offering a record 31.4 million euros, nearly three times more than the initial 12.5 million euros price tag set for the 15-year licence.
Vodafone’s only competitor in the race was Turkish-owned Eagle Mobile which offered 12.6 million euros. First mobile operator AMC and newly launched Plus Communication boycotted the tender in sign of protest against the government decision to grant a sole licence.
The Competition Authority is worried government has not set new deadlines for the granting of the other three possible licences despite the Innovation and ITC Ministry’s promise that the individual authorization initially granted to Vodafone Albania will be a short-term one.
The Electronic and Postal Communications Authority (AKEP), a legally independent body organizing the ITC tenders, has also been recommended to regulate the broadband technology service, based on transparent methodologies and ensure a cost-oriented approach to tariffs.
Reacting to AKEP’s decision last month, AMC expressed its reservations about the fact that a monopoly situation was being created by granting a single 3G lilence. AMC, the first mobile operator in Albania, said it did not take part in the tender process which it described as damaging to the Albanian mobile phone market also because of pressure by regulatory agencies.
All four mobile companies had earlier suggested the granting of four 3G licences to promote competition and increase technology investments, warning that a monopoly would be created.
However, few days before the tender was held, government turned down requests by the country’s four mobile operators to grant four 3G licenses instead of one. “It is very important that government demonstrates its political will to accelerate the widespread of 3G technology and open up the high speed internet market without creating unnecessary barriers,” said the four companies in their joint statement, also expressing their concern over the high 12.5 million euro price tag.
According to the Authority, the launch of 3G, which refers to the third generation of mobile telephony technology, is necessary to further develop information technology and wireless internet in Albania.
Albania became the last country in the Balkans to issue permits for 3G technology, which enables faster internet services, including video calls, on mobile phones.
Meanwhile, Vodafone Albania has announced that the start of 3G services in the capital Tirana is a matter of weeks promising that it will build a totally new 3G network and is planning to invest heavily in order to deploy it throughout Albania in the next 18 months.
According to Vodafone Albania CEO Haris Broumidis, the 3G technology will revolutionize the use of high speed internet and data access to every device that can accommodate a Vodafone Sim card no matter if it is used on a mobile phone, PC, laptop, netbook etc.
A recently released report by the Electronic and Postal Communications Authority (AKEP) showed the number of mobile phone subscribers at the end of July 2010 reached 4.4 million, up 5.5 percent compared to the end of 2009 and 25 percent year-on-year.