The Competition Authority has published the fifth Monitoring Report on the Electronic Communications Markets, relating to the year 2010. The document analyses the development of competition in the electronic communications markets in Portugal, in particular with regard to the landline telephone service, the mobile telephone service and the broadband internet service. The report gauges the relative position of our country in relation to the various member states of the former fifteen-member European Union (EU15).
Fixed voice communications
In 2010, for the fixed telephone service, Portugal registered a lower penetration rate (42%) than the EU15 average, though this rate recorded an increase. This may be due to the launch of new fixed telephone service offers, generally as part of a service package.
Though lower than the EU15 average, the level of concentration in this market in Portugal presented a significant increase. This may indicate stagnation in the expansion of the alternative operators that was registered following the spin-off of ZON from the PT Group. To a large extent, the high level of concentration in this market stems from entry restrictions and the limited mobility of consumers. These factors explain the fact that, in the context of the Memorandum of Understanding (ME), the development of measures to promote competition was proposed, in particular in terms of the promotion of consumer mobility and the easing of entry barriers.
With regard to the pricing of landline communications, it should be noted that the costs of local and national calls in Portugal in 2010 were lower than the EU15 average. With regard to the baskets of landline communications for residential customers (large, medium and small users), the price in Portugal in 2010 was lower than the EU15 average, whereas the price of the baskets for SMEs was higher. In 2010, large and medium users saw price reductions and SOHO and SME customers price increases.
Mobile voice communications
With respect to mobile voice communications, the penetration of this service in Portugal was one of the highest (152% in 2010), very close to the highest EU15 levels. As regards the level of market concentration, the two main mobile communications operators in Portugal registered a high joint share - one that is expanding in relation to earlier years. This concentrated structure may be explained by the limited level of consumer mobility, the network effects that characterise this service, and the entry restrictions. In an attempt to mitigate the impact of the network effects, the sector regulator has been setting mobile call termination rates at a progressively lower rate. Regarding entry restrictions, the ME states that the entry of new operators into the market should be promoted by means of spectrum auctions.
The average price for mobile calls in Portugal in 2009 was lower than the EU15 average. With respect to the baskets for mobile communications, the prices for the baskets covering post-paid plans in Portugal in 2010 were higher than the EU15 average, having risen between 1% and 2%. On the other hand, the price of the basket for small consumers with pre-paid plans was lower than the EU15 average, in spite of an increase of 2% in 2010.
Broadband internet access
For the broadband internet service, it may be seen that, in January 2011, the penetration rate for landline access (21%) was one of the lowest among the EU15. This figure was partly offset by the penetration rate, relatively higher, for mobile access (12%).
At the beginning of 2011, the joint market share of the alternative operators to the incumbent was slightly higher for landline access than the EU15 average, though it has been falling in the last two years. This followed the initial impact of the spin-off of ZON from the PT Group, which was reflected in an expansion in the position of the alternative operators.
In 2010, the price of fixed broadband internet access in Portugal for speeds between 2.5 and 15 Mpbs was in line with the average for the EU15. For speeds between 15 and 30 Mbps, the subscription price in Portugal was 3% below the EU15 average. For higher speeds (above 45 Mbps), the price in Portugal was substantially higher.
Lisbon, 23 September 2011