Market developments

Since mid-2005, when the analysis referred to above was published, the main developments seen impacting the offer on the market relate to the significant development of leased lines offers based on Ethernet solutions and the expansion by the main alternative operators of their own transport networks.

Among other changes in the domestic market which have affected the structure of the electronic communications market, the following are of note:

• The separation ("spin off") of PT Multimédia - Serviços de Telecomunicações e Multimédia, SGPS, S.A. (now ZON Multimédia - Serviços de Telecomunicações e Multimédia, SGPS, S.A. - hereinafter ZON) from Portugal Telecom, SGPS, S.A., occurring on 7 November 2007 was a driver of greater competition in markets where these companies operate ¹. In this context, the analysis of the "markets for wholesale (physical) network infrastructure access at a fixed location and wholesale broadband access" clarified the regulatory situation following the "spin off" ².
  
  
• Concentration operations, including:
  
  
  • the acquisition, in 2007 by Sonaecom, S.G.P.S., S.A. (Sonaecom) of sole control of the entire share capital of Telemilénio - Telecomunicações, Sociedade Unipessoal, Lda. (Tele2);
    
    
  • the acquisition in 2007 by Sonaecom ³ of sole control of a set of assets corresponding to the residential segment and SoHo (Small Office/Home Office) segment of the fixed network retail communications business of Onitelecom - Infocomunicações, S.A. (OniTelecom).
    
    
  • the acquisition by CATVP (now ZON) ⁴ of sole control of Bragatel ⁵, Pluricanal Leiria ⁶ and Pluricanal Santarém ⁷, through the acquisition of shares currently held in these companies, by Parfitel - SGPS, S.A.;
    
    
  • the acquisition, by ZON, of sole control of TVTEL ⁸.
    
    
• The expansion of the local loop unbundling offer (LLU), in terms of local exchanges with co located operators using mainly their own transport infrastructure (supported over optical fibre) - e.g., Sonaecom and OniTelecom -, and the entry of new operators, as in the case of COLT TELECOM - Serviços de Telecomunicações, Unipessoal, Lda. (COLT), and VODAFONE PORTUGAL - Comunicações Pessoais, S.A. (Vodafone).
  
  
• The expansion of mobile broadband, in particular and for the purposes of the present analysis, supported over enhanced base station capacity, in many cases using leased lines and/or own infrastructure ⁹.
  
  
• The launch by alternative operators of new products (e.g. "triple-play") supported over optical fibre, enabled by recent developments related to the expansion of own or leased optical fibre networks (for example, utilities).
  
  
• Rising speeds of broadband offers, with a requirement for enhanced capacity in terms of the transport and interconnection/peering network, including the use of leased lines.

Looking to the future, the evolution to next generation networks (NGN - Next Generation Networks), should be monitored, both in terms of the transport and interconnection networks, as well as in terms of the access networks ¹⁰.

Moreover, the European Commission (EC) has since revised the Recommendation on relevant markets, whose final version was published at the end of 2007, as described in detail in section 1.4 of this document.