Determination
The facts
1. On 17 September, PT Comunicações, S.A. (PTC) informed ANACOM and the interested parties that they had included in the “PT ADSL Network” (Rede ADSL PT) wholesale offer a new class of service with a speed of 1024/256 kbps and a maximum contention of 1:50. Since PTC must comply with the 30-day notice deadline to be given to their wholesale offer customers whenever there are changes to their offer conditions, the latter will only come into force on 18 October.
ANACOM requested PTC, on 30 September, to send the retail offer terms and conditions that the companies of the Group would like to launch based on the new class of service pertaining to the “PT ADSL Network” offer.
Simultaneously, ANACOM informed that PT Group companies could not provide for any type of offer, sell or disclose by any means retail services based on the new class of service, until 10 working days have elapsed from the date on which ANACOM received the respective offer conditions.
2. By determination of 26 August, submitted to prior hearing of the interested parties, ANACOM instructed PTC to offer, at (“PT ADSL Network”) wholesale level, a class with 2 Mbps downstream and 512 Kbps upstream.
This measure became necessary since PTC, following ANACOM determination of 6 April on the “Evolution of the PT ADSL Network wholesale offer”, did not include, as expected, a class of service with a speed equal or higher than 1 Mbps, in accordance with the clear minimum principles contained in the prior hearing report (3.3. ATM network characteristics).
Taking into account that ANACOM determination of 26 August is a draft decision, under evaluation following the replies of the interested parties, followed by a final determination after which a 10-day deadline may be decided to change the offer, it is not feasible that the 2 Mbps class of service, by final determination of ANACOM, will come into force in October. However, PTC, by its own initiative, may include it before – in which case it will always be forced to comply with the 30-day notice.
3. On 12 October, the media disclosed the launch by PT Group, foreseen for 15 October, retail broadband offers at 1 and 2 Mbps on the respective cable distribution network.
In addition, Onitelecom had requested ANACOM’s intervention, so as to suspend an announced sale of said retail offer in cable network, namely the one at 2 Mbps.
Analysis
4. Out of the described facts, PT Group companies, following a group strategy, are able to launch retail offers before their competitors based on the “PT ADSL Network” – wholesale offer controlled by PTC which has required successive interventions of this Authority in order to adapt it to the needs of operators and consumers.
5. Although there are in the market ADSL retail offers with a speed higher than 1 Mbps sold by the competitors of PT Group companies, those offers are based on the disaggregated access of local loop which has at present a reduced coverage, since the number of stations where the operators are installed is low.
6. ANACOM must, upon request of any of the parties, and may, by own initiative, intervene in the execution of agreements for special access to networks (such as the agreements based on “PT ADSL Network), to ensure an effective competition, namely determining non-discriminatory conditions (article 33 of the Regulation for the Operation of the Fixed Telephone Service, approved by Decree-Law no. 474/99, of 8 November, applicable under the terms of subsection e) of paragraph no. 2 of article 122 of Law no. 5/2004, of 10 February).
7. It is ANACOM’s understanding that, at present, the only way to ensure non-discrimination conditions between retail equivalent offers is to ensure that PT Group companies will only launch cable offers once the equivalent wholesale offers in “PT ADSL Network” will come into force, that is:
(a) for the class of service with a speed of 1024/256 kbps and maximum contention of 1:50, from 18 October onwards;
(b) for the offer of 2 Mbps, 30 days after communication to the operators of the change to the wholesale offer by initiative of PTC or 10 days after ANACOM decision if the latter corroborates the draft decision of 26 August.
8. Notwithstanding, within the scope of the broadband market analysis, other ways of ensuring non-discrimination and conditions for a real competing market may be considered.
9. Since this determination is urgent, taking into account that the launch of offers is foreseen to 15 October, there is no prior hearing of the interested parties pursuant to article 103, paragraph 1, subsection a) of the Rules of Administrative Procedure.
Thus, the Board of Directors of ANACOM, taking into account the legal rules referred to above and the provisions contained in article 6, paragraph 1, subsections b) and e) of its Statutes, approved by Decree-Law no. 309/2001, of 7 December, within the regulation objectives foreseen in article 5 of Law no. 5/2004, of 10 February, namely in its paragraph no. 1, subsection a), and pursuant to subsection g) of article 9 of those Statutes, decides as follows:
1. PT Group companies can only sell the announced broadband retail offers of 1 Mbps and 2 Mbps in the cable distribution network once the corresponding wholesale conditions in the “PT ADSL Network” come into force.
2. Should PTC, by own initiative, include the class of service of 2 Mbps in “PT ADSL Network” offer before ANACOM’s final determination, to be adopted following its draft decision of 26 August, the equivalent retail offer in the cable distribution network can only be sold once a 30-day notice deadline has elapsed, applicable whenever there are changes to the “PT ADSL Network” offer.
Lisbon, 14 October 2004
The Board of Directors
