As announced in a press release, the CNMC has made the final decision to deregulate the wholesale fixed-line telephone access market. This is excellent news for Telefónica, since within six months it will not be subject to the obligations it has had to comply with until now.
The telecommunications market is changing significantly in Spain and the CNMC is taking steps to ensure that everything flows in the right way. Until now, there were a number of access conditions that applied to the fixed telephone network in the case of all alternative companies other than Telefónica. Now deregulation changes the situation to adjust to market conditions, which will undoubtedly be very positive for the operator.
A progressive change
Years ago, the CNMC already made changes to several of the regulations that were in force. Now the National Commission of Markets and Competition has wanted to take the decision further due to the operations that have been carried out in recent months in the telecommunications sector, such as the creation of MasOrange.
Given that the merger between MásMóvil and Orange has brought about a radical change for the market, the CNMC has seen that it was the ideal time to deregulate it. After all, Telefónica’s market share has been declining and, as stated by the CNMC, retail services currently have “relatively competitive conditions”.
This is what the situation will be like now
With the regulation that will end in six months, Telefónica will no longer be obliged to give access to companies that fall into the category of alternative operators through the AMLT service for the wholesale rental of their telephone lines. In addition to the changes in market share, there are other reasons that have led the CNMC to take this decision, such as the fact that the number of homes in Spain that depend solely on fixed telephony has been considerably reduced.
Instead, lines that combine fixed telephony with Internet have grown and are commonly found bundled with broadband connections, which are considered 1P lines. The data that the CNMC itself revealed in 2023 indicated that the fixed telephony market without Internet was below 10%, so it is not really significant at the moment.
In the case of these increasingly widespread fixed lines with Internet, the option that operators resort to is the use of their fiber networks or NEBA type accesses. On the other hand, those who offer the aforementioned 1P lines do so through the use of their own mobile networks, something that has been increasing in recent years. This means that the barriers and difficulties that operators encountered in the past to be able to offer their services have been drastically eliminated. For this reason, the CNMC no longer sees it necessary to subject Telefónica to the regulation that was imposed in the past.
Among the data provided by the CNMC, it is discovered that Telefónica has seen its market share in lines decrease significantly. Between 2017 and 2023, it fell from 47.08% to 41.79% and it is possibly data that has been decreasing further over time. This is something that the CNMC adds value to, also mentioning that the market is increasingly pointing towards “effective competition” as the aforementioned AMLT-type wholesale lines are reduced. This is a direct consequence of the abandonment of copper, which is already a reality in Spain, as we have mentioned previously.
