The operational capacity of the merged MásMóvil has forced the National Markets and Competition Commission to review the existing regulations. Telefónica will be the main beneficiary, with greater flexibility and agility to continue competing with its rivals without the current CNMC regulations.
The latest changes that have shaken the Spanish telecom sector have forced the National Markets and Competition Commission (CNMC hereinafter) to review the current market situation. Recently, the regulator telecommunications sector has decided to address the liberalization of the residential fiber broadband market once the summer months are over, as reported by the newspaper Expansión.
The movement arises as a consequence of the current panorama in which all the agents that belong to this sector find themselves. Although during the years 2016 and 2021 different movements focused on a progressive deregulation, It was not until the impact of the latest operations was studied that it was decided to address the pertinent changes to continue maintaining the competitiveness of the sector.
A new proposal
The CNMC will have to carry out, first of all, a public consultation with all the agents that are part of this sector. And, once completed, a new proposal will be sent to Brussels that will address all the bases on which the new market regulation that will have to be approved by the European body. It is expected that this new document can be approved at the end of 2024 or, ultimately, during the first months of 2025.
There have been two main ingredients that have motivated this change. On the one hand, the merger of MoreOrange and Orange, which has given rise to a new leader in the Spanish telecommunications market. A position that until then was occupied by Telefónica. On the other hand, the growing deployment of fiber networks that has occurred in recent years has also been taken into account and which, since its last review in 2021, has allowed the creation of up to dozen independent wholesalers.
Greater commercial muscle for Telefónica
The deregulation of the market will have Telefónica as the most benefited telecom company, which will be able to have greater agility to be able to compete with the rest of the rivals with which it shares the sector.
At the time MásOrange was born in our country, the merged company had more than 30 million customers with mobile services and 7.3 million customers with broadband. Its market share exceeded 40%. At that same time, Telefónica did not reach 6 million fixed broadband customers and had 20.15 million mobile lines, 10 million less than its rival. So there was no reason to think thatand the regulation to which Telefónica was subject made any sense, given the new reality he had to face.
According to the same media previously mentioned, the current regulation represents a delay of 30 days every time you want to add a new rate to your catalog. While to activate any promotion on a temporary basis, the approval period is 15 days, since everything has to go through the approval of the CNMC itself.
With the current regulation, Telefónica does not have total freedom when it comes to define the conditions with which it offers its services. Its offers are previously studied by the CNMC to guarantee that the prices it wants to present in the market can be replicated by its rivals. A scenario that remains answer’s capacity compared to the rest of its main competitors.
As the CNMC advances in its deregulation policy, Telefónica will increase its commercial muscle to be more agile and capable of responding to any movement carried out by its competitors with the aim of improving its situation in the market.
