EU: EC updates SMP guidelines for OTT services

The European Commission has approved new guidelines for national telecom regulators to identify significant market powers (SMP) when assessing the need for regulation of markets in order to improve competition.

The updated guidelines take into account the latest EU case law as well as new market factors, such as competition from over-the-top (OTT) service providers, the increased bundling of telecom services, growing competition from cable broadband and the transition of some markets from monopolistic to oligopolistic characteristics. OTT is the audio, video, and other media content delivered over the Internet without the involvement of a multiple-system operator in the control or distribution of the content.

The new guidelines follow a market consultation, external research and an opinion from the regulators themselves, through their EU body. The guidelines come in addition to the ongoing work on a new Electronic Communications Code to update the full EU telecom regulatory framework.

The SMP concept has traditionally applied to the former monopoly operators of copper networks. By designating them SMPs, regulators can impose ex ante regulation at the wholesale level, giving alternative operators network access under controlled prices and conditions in order to boost retail competition. The new guidelines extend the SMP concept beyond a single operator to also cover joint dominance.

The joint dominance concept is based closely on decisions by the EU Court of Justice, and the guidelines aim to help regulators decide whether two or more operators may be exerting a dominant influence on the market.

The updated guidelines also address the emerging OTT communications market, where services similar to traditional telephony and messaging are offered over the internet, rather than physical networks. The guidelines will help the regulators assess whether OTT services should be included in the definition of retail markets, as partial or full substitutes for telecom services.

Full Content: Europa

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