EU Ends Antitrust Probe Into Deutsche Telekom

by Ulrika Lomas, for LawAndTax-News.com, Brussels

04 March 2004

German telecommunications firm, Deutsche Telekom has pledged to reduce the line sharing fee that it charges competitors for access to its local loop, thus bringing to an end an EU antitrust investigation.

Speaking earlier this week, EU Competition Commissioner, Mario Monti explained that:

"In spite of a 2001 EU obligation to provide competitors shared access to its local loops, only a few competitors found it profitable to make use of shared access. Deutsche Telekom meanwhile has become a quasi-monopolist for broadband access at retail level. None of the new entrants has been able to reach any significant market position. This is due to DT's anti-competitive tariff structure."

He continued:

"We believe that competition between operators is the best means for bringing the overall prices down. That is why we have ensured that the margin squeeze shall be remedied to a large extent by lower wholesale tariffs that competitors have to pay for shared access. We trust that the German regulator accepts this consumer-friendly solution."

Deutsche Telekom is the dominant supplier of broadband access in Germany, both at wholesale and at retail level. At wholesale level, Deutsche Telekom is the only German network operator having a network with nation-wide coverage. In order to provide a variety of services to end users, new entrants need access to this infrastructure on a wholesale basis. Regarding retail access, even after more than three years of competition, Deutsche Telekom still has around 90% market share.

The European Commission investigation into Deutsche Telekom was triggered by a 2002 complaint from new market entrant QSC.

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