MCA's actions on national broadband market

The Malta Communications Authority (MCA) is taking action in a bid to convince the European Commission that it should be able to mandate access to broadband networks by Internet Service Providers (ISPs).

The basis of telecommunications regulation in Europe is the regular review of telecommunications markets to measure the extent of competition or otherwise and regulate accordingly. There are 18 such markets, one of these being the broadband access market.

The MCA last week said in a statement it has completed the review of this market, concluding that:

• there are at present two operators of broadband networks in Malta, these being Maltacom and Melita Cable;

• the two operators have approximately an equal share of the market with similar offerings and prices;

• the two operators enjoy a situation of joint dominance - that is, they are able to act, to a significant extent, independently of other players in the market and of consumers;

• given the above, the two operators should be required to provide access to third party ISPs, without discriminating in favour of their own ISPs.

The current situation is that Maltacom and Melita Cable are required to provide cost-oriented, non-discriminatory access to their broadband infrastructures to ISPs.

"Maltacom is abiding by this obligation, while Melita has appealed from this obligation and its cable network is currently exclusively accessible to its subsidiary, Onvol," the MCA said. "This means that ISPs are only able to provide their customers with broadband access from Maltacom."

Following notification of its findings to the EU Commission, the Commission agreed that Melita Cable's infrastructure should be considered as part of this market, but it expressed serious doubts on the MCa's finding of joint dominance.

The Commission's view is that our broadband market enjoys healthy competition with broadband take-up with the variety of offers and prices comparable to those in other member states.

The Commission's conclusions prohibit the imposition of access obligations on the two operators. In the circumstances, the MCA has temporarily withdrawn its notification of this market in order to once again review its findings and conclusions.

"The MCA feels strongly about the absence of fair competition in this market and the need to ensure cost oriented and non-discriminatory access to broadband infrastructures by ISPs," it said in the statement.

"The imposition of access obligations on cable infrastructure operators has long been a matter for debate between the European Commission and national regulators in many member states. Malta's case is particularly interesting in this regard since both Maltacom and Melita Cable operate "national" infrastructures. Cable operations in other countries are typically local or regional in nature."

The MCA's counterparts in other member states are waiting with keen interest to see how this impasse between the MCA and the Commission is played out. Its outcome may have reverberations on the broader EU broadband market.