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Spanish operators hit by EUR120M SMS fine


Spain’s antitrust regulator, CNC, has fined the country’s three largest operators – Telefonica, Vodafone and Orange – a total of nearly EUR120 million for overcharging for text messages.

The watchdog said the three operators had abused their dominant position in the wholesale markets for access and origination as well as termination of SMS over their respective networks.

CNC said that the country’s largest operator, Telefonica must pay EUR46.5 million,  Vodafone must pay EUR43.5 million, and Orange EUR30 million. The scale of the penalties reflect the operators’ respective market shares at the time of the offence.

The three operators exploited their wholesale domination to charge excessive SMS prices to consumers, the body said.

According to CNC’s investigations division, the three operators benefited from a lack of regulation of SMS wholesale termination in the period under scrutiny (2000-2009), unlike the country’s voice termination market which was regulated.

Simultaneously, the three applied a similar pricing strategy in SMS access and origination. The net effect was not just to keep retail prices high but also to generate significant entry barriers for MVNO competitors.

However the CNC did not impose any regulatory measures on the three operators to stop a recurrence, although such a move was recommended by its investigations division.

The antitrust body said there were two reasons for not imposing regulatory measures. Firstly, there was only evidence of misconduct by the operators up to 2009. The second reason is that the antitrust body thinks the country’s telecoms regulator, CMT, is in a better position to scrutinise the SMS market.

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