Telefonica Deutschland set to lose MVNO pricing case - Mobile World Live

Telefonica Deutschland set to lose MVNO pricing case

28 MAY 2020

An independent expert conducting arbitration between 1&1 Drillisch and Telefonica Deutschland informed the two operators a forthcoming decision would reject the case for wholesale price rises by the latter.

The two operators confirmed they had been told about the draft decision, which sided with 1&1 Drillisch’s argument against increased fees from its MBA MVNO host network. A loss would have cost the company €64 million.

Telefonica Deutschland argued the sum was justified as a contribution to the cost of acquiring licences at a German spectrum auction in 2015.

The final decision on the case is expected in the coming months and is one of a number of quarrels outstanding between the two companies related to wholesale pricing.

In its statement, Telefonica Deutschland said the draft decision did not follow its rational and added it would analyse the final version in detail before commenting fully.

The operator is also perusing claims against other wholesale partners it values in the “mid double-digit million euro range”.

1&1 Drillisch said the decision would end its rival’s claims against it, though it still has two cases outstanding against the Telefonica unit related to the agreement where it is “seeking substantial retroactive price reductions”.

Telefonica Deutschland argues the other outstanding claims are unjustified.

Forced partners
Hosting a Mobile Bitstream Access MVNO agreement with 1&1 Drillisch was one of the mandated terms for Telefonica’s acquisition of German market rival E-Plus, which completed in 2014.

Last year 1&1 Drillisch bought spectrum in the country’s 5G auction and is in the process of deploying its own network infrastructure, supported by its wholesale agreement. However, its timescale has slipped due to Covid-19 related issues.

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Chris Donkin

Chris joined the Mobile World Live team in November 2016 having previously worked at a number of UK media outlets including Trinity Mirror, The Press Association and UK telecoms publication Mobile News. After spending 10 years in journalism, he moved...

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