The Croatian regulator (HAKOM) has recently submitted a notification to the European Commission expressing its desire to deregulate approximately 72 local markets for fast fixed-line internet.
It proposes removing the significant market player (SMP) criteria, which will in effect remove the price controls it puts on the incumbent Hrvatski Telekom (HT) for wholesale and retail.
HT’s competitors A1 and Telemach believe the move will unfairly undercut them on retail prices in the relevant local markets, including urban areas with the most affluent households.
According to industry sources, HT, which is majority owned by Deutsche Telekom, currently accounts for almost 60% of Croatia’s internet and pay-TV market. This is one of the most dominant positions in the European telecoms sector.
However, Croatia’s broadband coverage is ranked as one of the worst in Europe. What is more, all alternative operators that have so far tried to enter the market have failed.
Commenting on the situation to Broadband TV News, Adrian Jezina, CEO of Telemach Hrvatska said:
“HAKOM’s decision to deregulate now will entrench the position of the dominant market player for another generation, benefiting Deutsche Telekom at the expense of Croatian consumers.
“Our entry into the market as a third player has already stimulated competition and led to greater investment. Now is the time to be encouraging competition to invest further in infrastructure to create a more competitive environment.
“Croatia needs an encouraging and stable regulatory framework, which will boost investments by all operators without favouritism. We hope that the European Commission carefully review’s HAKOM’s proposal to ensures that it is harmonised with the practices of the European Union, and in the best long-term interest of consumers in Croatia”.
